The Outfit Page 7

  Practically before Capone’s handcuffs could be affixed, the word began to spread that he had been set up, as some pointed to his inept defense The bottom line held that, since Al’s removal would be better for all concerned, an unholy alliance had been formed between his criminal heirs and the taxman. Teeth were put into the rumors in 1936 when Mrs. Gus Winkler told the FBI that her husband had worked to clear Capone of the tax charges before his conviction. Gus Winkler had confidently advised Paul Ricca that Capone’s case could be fixed for a mere $100,000 back tax payment. However, before Winkler’s gambit could gain momentum, Frank Nitti and Louis Campagna showed up at the couple’s apartment. According to Winkler, the duo ordered her husband to back off. “They wanted Capone in jail,” she remembered. At the time of Al’s trial, Paul Ricca allegedly said to an associate, “Al was bad for business and it was better that he left the scene.” Insiders whispered that Capone’s own men had tipped the feds to the crucial financial records that sealed his fate. Although these theories have not been proved, they are widely accepted by many Chicagoans in a position to know.

  While temporarily incarcerated at the Cook County Jail, Capone stayed true to form. His boys managed to bribe his jailers, allowing their boss a life of privilege known to few on the outside: The constant stream of guests imbibed whiskey that Capone was supplied by the gallons; his mistress paid conjugal visits, as did a pimp named Bon-Bon, who happily supplied his girls to the boss. Eventually there was a crackdown when the prison warden was caught driving Capone’s sixteen-cylinder Cadillac. After a slew of delaying - but futile - legal tactics, Capone was eventually sent away to Atlanta in May 1932. While in prison, he was diagnosed with third-stage syphilis. When his illness became severe, he was granted an early release in 1939, with the disease finally claiming him in 1947.

  Immediately after Capone went away, payments commenced to Al’s wife, Mae. Gang couriers arrived at his home with moneys tithed by the gang to guarantee Mae’s and her young child Sonny’s welfare. Mrs. Capone is said to have received $25,000 per year until the day she died many years later. The “pension fund” was among many of the new traditions to be instituted by Capone’s heirs. From its inception until the gang’s downfall many years later, a monthly stipend was delivered to the families of all the gang’s leaders who were incarcerated or dead. It was one of many corporate-like regulations adopted by Capone’s heirs - the Outfit.

  1. Chicago’s first boom peaked in the 1830s, with more than 150 buildings going up that summer alone. With fourteen miles of riverfront docking space, Chicago was the new nation’s largest inland port, and bullish traders were anxious to exploit nature’s gift. But a nationwide bank panic in 1837 and a subsequent depression sent the city’s newfound prosperity into a tailspin. In 1847, William Ogden came to the rescue when he built a huge factory to manufacture the revolutionary McCormick grain reaper. Coincident were the completion of the Lake Michigan-Illinois River Canal and the Chicago Union Railroad. While the canal gave the nation’s breadbasket farmers access to Eastern markets, the railroad completed the connection to the West. On the Chicago Union’s heels there followed five more rail lines laying tracks through the city. By 1855 ten more railroads completed the transition of the infant city into a commercial crossroads. The railroads combined with its natural route (the Illinois River) to the southern port of New Orleans, put the Second City in hyperdrive. As Lloyd Lewis wrote, “Chicago had become Chicago.”

  2. Describing the underworld, Herbert Asbury wrote of “rooms for assignation, procuresses, dens where young girls were raped by half a dozen men and sold to the bordellos, cubicles which were rented to streetwalkers and male degenerates, and hidden rooms used as hideaways by every species of crook.”

  3. When Thompson died in 1944, over $2 million in gold, cash, and stock certificates was found in his safe-deposit boxes.

  4. No better symbol is needed to illustrate the collusion between City Hall and the gangsters than Big Jim’s funeral, and absolutely no effort was made to conceal it. At the lavish affair, Kenna and Coughlin knelt by the coffin. One thousand members of the First Ward Democratic Club and five thousand constituents also accompanied Big Jim to his final resting place in Oakwood Cemetery. Honorary pallbearers included an assistant state’s attorney, three judges, nine aldermen, and a state representative, all marching side by side to the cemetery with Johnny Torrio and his goon squad. Torrio, after paying all the funeral expenses, expressed grief and wept, “Big Jim and I were like brothers.” Many of his gang let their beards grow until after the funeral, as per Italian custom.

  5. The “fake” hooch was in fact deadly. When Groucho Marx joked in A Night at the Opera that he went to a party that was so wild he was “blind for a week,” the remark was rooted in fact; alcohol like the Gennas’ was also known to cause blindness. Ironically, this was just the sort of brew that should have been prohibited but was in fact created by the Volstead Act.

  6. After opening the Cotton Club in Cicero, Capone initiated the exodus of black musicians from the Big Easy (and elsewhere) to the Second City. Players such as Louis Armstrong, Jelly Roll Morton, King Oliver, Duke Ellington, Milt Hinton, Lionel Hampton, Fats Waller, and Nat King Cole were now making the kind of money they deserved. Capone developed genuine friendships with these players, treating them like family. Great jazz bassist Milt Hinton has spoken of how the Big Guy paid his hospital bill when a nearly severed finger threatened to nip his brilliant career in the bud. One night, pianist Fats Waller was “kidnapped” from the Sherman Hotel by armed gangsters, only to be delivered to Al Capone as a birthday gift. Capone treated Waller like a king, and when the three-day party finally waned, the extraordinary pianist found that Capone had lined his pockets with thousands of dollars.

  7. The quixotic O’Banion once reminisced about one of his adventures, explaining how a safecracking attempt was interrupted by a policeman: “I was just about to shoot that yokel cop when I remembered that [my partner] the Ox had a pint bottle of nitroglycerin in his pocket. One shot in that room would have blown the whole south end of the Loop to Kingdom Come.” Competitors like Capone wondered who could talk sense with such a man.

  8. Johnny “the Fox” Torrio suffered a fatal heart attack while in his barber’s chair in Brooklyn. He and his wife, Anna, had led such a hermetic existence for the previous two decades that only a smattering of neighbors showed up at his wake, a far cry from the mammoth send-offs given fellow Chicago kingpins Jim Colosimo and Deanie O’Banion. So inconsequential was his passing that newspapers did not learn of it for three weeks. Just five weeks earlier (February 26,1957), Torrio’s former nemesis Bugs Moran died in Leavenworth prison, where he had recently been imprisoned for bank robbery. The heist came just days after his 1956 prison release, after a ten-year stay, on a similar charge.

  9. Capone’s image transformation was inspired in part by the counsel of Chicago Evening American editor Harry Read, who was happy to trade advice for inside stories from the Big Guy. Speaking to Capone on one occasion, Read advised, “Al, you’re a prominent figure now. Why act like a hoodlum? Quit hiding. Be nice to people.” (Read would eventually be fired from the American when the Tribune published a photo of him catching rays with the Big Guy at Capone’s Palm Island, Florida, estate.) Apparently, Read’s words struck a chord with Capone, who soon began venturing out in public, the most accessible gangster the world had ever seen. He began holding regular press conferences to win back the public. He even announced to a throng of disbelieving journalists for whom he had dished up a spaghetti dinner at his home, “I am out of the booze business.” Incredibly, Al Capone became the toast of Chicago - at least among the city’s downtrodden blue-collar segments. He was cheered at prizefights, racetracks, and at Cubs games with five minute standing ovations; he gave writers and perfect strangers tips on fixed fights and horse races.

  10. Ten months after the massacre, evidence gathered at another murder gave a strong indication as to the identity of one of the shooters. At the time, th
e science of ballistics was in its infancy, but it had already been learned that gun barrels leave unique scratches, or rifling marks, on exiting bullets. Rifling marks on the bullets recovered from the scene of the December 1929 murder of a St. Joseph, Michigan, policeman matched identically the marks on bullets from not only the St. Valentine’s Day massacre, but also the assassination of Frankie Yale. More important, the bullets from the policeman’s slaying were matched to a weapon that was traced to gang hit man Fred “Killer” Burke. Burke was captured and sentenced to a life sentence in the police murder, never standing trial for the St. Valentine’s Day shooting.

  11. With county clerks on his retainer, Capone was kept informed of any meaningful event that took place in the lives of Italians and Sicilians. Thus cards, gift baskets, and flowers were sent to families mourning a recent death, or celebrating a birth, marriage, or high school graduation; every hospitalized Italian or Sicilian who came to Al’s attention received a personal note attached to a floral arrangement; Capone spent Sunday mornings in the Italian districts personally handing out money to the needy. He attended christenings and wakes of perfect strangers; baskets of food were sent weekly to the infirm and the needy, and this being the Depression, the roster was bulging; Capone’s soup kitchens became the stuff of legend. After using his muscle to convince local food producers to “do your bit, or else,” he hired good cooks for his spotless facilities and fed some ten thousand per day. When winter came, the destitute were served chili, beef stew, rye bread, and coffee or hot chocolate. Lastly, Capone gave slum children Grade A milk for the first time in their lives, ordering his sluggers to force the Chicago City Council to adopt a date stamp on milk cartons. After his death, upperworld capitalists had the law repealed.

  Part One

  The Outfit

  1.

  Young Turks in Charge

  While imprisoned in Philadelphia in 1930, Big Al Capone underwent the kind of self-reflection that is an inescapable by-product of incarceration. For Capone, it resulted in a grand scheme he bequeathed to his successors. Later, in Chicago, in anticipation of his 1931 tax conviction, Capone held one last Syndicate meeting before what he assumed would be a brief incarceration. Summoning his most loyal and indispensable soldiers to his side, Snorky presented his vision: a national crime corporation that would be run not by an all-powerful boss, but by a board of directors, a corporation of thieves partnering with the Torrio-Lansky Commission, whose goal was to make a swift transition into more legitimate white-collar scheming. Until now, this world had been dominated by the upperworld robber barons and Wall Street swindlers, whom the nation held to an infinitely lower standard of justice than the rest of the population. By encouraging his heirs to follow that path, Al Capone was orchestrating his legacy.

  The new regime heeded the mistakes of the old, adopting a modus operandi that would serve them effectively well into the future. Capone’s heirs apparent grasped the obvious: Al’s downfall was largely due to his refusal to hide his money or to provide an explanation of what he did for a living. Capone’s personal style only increased his vulnerability. Combined with his penchant for violent retaliation and a high profile - fancy clothes, flashy cars, and movie-star hangers-on – Capone was his own worst enemy. His heirs would contrast Capone’s style with one of their own: anonymity. No effort would be spared to avoid press coverage of the new bosses.

  Al Capone took every opportunity to point out the judicial double standard in rationalizing his crime wave. Although unschooled, Capone learned on the streets what respected academics such as Ferdinand Lundberg acquired in research libraries. In his seminal 1968 book, The Rich and the Super-Rich, Lundberg described how the fortunes (and social standings) of Carnegie, Whitney, Rockefeller, McCormick, and others were built on a foundation of white-collar thuggery, or as Capone called it, “legitimate rackets.” Robber baron Cornelius Vanderbilt hardly recoiled at the accusation, asking, “You don’t suppose you can run a railroad in accordance with the statutes, do you?”

  Among the crimes Lundberg attributed to the country club set were “embezzlement; big fraud; restraint of trade; misrepresentation in advertising and in the sale of securities; infringement of patents, trademarks, and copyrights; industrial espionage; illegal labor practices; violations of war regulations; violation of trust; secret rebates and kickbacks; commercial and political bribery; wash sales; misleading balance sheets; false claims; dilution of products; prohibited forms of monopoly; income tax falsification; adulteration of food and drugs; padding of expense accounts; use of substandard materials; rigging markets; price-fixing; mislabeling; false weights and measurements; internal corporate manipulation, etc.”

  The victims of white-collar crimes numbered in the millions, many of whose lives were destroyed in stock market swindles and labor abuses. At the time of his 1931 pretrial proceedings, Capone gave an interview to Liberty magazine, in which he recalled:

  Why, down in Florida, the year I lived there, a shady newspaper publisher’s friend was running a bank. He had unloaded a lot of worthless securities upon unsuspecting people . . . One day his bank went flooey. The crooked publisher and the banker were urging bankrupt depositors who were being paid thirty cents on the dollar to put their money in another friend’s bank. Many did so; and just about sixty days later, that bank collapsed like a house of cards too. Do you think those bankers went to jail? No, sir. They’re among Florida’s most representative citizens. They’re just as bad as the crooked politicians. I ought to know about them. I’ve been feeding and clothing them long enough. I never knew until I got into this racket how many crooks there were dressed in expensive suits and talking with affected accents.

  Another robber baron who may have fueled Capone’s rationale was Boston-based banker/political patriarch Joseph P. Kennedy. According to numerous reports, Al Capone had known Kennedy since they cut a bootlegging arrangement in 1926. By the time Capone was imprisoned, Kennedy was widely known to have been one of the most offensive robber barons of the era.1

  Fueled by such rationalizations, Capone’s heirs set about engineering their version of the American Dream. Such an enterprise required distinct divisions of labor and brainpower, and in his preprison powwow, Capone installed an executive team with the requisite talents. Virgil Peterson, who headed the Chicago Crime Commission for three decades, later remembered that a friend of his was offered a $25,000-a-year job to direct a “new corporation.” Further investigation revealed that the “corporation” was in fact the Capone Syndicate. Peterson’s friend passed up the offer, but the Syndicate continued their head-hunting, and Capone’s eventual appointment of a CEO-type successor incorporated a deceit characterized by a stealthy brilliance.

  In naming forty-two-year-old Frank Nitti (ne Nitto) to the top post, Capone employed a strategy that has been largely ignored in discussions of Chicago crime: the boss is quite often a lightning rod, intentionally positioned to deflect attention from the real power, i.e., the lower-profile board of directors. Nitti’s appointment was also predictable given his Sicilian birth and seniority over the other members of the Outfit, as they now called themselves, most of whom were barely thirty when Capone was collared.

  Nitti was never the tommy-gun-wielding “enforcer” that has been depicted. He earned his sobriquet The Enforcer because his role mandated enforcement of the internal rules adopted by the board of directors. This responsibility did not entail gunfire, only arbitration. Born Francesco Raffele Nitto in Augori, Sicily, in 1889, Nitti was in fact a smallish, introspective gangster, but like Capone’s other successors, he appreciated the effect of the occasional show of power. Within two months of Nitti’s installation as “CEO,” bombs went off in forty warehouses and offices in and around Chicago. No one was hurt, and little actual stock was destroyed. The attacks were a forceful announcement to Chicago’s citizens that the Outfit was now in charge.

  Virtually every mass media portrayal of Frank Nitti has bordered on the fallacious. Most recently, in the 1987 film The Unt
ouchables, Nitti was depicted as the villainous archenemy of the equally misrepresented “heroic” prohibition agent Eliott Ness. In the film’s dramatic climax, the intrepid Ness pushes Nitti off a rooftop to his death. In fact, nothing like that ever occurred. Nitti’s death had absolutely nothing to do with Ness, who ironically was a womanizing, antibooze enforcer who ultimately drank himself to death.2

  Nitti’s parents brought him to America when he was three years old, settling in Brooklyn, the New York borough that had given rise to so many Chicago bosses. It is not known if he associated with Capone, Torrio, et al., during this period, although it is highly likely, given where he would soon end up. After learning the barber trade, Nitti entered the New York to Chicago gangster pipeline around 1920. In the Windy City, Nitti quickly made his name as one of Chicago’s premier “fence” operators. With his extensive network of shady buyers for stolen goods, Nitti was perfectly positioned in 1920 to make the transition to bootlegging with Torrio’s Syndicate. Nitti made his bones with Torrio-Capone as a successful smuggler of top-shelf whiskey from Canada to Chicago and, in 1930, was convicted of lesser tax charges than his boss, Capone, who was jailed one year later. With his loyal wife, Anna, spearheading his early-parole petition, the prison received character references from, among others, a mortuary owner who was a longtime friend of the gangster’s - one can only wonder how much business the Syndicate had sent his way. Nitti himself promised the parole board that, if paroled, he would immediately move to Kansas City and accept a position in the dairy business. He would of course do neither. Granted parole soon after the Big Guy “went away,” Nitti instead returned to Chicago and accepted the leadership post bequeathed to him by Capone.