The Outfit (44 page)

According to Bobby’s sister Jean Kennedy Smith, the argument that ensued at Hyannis Port that Christmas was bitter, “the worst one we ever witnessed.” Kennedy adviser Arthur Schlesinger, Jr. described the row as “unprecedentedly furious.” The politically savvy father warned that such an upheaval would turn labor against Jack in his presidential quest. Longtime Kennedy confidant Lem Billings recalled, “The old man saw this as dangerous . . . He thought Bobby was naive.” Bobby, however, saw things differently, believing such a crusade would actually enhance the family’s image. Chicago investigator Jack Clarke, who headed Mayor Daley’s investigative unit and occasionally counseled Bobby Kennedy, also detected Bobby’s personal agenda. “If Bobby really wanted to investigate organized crime, he never had to leave Boston,” Clarke recently said. “The McClellan thing was a show. Bobby thought it was just good politics.” Clarke’s view is supported by Bobby’s friend, anticrime journalist Clark MoUenhoff, the Washington editor of the
Des Moines Register.
MoUenhoff, who had been prodding Bobby Kennedy for months to spearhead such an investigation, met with little success until he called Bobby and introduced his brother Jack’s presidential aspirations into the debate. “Kefauver did his investigations five years ago and it got him enough clout to beat your brother’s butt [at the 1956 Democratic National Convention].” Suddenly, Bobby’s interest was piqued. “Well, why don’t you come down and we’ll talk about it.”

Eventually, Bobby began cajoling McClellan about forming the committee, but Joe Kennedy was not yet convinced his son’s probe could not be short-circuited. Joe enlisted Bobby’s mentor, Supreme Court justice William O. Douglas, to try to talk some sense into the young firebrand. But Douglas’ intervention also proved futile, as Douglas later told his wife about Bobby’s intransigence, “He feels this is too great an opportunity.”

When the committee went out of business, it had established evidence that led to the convictions of ninety-six of its criminal witnesses. And although it steered clear of upperworld liaisons, it occasionally stumbled inadvertently into embarrassing disclosures, such as that several of the targeted unions leased their New York offices from none other than Bobby’s father. One of Kennedy’s key targets, Teamsters VP Jimmy Hoffa, said years later, “You take any industry and look at the problems they ran into while they were building it up - how they did it, who they associated with, how they cut corners. The best example is Kennedy’s old man . . . To hear Kennedy when he was grandstanding in front of the McClellan Committee, you might have thought I was making as much out of the pension fund as the Kennedys made out of selling whiskey.”

The Tropicana

While the McClellan Committee did battle with Teamster officials in Washington, the Outfit remained unfettered in its Las Vegas expansion. The success of the Stardust had inspired Rosselli and the Outfit to gear up for still more acquisitions. In a feat of ambassadorial legerdemain that rivaled the latter-day shuttle-diplomacy efforts of President Jimmy Carter, Rosselli brokered a complex partnership in the $50-million Tropicana, designed to be the most luxurious facility on the Strip. The intricate ownership trust of the Tropicana, which opened for business on April 3,1957, included the Outfit, Frank Costello of New York, Meyer Lansky of Miami, and Carlos Marcello and “Dandy” Phil Kastel of New Orleans. Another curious partner in the deal was Irish tenor Morton Downey, the best friend and business partner of Kennedy family patriarch Joseph P. Kennedy. In 1997, Morton Downey, Jr. said that the Tropicana investment, as well as numerous others made by his father, were conceivably hidden investments of Joe Kennedy’s, with Downey acting as the front. “Joe was my dad’s dearest friend,” Downey, Jr. said. “My father owned ten percent of the Tropicana. I wouldn’t be at all surprised if he was fronting it for Joe. That’s how they worked. My father often had someone ’beard’ for
him
also. I remember when he would jump up screaming at the dinner table when his name surfaced in the newspaper regarding some deal or other. ’They weren’t supposed to find out about that!’ he’d yell.”

To oversee the Outfit’s stake in the enterprise, Curly Humphreys sent a trusted associate named Lou Lederer from Chicago to run the casino, which would become the most profitable in Las Vegas. For appearances, the Tropicana operation was fronted by the same man who fronted for the Commission’s interest in Miami Beach’s Fontainebleau Hotel, Ben Jaffe. Despite this precaution, the hoods’ hidden interest in the Tropicana became known when Frank Costello was shot above his right ear by a rival New York gangster on May 2, 1957. Although the wound proved superficial, its unintended ramifications were anything but. While Costello was in the hospital recuperating, detectives found an incriminating handwritten note in his pocket. Written in the hand of Humphreys’ guy Lou Lederer, the explosive scrap of paper notated the skim from the Tropicana:

As a result of the serendipitous discovery, Costello was forced to divest his interest in the Tropicana. More important, the local Mormon-controlled banks began denying loans to questionable entrepreneurs, and the Mormon-controlled Gaming Control Board became even more stingy, and discriminatory, with its licensing approvals. Until this time, the gangster owners had financed much of their start-up costs with moneys supplied by the Mormon-owned Bank of Las Vegas. Although they certainly had more than enough disposable income to afford the costs, the hoods’ decision to go with a more traditional method served a more important function by not calling the attention of the IRS to their immense hidden nest egg. Luckily for the Outfit, a new, well-endowed bank had just opened in Chicago, and it curiously seemed to prefer gangster clients.

The First National Bank of Accardo

If the Outfit had to face a bump in the road in Vegas, it could not have come at a more fortuitous time than 1957. That year saw the realization of an Outfit Five-Year Plan that gave them “preferred borrower” status for low-interest loans from a new bank, otherwise known as the Central States Pension Fund of the Teamsters Union.

The key players in this unprecedented dispensation were an old Capone associate named Paul “Red” Dorfman, a Teamster up-and-comer from Detroit named James Riddle Hoffa, and the plan’s architect, Curly Humphreys.

The FBI called Red Dorfman, titular head of a number of labor unions including the Humphreys-controlled Waste Handlers Union, one of the five or six men closest to Joe Accardo, while a Chicago Teamster described him as “a hood’s hood.”
²
Another Teamster said about Dorf- man, “He was a small, thin, red-haired guy who’d walk in and throw two bullets on a guy’s desk and tell him, ’The next one goes in your fuckin’ head.’ “ In the late forties, Hoffa’s ambition to ascend the Teamster power structure was in overdrive. He knew that to achieve his goals he would have to gain the allegiance of the all-powerful Outfit, which by now had a vise grip not only on Chicago’s influential local Teamsters, but on the locals of numerous cities west of Chicago, which were also taking orders from Humphreys.

Through a union-busting Michigan steel hauler named Santo Perrone, Hoffa met Humphreys’ guy Red Dorfman, who then introduced Hoffa to Accardo, Humphreys, Ricca, and the rest. Hoffa also became close friends with Joseph Glimco (ne Guiseppe Glielmi), appointed by Curly in 1944 to run the fifteen powerful Teamster taxicab locals of Chicago. According to the FBI, Red Dorfman suggested to Humphreys that if the Outfit’s Teamster locals, which Curly controlled, backed Hoffa’s advancement, Hoffa would return the favor by opening up the Teamsters’ pension fund vaults to the Outfit and their friends. At the 1952 Teamster convention, where Hoffa was seen schmoozing Joey Glimco and other hoods, the underworld decided to bequeath Hoffa the union’s vice presidency, a prelude to his coronation five years later. However, all knew that Hoffa would be the real power behind the “front” president, Dave Beck. According to Rosselli’s friend L.A. mobster Jimmy Fratianno, Beck agreed to retire after one five-year term, while Hoffa worked behind the scenes to broaden his own power base, simultaneously proving to his underworld sponsors that he was capable of ruling.

The fine points of the deal dictated that Hoffa would appoint Red’s son, Allen, a college phys-ed teacher, to administer the pension fund loans. Technically, a Teamster fund board of trustees, with Allen as a “consultant,” had to authorize the loans, but in actual practice, Allen with his intimidating underworld sponsors, called the shots on loan approvals. From that point on, the hard-earned dues of truckers, warehousemen, and taxi drivers from the twenty-two states that comprised the Central Fund would subsidize the Outfit’s business ventures in Nevada and elsewhere. And for the next twenty-five years, Outfit-backed Allen Dorfman disbursed the assets of a fund that would be valued at $400 million by the midsixties. By 1961, the fund had lent over $91 million in low-interest (6 percent) loans. In all, some 63 percent of the fund’s holdings were made available to borrowers.

For the first few years (until Hoffa assumed the Teamster presidency in 1957), the Outfit kept its “withdrawals” low profile, mostly in the form of business funneled to Allen Dorfman’s newly constituted Chicago branch of the Union Casualty insurance company. During those years, father and son Dorfman were estimated to have received over $3 million in commissions. An emergency loan-of-sorts involved the “purchase” of Paul Ricca’s Indiana farm by his new friend Jimmy Hoffa’s Detroit Teamster locals, this despite labor-union ownership of property being illegal in Long Beach. Hoffa later said that the property was to be converted into a school for Teamster business agents. At the time, Ricca was facing an IRS deadline for payment of tax penalties, so the Teamsters paid Ricca $150,000 for the spread, which was valued at only $85,000. In addition, the Riccas were permitted to live in the house free of charge for over a year.

In 1957, the year of the bank crackdown in Vegas, the Teamsters were preparing to name a new international president to replace incumbent Dave Beck, who was facing federal tax and larceny charges, the result of McClellan Committee revelations. The Outfit’s Five-Year Plan, arranged in 1952, would now achieve fruition, with Hoffa’s being maneuvered into the Teamster presidency at the upcoming September convention to be held in Miami.

On August 28, 1957, one month before the Teamster convention, the OCID unit of the Los Angeles Police Department watched surreptitiously as the Teamsters Executive Board met with Jimmy Hoffa and three powerful residents of the Windy City at L.A.’s Townhouse Hilton Hotel. An LAPD memo in the files of the Chicago Crime Commission gives further details of what the OCID witnessed:

According to information given to the LAPD, three men are with Hoffa for the purpose of aiding his cause in becoming President of the Teamsters Union. It is claimed that the men in question are: Murray Humphreys, Marshall Caifano, [and Humphreys aide] Ralph Pierce all of whom are well-known Chicago hoodlums. It is stated that a member of the Executive Board is being taken before these men singly, and they are advising members of the Executive Board in no uncertain terms that Hoffa is to be the next President of the Teamsters Union.

When the word came down to Dorfman, he dispatched his close friend Johnny Dio (Dioguardi) to New York to organize Teamster “paper locals,” which had the sole purpose of assuring Hoffa’s control of the New York Joint Council of the Teamsters. According to one report, Curly Humphreys, who was known to frequent the Sea Isle Hotel in Florida, was on hand one month later at Miami Beach’s luxurious Eden Roc Hotel to watch from the shadows as Hoffa accepted the Teamster presidency before seventeen hundred roaring delegates.

In the aftermath of Hoffa’s election, Humphreys’ personal friendships with Teamster officials only grew stronger. Jeanne Stacy Humphreys remembers that Curly was very close to John T. “Sandy” O’Brien, the international vice president of the Teamsters, whose wife, Marge, just happened to be the secretary of the Teamsters pension fund. According to the FBI, Humphreys and Congressman Libonati used their Teamster connection with the O’Briens to secure yearly Teamster donations for an underprivileged boys’ camp in Colona, Wisconsin. Curly Humphreys also maintained a close personal relationship with Hoffa, who often vacationed at the Humphreys’ Key Biscayne home. FBI bugs heard Curly tell Joey Glimco, “Hoffa was the best man I ever knew.” According to Humphreys, whenever the Outfit told Hoffa to do something, “He just goes boom, boom, boom, he gets it done.” Humphreys added, “One thing I always admired about the guy, they tried to fuck him, but he never took a bad attitude about it.” On occasion, Humphreys even lent his legal expertise to Hoffa. “I worked on this case for him,” Humphreys said, “and paid out a lot of money for him and never got it back.” Despite the warming relationship with the new Teamster boss, the hoods would wait a suitable while before making withdrawals from their new bank. But once they commenced, they would be ravenous. In the meantime, key Chicago bosses had to tend to business at home.

On the Homefront II

Under Humphreys’ tutelage, the Outfit was enjoying great business successes, but the period was especially trying for Humphreys’ personal life. Weary of Curly’s skirt chasing, and fully cognizant of the affair with Jeanne Stacy, Clemi Humphreys filed for divorce, after thirty-five years of marriage, in Norman, Oklahoma, on July 6, 1957. Her petition alleged that Curly had ’been guilty of gross neglect and incompatibility has existed . . . for more than three years by reason of which the parties have not lived together.’ Within a year, Humphreys married Jeanne Stacy, lavishing on her a beautiful waterfront home in Key Biscayne, Florida. The FBI was never able to confirm the marriage to Stacy, although they combed official records in St. Louis, Chicago, Miami, and even Mexico City. “That’s because we got married in Georgia,” Jeanne Humphreys recently said. “The justice of the peace almost fainted when Murray handed him two hundred dollars for a two-minute ceremony.”