“What happened at that time?”
“Ralph came down one day.”
“Ralph who?”
“Ralph Brown or Ralph Capone,” said Ries, referring to the alias frequently adopted by the family. “And he came down there with Pete Penovich one day and said Pete Penovich was taking charge. He said Mondi was out.”
“I show you here forty-three cashier’s checks. Tell us about them,” said Grossman, bringing out a series of exhibits.
“They represented profits above the bankroll of $10,000 we always kept and above all expenses which I paid out. I bought the checks and gave them to Bobby Barton.” The checks came to a total of $177,500 for 1927 and $24,800 for the following year—all of it profits from gambling.
Capone’s lawyers tried to have this evidence ruled out of bounds. At the same time, they conceded that their client was unquestionably a professional gambler. In response, Jacob Grossman traced the path of the profits from Capone’s gambling establishments through layers of accountants and bookkeepers: a paper trail so complex that it almost but not quite obscured Capone’s involvement.
Wilkerson predictably sided with the prosecution. “This defendant enjoyed an income in excess of the amount which made it obligatory for him to return and pay a tax to the United States. . . . The government has offered in evidence tending to show what might be characterized as negative evidence: evidence tending to show there were no memorandums, no books of account, no records, no bank account; evidence tending to show the defendant on many occasions was in the possession of large sums of money; . . . evidence tending to establish that this defendant had undertaken to build around him a stone wall so that those who sought to learn his condition as to financial affairs would find him inaccessible. In view of that situation the government is relying upon a chain of circumstances. I think it is proper evidence,” he finally declared. “Overruled.”
But Michael Ahern wanted to make one last point concerning this damning chain. How one interpreted it, he said, depended on whether one looked at the transactions individually or collectively. Separately, they signified nothing, and even taken together, they made for a very weak presumption. “On top of that,” Ahern continued, “they build another presumption, that Capone knew Ries just because he said, ‘Hello, Ries,’ and Ries said, ‘Hello, Al.’ ” Ahern shook his head in dismay. “Why, I venture to say that all of these newspaper boys here in the courtroom would be able to say to me, ‘Hello, Mike,’ and yet I could not call them by name.” Ahern resumed hammering away at the chain, trying to find the weak link to smash. Perhaps it was the Guzik connection. “Let us take the statement in 1928 when he cashed a check and somebody asked him who Jack Guzik was. Well, just as much as to say, ‘That is none of your business,’ he might say, ‘That is my financial secretary,’ or ‘my social secretary.’ But did he say that?”
“The testimony is that he did say Guzik was his financial secretary,” said Judge Wilkerson.
Ahern pounced. “When did he say it? If he said it at all he said it in 1928. Then that was subsequent to those transactions that are here sought now to be introduced, and an admission in 1928, if you consider it so, that ‘he is my financial secretary,’ does not make that run backwards.”
“You cannot take a chain of circumstances and rule them all out merely because each one stands alone,” Wilkerson concluded. “Objection overruled.”
The checks were entered into the records, along with the Mattingly letters and the testimony of fifty government witnesses about the tens of thousands of dollars Capone had paid for goods and services over the years.
With a final flourish, the prosecutors flipped over one of the checks, in the amount of $2,500, and pointed out the endorsement, containing the signature of the defendant himself, not an assistant or an employee: proof that Capone himself had received the money. The check was stamped as being paid on June 3, 1927. In this case, at least, the jury would not have to presume anything about the defendant’s reaping the profits of the gambling establishments.
George E. Q. Johnson, the U.S. attorney, rose and addressed the court for the first time. It was 2:20 in the afternoon, and his carefully chosen words startled everyone:
“If it please the court, at this time the government rests its case.”
• • •
The unexpected announcement created an uproar. The courtroom emptied as reporters dashed to the telephones to get the news to their respective city desks: Prosecution rests its case. Ahern looked up in astonishment. “What?” he was heard to say to his partner. Both he and Fink had been taken completely by surprise. In terms of outmaneuvering the other side, Johnson’s prosecutors had just accomplished a considerable coup.
Relishing the obvious confusion in the Capone camp, Judge Wilkerson turned to Fink and asked, “Are you ready to proceed?”
The lawyers huddled at the bench, as Capone leaned forward in his seat, straining to hear what was said.
“Well, if Your Honor please,” Fink stammered, “this is kind of a surprise. We would like a little time to get ready for our defense. Your Honor said, I think, that if during the course of the trial we were not prepared to meet what the government offered, you would be a little indulgent with us for a while.”
Wilkerson excused the jury, and the defense lawyers continued to complain. Convinced of government treachery, aware that they were unprepared to mount a defense of their client, they pleaded with the judge for more time. Flushed with passion, Fink argued that the government’s team of four lawyers had been assembling its case against Capone for the better part of four years, while he and Mr. Ahern, toiling all alone, had but a few weeks to prepare. It simply wasn’t fair to hurry the defense.
“We have a jury confined here,” Judge Wilkerson reminded the defense lawyers, and he gave them until the following morning to present their case.
“If Your Honor thinks it fair to put this man to defense at 10 A.M. tomorrow, I’ll be here. I’ll do the best I can,” said Fink, sounding deeply offended. “If we offer no evidence, what time may we have for arguments?” Fink pleaded for ten hours to present his closing argument.
“Ten hours?” said the judge, his wiry eyebrows shooting up.
The two haggled, and in the end, Ahern and Fink were granted four hours in which to attempt to exculpate their client. With that, court was adjourned.
• • •
The curiosity seekers, whose number had been dwindling, returned to the courthouse with a vengeance on Wednesday, October 14, to behold a pair of celebrities: Al Capone, the nation’s best known gangster, and Edward G. Robinson, Hollywood’s best known gangster actor. “Little Caesar” (the role he played in the hit movie earlier in the year) came to study his original in the flesh; art was imitating life.
The hastily assembled defense of Al Capone they all heard that day was an embarrassment—a laughable parade of gamblers whose testimony might have been scripted by Damon Runyon. The “shiny-shoed” gamblers he called them, men with suspicious tans and carefree manners acquired in Florida, who looked wholly out of place in Chicago, to which they had been summoned to testify in Capone’s defense. They formed part of Ahern and Fink’s ill-conceived strategy: they would attempt to prove that whatever he earned by gambling, he lost by gambling, usually at the track. Even if true, and there was a grain of truth to it, this was as much an indictment of their client as a defense, but they doggedly pursued it anyway, and if the strategy failed to save Al Capone from conviction, it did offer an analysis of his reckless gambling behavior—as well as a few good laughs at the expense of the “shiny-shoed” gamblers. “The gambler witnesses prove a naïve lot, their mental outlook formed in a world of which the rural jurors could have little conception,” the Tribune warned. “They have a code of strict honor applied to their own business. They have little sense of being outlaws, or of doing wrong in the accepted sense. To circumvent ‘the law’ is part of their life, a sort of game.” But now the law had caught up with them.
Calling his first “shi
ny-shoed” witness for the defense, Albert Fink examined a bookie by the name of Milton Held.
“Have you had any transactions with the defendant, Alphonse Capone?” Fink began.
“Yes, while I was taking oral bets at Hawthorne in 1924 and 1925. I would take a bet and settle the next day.”
“Did he win or did you?”
“He lost, I judge, about $12,000.”
Dwight Green of the prosecution then subjected the bookie to a brief cross-examination by asking a spiraling series of questions.
“What was your first transaction with the defendant?”
“At Hawthorne in 1924,” Held said.
“Name the first horse he bet on.”
“I can’t do that.”
“Name any horse he ever bet on.”
“I am not able to that.”
“How did you arrive at the amount of $12,000 which you say he lost?”
“That was just an estimate.”
“Are you positive he lost?”
“Absolutely.”
“How much did Capone bet at a time?”
“Three or four hundred dollars.”
“How many customers did you have who bet that much?”
“Two or three.”
“Did he have much of a roll when he paid you?”
“Yes, he usually had quite a lot of money, mostly in $100 bills. Sometimes in $500 bills.”
As Green’s questions implied, Held’s testimony, vague as it was, offered further circumstantial evidence of his vast, untaxed income; in its own way it was as revealing as the stories of the Marshall Field salesman.
Green proceeded to cast suspicions on Held’s legitimacy as a witness. “Where did you discuss your testimony first?” he asked.
“At the Lexington Hotel, Monday night. Somebody called me up and I went there. Mr. Fink, Mr. Capone, Mr. Ahern and a lot of bookmakers were there.”
“Who rang you up?”
“I don’t know. One of Al’s boys.”
“Did you discuss the case again?”
“Well, I went back last night at eight o’clock and Al asked me if I’d be here this morning at ten o’clock.
“Did you treat that as a demand?”
“I don’t think so.”
“Who are some of Al’s boys?” Green inquired.
“I don’t know.”
In any event, Green had effectively managed to suggest that Held was testifying under duress. (But so, of course, were several government witnesses, notably Fred Ries, the cashier.)
After another bookie, Oscar Gutter, took the stand and testified that Capone lost about $60,000 through him, Green again subjected him to a searching cross examination.
“How did you remember that he lost $60,000?”
“My ledger showed that at the end of the season.”
“I thought you didn’t keep any books.”
“Well, I kept them from month to month so I could pay my income tax,” Gutter stated, as if he were telling the truth, which was highly unlikely. He was simply trying to avoid being prosecuted for failing to pay taxes himself.
“Why didn’t you keep them permanently?”
“Well, it was an illegitimate business.”
“Did you pay the defendant in checks or currency when he won?”
“I always paid him in currency, because he requested that. I called at the Metropole Hotel and paid him if he won or collected if he lost.”
More damage to Capone’s case. Gutter stepped down from the stand.
As its next witness, the prosecution called Pete Penovich, the Capone employee and stalwart. Burly, somber, dark-visaged, he was plainly not a man to trifle with.
“You are the Pete Penovich who has been referred to in the testimony in connection with the Smoke Shop gambling house?”
“Yes, sir.”
Fink showed him a chart listing the owners of the Hawthorne Smoke Shop, followed by the percentage of the business they held. But Penovich’s testimony did nothing to advance the defense case. However, under cross examination by the prosecution’s Clawson, Penovich divulged more details of the organization of the Hawthorne Smoke Shop than the jury had previously heard.
“Did you have anything to do with horse bets?” Clawson asked Penovich.
“It was all a part of the business, excepting the wire bets, and that was handled by Frankie Pope.”
“Well, was Frankie Pope under you, then?”
“No, Frankie Pope was the man I was supposed to take orders from. He and Ralph Capone.”
“Who handled the money during the period from May until November 1924?”
“I handled the money in the operation of the business. I received the checks, and I banked the money, and after I had accumulated a profit of $10,000 or $15,000, it would be turned over to Frankie Pope.”
“Did you have an interest in the place?”
“Well, my interest varied. Originally I was supposed to have an interest of 25 percent.”
“You were one of the partners? Was Frankie Pope one of the original partners?”
“Yes, sir.”
“And how much was he to get?”
“I believe his interest was to be twenty-five, too.”
“When did he become your boss?”
“Shortly after we opened in May 1924. Ralph Capone told me there would be a different disposition of money and to go along, and that he would take care of me.”
“You started as a full partner, did you not?”
“Yes.”
“Did it suit you to be cut down, to be made an underling?”
“No. I told Ralph I wanted to know why I was cut down, and he said, ’Well, we had to make different arrangements,’ and for me to go along with him, and that he would see that I would be taken care of.”
“What did you say about being under Frankie Pope?”
“Well, I condescended to it,” replied Penovich, to laughter.
Clawson continued to press him for information on Capone’s gambling establishment.
“How did you happen to go into this Hawthorne Smoke Shop at all?”
“I had a bad location; my location was at a railroad crossing. There were railroad tracks and no business activities.”
“Just a moment,” Clawson interrupted. “It was so bad you that you had to use ten men to help you run it?” he asked in disbelief.
“Well,” Penovich explained, “in the operation of a gambling house ten men are very few help.”
“So what did you do about it?”
“I spoke to Ralph about changing my location and getting up near the Western Electric plant.” The idea was to be convenient to the plant’s well-compensated employees, who could stop by and gamble away their earnings before they reached home and turned the money over to their wives, mothers, and children.
“Why did you speak to Ralph?”
“Because I understood Ralph was the boss, and he could do the fixing for me in Cicero.”
“Fixing with whom?” inquired Clawson.
“With the powers that might be in a position to let me go along without being molested.”
“What powers?”
“Political powers, the police departments, anybody that might be in a position to stop me. I thought maybe, if I would be left alone, I would make some money near the Western Electric plant.”
“What else were you afraid of?” asked Clawson, trying to suggest that Penovich had no choice in the matter of selecting a site for his gambling house because the Capone brothers controlled Cicero.
“Well, I wasn’t afraid of anybody in particular.”
“And the only reason you spoke to Ralph was so that you could get the political powers to allow you to run?”
“That was one of the main reasons.”
“Is it not a fact, Penovich, that the main reason you had to talk to Ralph was that the gang or the organization that was out in Cicero would not let you run unless you talked to him?”
“The main reason was that I fel
t that I could make more money at Twenty-second and Forty-eighth Avenue than I could at Fifty-second Avenue and Twenty-fifth Street.”
“Why did you not first open up there, then?”
“I didn’t know how to make the connections.”
“What connections?”
“Connections whereby I could run without being molested by the authorities.”
“What authorities?”
“Police officers, the state’s attorney, the mayor, sheriff—authorities that are in a position to arrest you if you have a place of business where you operate gambling.”
“What did you think Ralph could do with those connections?”
“I thought he could fix me so that I would be able to run without being molested.”
“What made you think that Ralph could do you any good?”
“From what I heard he could do lots of good in that respect. I heard it from Ralph himself. He seemed to be prosperous, and he was catered to. Every place he went he was welcomed; he was pointed out, in theaters, cafés, places of amusement.”
“Pointed out by whom?”
“People that I had been with, people that I had seen in the lobby, who talked to him.”
“Did he tell you he had such connections?”
“Yes, he told me I would be left alone. He said, ‘Stay here until after the election and I’ll take care of you, so you can make money.’ ”
“Now, Penovich, isn’t it a fact that there was an organization or syndicate in control of Cicero at that time, and of its gambling activities?”
“No, sir.”
At that point, Clawson pointed out that Penovich was contradicting testimony he had earlier given to a grand jury; he was impeaching himself. The claim touched off a donnybrook involving the lawyers from both sides; the arguing persisted until Judge Wilkerson declared court adjourned. Penovich stepped down from the stand. He had revealed much but kept even more to himself. He had not even hinted at the Capone brothers’ involvement in prostitution, bootlegging, and the violence associated with them, or the smell of gunpowder wafting along the streets of Cicero.
• • •
The next day saw testimony from more gamblers and bookies—some of them “shiny-shoed,” others decidedly scruffy. They talked about the money Al had lost by placing wagers with them, the $500 bets and the $3,000 bets, all of them on losing horses. The most impressive testimony came not from a Chicago bookie, however, but from Budd Gentry, “a breezy sort of personality,” according to one journalist; Gentry worked, or at least passed his days, at Hialeah, the Miami track where Capone spent as much time as he possibly could whenever he was in Florida. Hialeah was as close to high society and respectability as Capone ever came, but now Hialeah, in the person of Gentry, was coming back to haunt him.
Capone Page 67
