Supermob

by Gus Russo

  * Interestingly, the agency source of the above memo is deleted, which usually implies CIA. The memo contains fifty-two more pages, currently withheld for review by that other agency. One guess is that it involves CIA investigations of laundered Mafia money coming from Italy.

  ^The Brink's Job was based on a true story that occurred in 1950. The period piece was shot in the North End of Boston, which was at the time dominated by Italians and Irish, and problems first arose when residents refused to take their TV antennas down, even for a few hours—television antennas did not exist in 1950. Universal production chief Ned Tanen called Lew Wasserman, who in turn called the Fixer. Two hours later, Tanen received a call from the unit producer. "You want to see something funny? You ought to see these 280-pound Italian women climbing up on their roofs, tromping around in their black skirts and work boots, ripping out their TV aerials." As Tanen later noted, "Now there's nothing dishonest about that. But Lew had called his good friend Sidney, and they had got it done." The film received an Oscar for set decoration—although it is doubtful that Korshak ever received a statuette. (Sharp, Mr. and Mrs. Hollywood, 351-53)

  *Just above his signature, the form reads, "False statements made knowingly and willfully in passport applications or other supporting documents are punishable by fine and/or imprisonment under the provisions of 18 USC 1001."

  CHAPTER 19

  Airin g Dirly Laundry and Laundering Dirty Money

  LESTER VELIE, ROBERT GOE, Art White, Sandy Smith, Frank McCul­loch, Jack Tobin, and Paul Steiger had all taken their best shots at Sid Korshak. Now the gauntlet would be passed to a red-hot firebrand of a journalist who was certain to find any dirt that was there to be found. It was inevitable that the two would be pitted against one another: Sidney Korshak, the immovable object, and Seymour Hersh, the irresistible force.

  Sidney and Seymour

  Hersh, at just thirty-nine years old, had already established himself as one of the most respected and most persistent investigative reporters of his time. Born and raised in Sid Korshak's Chicago, "Sy" Hersh entered the journalistic fray as a police reporter for the Chicago City News Bureau and later worked for the national wire services, before a sabbatical in 1968, when he was the press secretary for Senator Eugene McCarthy's antiwar presidential bid. Hersh's investigative talents first gained national prominence in November 1969, when he broke the story of the My Lai massacre in Vietnam, earning him a Pulitzer Prize for international reporting as well as several other prestigious awards.*

  Hersh parlayed that acclaim into a full-time reporting job at the New YorkTimes, where he quickly delivered another bombshell with the disclosure of the CIA's massive illegal domestic mail-opening scheme known as MH/ CHAOS. By 1976, Hersh had earned the enviable position of being able to name his assignment at the most prestigious paper in America. During a rare lull in his frenetic activity, Hersh began sounding out colleagues for ideas about how on earth he could top his own reputation with his next expose.

  "I got to know Peter Adelman and Adam Walinsky because they were doing the same things for Bobby [Kennedy] that I did for McCarthy," Hersh said in a recent rare interview, "writing speeches and being a press guy. So I was looking for things to do and somehow I bumped into Adam and he said, 'If you want the great story of all time, I'll give it to you. Two words: Sidney Korshak.' 1

  New Yorker Adam Walinsky, the same age as Hersh, was at the time an associate in the firm of Kronish, Lieb, Weiner & Hellman. In 1963 he had gone to the U.S. Department of Justice under Attorney General Robert F. Kennedy, where he worked on the drafting and passage of the Immigration Reform Act of 1965, the Civil Rights Act of 1964, the Economic Opportunity Act of 1964, and matters of crime and national security, later becoming Kennedy's legislative assistant.

  "What I got to hear about Korshak was from Walter Sheridan," Walinsky remembered. "Sheridan was the guy who told me a lot of stuff about the rackets, and Korshak was obviously a really major figure. We talked about that and the information that had come out in the committee's investigations of organized crime. The one thing I said to Sy is that you don't want to import today's sensibility and bring it back thirty years, because to actually go after a guy like Korshak back in those days would be a much bigger deal than it would be today. He was a really serious player and he was a guy who could pick up the phone and call the publisher of the Times and all of that."2

  Hersh said that Walinsky sent him to meet with Sheridan, who in turn gave him the background on the murky world of labor rackets, sweetheart deals, and Sid Korshak's central role in them. Sheridan advised Hersh to pay a visit to Berkeley, California, to learn more from freelance journalist Jeff Gerth, with whom Sheridan had floated an unsuccessful 1973 book proposal on the Korshak crowd. Gerth was currently defending himself in the largest libel lawsuit ever brought before a U.S. court, brought against him and others by a group headed by the Supermob's Moe Dalitz, Korshak's closest pal in Vegas. Just a year earlier, Gerth had teamed with fellow freelancer Lowell Bergman* in writing "La Costa: The Hundred-Million-Dollar Resort with Criminal Clientele," for the March 1975 edition of Penthouse. The piece exposed the resort, owned by Dalitz, Roen, Adelson, and Molasky, or DRAM, as a mob-friendly, upscale version of the Acapulco Towers right here in the United States. As Penthouse's lawyer Roy Grutman wrote, the allegations were hardly news, but nonetheless, this time DRAM fought back with a $630 million libel suit that would drag on for an astounding ten years.3

  "I just liked him right away," Hersh said of Gerth, "and I said, 'Come work with me.' He said okay' " For the next six months, with Gerth credited as researcher, the duo would plumb sources from coast to coast in their attempt to unravel the Korshak mystery. It was a massive undertaking, one of the biggest ever for the Times, and certain to be a front-page multipart account.

  Armed with a $30,000 budget, the new partners made an initial research trip to Reno, Nevada, where they learned what it meant to "dig up" a story. "We met this retired FBI guy in Reno," Hersh recalled, "and we went out to his cabin somewhere, and there he had this great document—later it was unfortunately stolen. It was about a 250-page FBI dossier on Korshak that was incredible. We published the gist of it; we leaned on it a lot. He gave us that document, but I remember we had to go out to his farm and dig it up, literally."

  From there, the pair moved on to Jack Tobin, who gave them his LAPD sources. In Chicago, they read a clipping of how Korshak had sided with Joel Goldblatt's ex in a divorce proceeding. "We figured Goldblatt might be mad," said Hersh, "so we found him, remarried to a younger wife, living in the Near North on Lake Shore Drive." Another Goldblatt ex, MJ Goldblatt, remembered that Joel began receiving calls from Korshak friends before Hersh arrived in Chicago. "Don Maxwell of the Tribune warned Joel not to give the interview to Hersh, but he did it anyway," said MJ.4

  When Hersh and Gerth arrived at the Goldblatt abode, they found a man bursting to talk. "He was very wealthy, and very angry," remembered Hersh. "He made us promise to protect him and he dumped everything on us."

  Goldblatt told them, among other things, that he had seen Korshak's compromising photos of Estes Kefauver back in the early fifties. However, Gold­blatt remained an unnamed source when the story ran.

  The assignment was not without the occasional reminders of Sid Kor­shak's long reach. Near the top of the list is this one, as recounted by Hersh: "Best story I can tell you: I'm into the story about six months, or four months. I'm living in New York, my wife's in med school, when we get a call from the district attorney of L.A., John Van DeKamp. He says, 'Get to a pay phone.' 'What do you mean?' I say. 'Just get to a pay phone.' So I leave my kids—I'm making hamburgers for my kids, seven and five [years old]—and go down to the corner candy store, I call him collect. He says, 'Korshak has all of your phone records and all of your expense accounts from inside the Times.'" A former Times employee who wished to remain anonymous explained that L.A. District Attorney's Office investigator Frank Hronek later told the pair how Korshak had done it. "One
of Hronek's sources said that Korshak got the records from one of Korshak's contacts in the Times payroll department," said the insider. "The Times later did an investigation and found him—it was a guy from Chicago, but they chose not to prosecute him.5 Thus alerted, the reporters began submitting phony expenses and proceeded onward.

  Before the story ran, Times executives began getting letters from the Wyman, Bautzer law firm, written by Greg Bautzer. "Your man's been going around saying terrible things about my client," said one. "You're calling him names, he's never been found guilty of anything." Hersh called them "standard, good lawyer letters."

  Of course, Hersh attempted to speak with Korshak during the research phase, but was unsuccessful. Jan Amory, Del Coleman's ex-wife, remembered historian Arthur Schlesinger trying to broker an interview when all the parties were dining at the same New York restaurant. "I remember Schlesinger saying to me, 'Would you introduce Sidney to Seymour Hersh? I know you're having lunch with Sidney at the Grenouille, and Hersh is dying to meet him.' I said, 'You mean he's never met him?' And he said, 'No, and he just wants to come over to the table.' And I said, 'No, I'm not going to compromise Sidney like that, I'm not doing it.' I just thought it was too tacky."6

  Although Hersh and Gerth wrote that Korshak declined to be interviewed for the piece, the true story was far more interesting, and sinister. "I called Korshak one day, and he took the call," Hersh vividly remembered. "This was late [in the process]. I was in West L.A. and called from a pay phone. I said, 'Mr. Korshak, I am here.' He said, 'I won't see you.' Then he said, 'Mr. Hersh, let me ask you a question'—I'll never forget it as long as I live—'What are you doing? You're an expert in mass murder, you write about crimes where people are dead and there are bodies all over. Why are you writing about me? You write about murder.' He kept on talking about murder. 'Blood running in the ditches, and murders.' He just kept saying, 'You write about mass murder. Why are you interested in me? I'm just a businessman, and you write all these terrible things. Go back to your mass murderers. Go back to the blood and the killings and gore, that's what you write about. Not about me.' It was very interesting what he did. He just kept talking about murders and blood. He never said a word that was threatening, but the whole context was 'murder, murder, blood, murder'—you couldn't finish the conversation without realizing that . . . it set me on edge, as it should've. It was pretty chilling. His whole message to me was very subliminal, or so I thought—maybe that's the way he talked to everybody. That was the extent of contact with him." Tom Zander, the Chicago-based crime investigator for the Labor Department, insisted that Korshak's veiled threat was not uncommon. "That's the way he talked," said Zander. "He was not beyond anything, believe me."7

  Internally, the story proved a world-class headache for the Times and its publisher, Arthur Ochs "Punch" Sulzberger, who constantly rode Hersh's back for sourcing and accuracy. At least two top Times executives voted to scuttle the series altogether.8 With Ziffren and Bautzer making their presence known, Sulzberger enlisted an army of attorneys to vet the first draft. Later, Hersh learned of another reason for Sulzberger's sensitivity. "[Executive Edi­tor] Abe Rosenthal told me that Korshak knew Punch," Hersh said. "They used to go to the movies together. Charlie Bluhdorn used to show private screenings at his house and Punch would go with Sidney once in a while."

  Interestingly, on the eve of the series' scheduled May 1976 debut, a Teamsters strike hit the paper. Hersh wondered if Sidney was sending another subliminal message. When the front-page "above-the-fold" series finally opened, three hundred interviews later, on Sunday, June 27, Hersh noted that Korshak's hometown paper didn't even mention it. "The L.A.Times didn't touch it," said Hersh. (Apparently, Korshak's $25,000 contribution to the Los Angeles Times' Buff Chandler in 1969 still counted.) "But Pacifica [Radio] ran it twenty-four hours a day," Hersh added. "They read it aloud. They read it around the clock."

  The opening salvo was entitled THE CONTRASTING LIVES OF SIDNEY R. KOR­SHAK: SUCCESSFUL CALIFORNIA LAWYER IS CALLED LINK BETWEEN CRIME AND BIG BUSINESS. The hard-hitting broadside included allegations of fixed judges, blackmailed senators, labor racketeering, Teamsters Pension Fund abuses, tax dodging, etc. Although many of the charges were unproven, the sheer extent of them made it seem as though the 1969 Los Angeles Times article had been circumspect in the extreme.

  In Chicago, on the very night part one hit the newsstands, the sixty-nine-year- old Korshak was rushed to Michael Reese Medical Center after a flare-up of diverticulitis, or inflammation of the colon caused by too much low-fiber food. He was reported in fair condition.9 Although one might conclude that stress from the Hersh affair had brought it on, it may have been just coincidental, since most internists now believe that stress plays no role in the illness. (Three years earlier, Korshak had spent four days in L.A.'s Cedars of Lebanon Hospital with a stomach inflammation that saw his white-blood-cell count soar to twenty thousand, over twice the norm, due to a bleeding ulcer. The incident left Korshak depressed and telling a friend that he "might as well be dead" if he couldn't eat and drink what he wanted.) "Sidney had a lot of stomach problems," said friend Leo Geffner. "He had to watch what he ate. He was very careful not to eat spicy or rich foods."10

  Unbeknownst to Geffner and Korshak was that while Korshak recuperated at Michael Reese, the FBI watched all his phone records and attempted to monitor his visitors.11

  The Fall out

  As might be expected, the Times' Korshak series provoked reaction and fallout of all manner. Even before the series concluded, Greg Bautzer fired off a telegram to the Times complaining that he had been taken out of context in the first installment. Bautzer said that he never meant to imply that Sidney might have had early ties to the Outfit. "I never knew Mr. Korshak in Chicago," wrote Bautzer, who claimed that he told Hersh, "If he had represented these men, and it was conceivable that he did, I was unaware of it; that during all of my association with, knowledge and observation of Mr. Korshak while he has been residing in California, I found him to be a lawyer possessed of intelligence, integrity and loyalty."12

  The series also drew the attention of Hersh's fellow journalists (except in Korshak's adopted hometown, where the Los Angeles Times did not even acknowledge the articles). Predictably, Korshak friends such as Irv Kupcinet and Joyce Haber excoriated the Pulitzer-winning writer, labeling his work nothing less than character assassination. Most surprising was the response of respected New York columnist Nat Hentoff, who wrote that Hersh had "set out to get Sidney Korshak . . . Tom Jefferson may not have had this mouthpiece [Korshak] precisely in mind when he envisioned the democratic populace two centuries hence, but he could not have excluded him even from the Bill of Rights." Hentoff, a respected civil libertarian, went so far as to call for the prosecution of federal officials who had leaked government documents to Hersh.13

  Other peers, such as Denny Walsh of the Sacramento Bee, supported Hersh's work, even though it was long on inference and short on hard proof of Korshak criminal activity. "Men like Korshak deserve all the publicity they can get," Walsh told New West. "Sy Hersh did a public service by getting all the information on Korshak in print."14 Many seemed to think that Hersh was employing the same strategy that had led to his Pulitzer-winning My Lai revelations and his series on CIA abuses, which had begun with unfocused scattershot allegations that eventually prompted key witnesses to come forward with the complete stories. "This is exactly the strategy that paid off in Sy's CIA series," said Frank McCulloch. "I have the utmost respect for Sy and the Times. I hope he keeps on digging."15

  Regarding the provocative Kefauver blackmail story, a number of Kefau­ver's senior staff, such as Organized Crime Committee counsel Downey Rice and investigator George Martin, wrote letters to Sulzberger, Hersh, and the U.S. Senate, protesting what they believed were gross inaccuracies in the Kefauver story. Senator Thomas Mclntyre (D-New Hampshire) inserted a scathing letter from Rice and Martin into the Congressional Record, which stated in part that Hersh's "sole objective seems to be t
o disparage, distort, denigrate, and defame."16 Historian William Howard Moore of the University of Wyoming was among those who seized on minor errors in the piece (such as the date and reasons for the Kefauver Committee's postponement of Chicago public hearings) to say that Hersh was therefore also wrong about Korshak's blackmailing of Kefauver.17 Six years later, Moore expounded on this in an article in the journal Public Historian.18 Most of the protesters assumed that Hersh's source for the allegation was an underworld type. They never learned that it was in fact Joel Goldblatt, one of the most respected businessmen in Chicago.

  In response, Sulzberger not only wrote letters in defense of Hersh, but printed an editorial on July 1, in which he stated that the articles "clearly demonstrated" that there was "a great deal of evidence—much of it already in the hands of federal agencies—that would have warranted an indict­ment" of Korshak. Sulzberger ended by saying, "Mr. Korshak is surely one of the people who have been involved in building links between organized crime, labor unions and corporations. His career . . . strongly indicates that major reforms are needed in the administration of criminal justice and corporate law."19

  Among the more suspicious of the postpublication occurrences was the discovery that all the voluminous work files compiled by Hersh and Gerth turned up missing from the Times storage facility—files that might have insulated them from potential legal actions. "We were all very upset at the time. There were huge files, they were excellent," said Hersh, who believed the files were accidentally lost during a Times storage relocation. "Jeff has his doubts, but they were really moving, and there were renovations, and they disappeared during the moving. I think it was just stupidity."