Zachary Lazar

by Evening's Empire

  Cornwall told police that Warren, in effect, controlled Great Southwest while Cornwall was its president….

  Meanwhile, Wednesday, Wayne Tangye, chief of the Real Estate Department’s enforcement division, said his boss, Talley, attempted to intimidate him earlier in the day. Tangye said, “He claimed I was spending too much time helping the attorney general’s office in real estate fraud cases.”

  In the end, Tangye said, Talley threatened to fire him from his post.

  Arizona Republic, June 8, 1974:

  Fraud Prober Demoted by Real Estate Director

  Wayne Tangye, an Arizona Real Estate Department official who is helping other state authorities investigate land frauds, said he was demoted Friday by J. Fred Talley, real estate commissioner who is one of those being investigated.

  Talley is the subject of a probe by the attorney general’s Strike Force on Organized Crime. He has denied wrongdoing but refused to answer any questions on the matter.

  Under investigation, according to Ronald L. Crismon, strike force chief, are allegations that monthly cash payments from at least six land sales firms were funnelled to Talley through Ned Warren, ex-convict land promoter.

  Tangye, who has been chief of the Real Estate Department’s enforcement division, said his demotion to “investigator” goes into effect Monday. The demotion notice, he said, directs him to surrender all his records to Talley. These may include records that implicate Talley, Tangye said.

  Although removed from his higher post, Tangye said he will continue to cooperate with the attorney general’s office, “as any good citizen would.”

  The Real Estate Department, Tangye said, already has a full complement of investigators.

  “I was told two days ago by Talley,” Tangye said, “that I was spending too much time with the attorney general’s office investigating land frauds.”

  Tangye said he remains “vitally interested” in the investigations.

  The demotion, Tangye said, means a monthly salary cut of between $300 and $350….

  Arizona Republic, June 8, 1974:

  Land Promoter Called Influence Buyer

  A land promoter who designed and operates a vast network of fraudulent real estate schemes in Arizona has not been prosecuted because he “has purchased too much influence in this community,” the court-appointed attorney for three bankrupt corporations charged Friday.

  The promoter was identified as Ned Warren, an ex-convict, by the attorney, Bruce Babbitt.

  Babbitt was named by the U.S. District Court to represent the trustees for Great Southwest Land and Cattle Co., Lake Montezuma Development Corp. and Educational Computer Systems.

  All three firms were founded by Warren, Babbitt maintained.

  Warren could not be reached for comment.

  Although fraud was involved in the failure of these and other companies organized by Warren, Babbitt charged, “Warren has purchased too much influence in this community” and, therefore, has escaped prosecution.

  Babbitt, a Democratic candidate for state attorney general, made the charge at a political meeting in Sun City.

  “Public records are available,” Babbitt continued, “that paint a vivid picture of how Warren organized the companies, milked the money out and turned them over to his associates to run them into bankruptcy and take the rap.

  “The front men, including James Cornwall,” Babbitt asserted, “have been indicted. But the prosecutors seem unable or unwilling to take on the real problem: Ned Warren.”

  Such large-scale land-fraud rackets as have blighted Arizona’s national reputation for at least the past decade, Babbitt contended, suggest the involvement of “organized crime.”

  “Organized crime,” Babbitt said, requires two ingredients: Sophisticated organizers and the cooperation of public officials.”

  The only way to stop the scandals, Babbitt said, is to conduct “a tough, thorough investigation and prosecution that will root out land fraud and those responsible once and for all.”

  Babbitt suggested the formation of an independent prosecutor’s office which is free of political influence.

  The pattern of land fraud has been “consistent, ongoing and publicly known,” Babbitt asserted, without any serious effort made by public officials to stop it.

  “The pattern began in the early 1960s,” Babbitt recounted, “with the rise and fall of Western Growth Capital and related companies, including Diamond Valley and Snowflake Highlands.”

  Warren organized and directed Western Growth, Babbitt said, escaping any prosecution with the tacit cooperation of “powerful public personalities.”

  Most prominent of those associated with Warren in Western Growth, Babbitt said, was Lee Ackerman, a businessman and former Democratic national committeeman, state legislator and onetime unsuccessful candidate for governor.

  “When Western Growth went bankrupt,” Babbitt explained, “thousands of people lost their investments. They have never been compensated. No one went to jail.”

  The pattern established by Warren in Western Growth, Babbitt said, has been subsequently repeated in connection with the financial failure of other firms organized by Warren.

  So far, Babbitt said, law enforcement officials have bagged only the “front men” in fraudulent land operations, including Lake Havasu Estates Corp.

  Although several of Lake Havasu Estates officers were “convicted by plea bargaining” involving the U.S. attorney’s office last month, Babbitt said, “there is no evidence that the real organizers have been exposed.”

  Such land frauds continue to thrive in Arizona, Babbitt concluded, because “Ned Warren has purchased too much influence in this community.

  “The press,” Babbitt asserted, “has already reported the facts regarding the corruption of an investigator in the county attorney’s office. Two years have passed and nothing has been done.

  “The allegations regarding Fred Talley, state real estate commissioner, also are known,” Babbitt said. “It is also a public fact that Talley’s son has been employed by Ned Warren.”

  (Talley issued Warren a real estate license several years ago, even though Warren was a twice-convicted felon, after Warren hired Talley’s son, James.)

  He had almost fainted when McCracken appeared at his door in the summer of 1973. Before that, Cornwall had spent two years hiding in Europe, mostly in Switzerland. You could do business, buy groceries, but without the language, every conversation was a child’s conversation of half a dozen words. He came back home. He started a new life as a pastor in Newport News, Virginia, head of the Peninsula Rock Church and Proclaim Center, following the path of his father and grandfather and brothers, all of whom were preachers.

  He still didn’t think he’d done anything wrong, so when McCracken found him, he decided to cooperate. He should have trusted Tony Serra before he trusted Lonzo McCracken.

  There was nothing in Ed’s past that could have prepared his father, Lou, for what he had to tell him now. The world was no longer recognizable. His father wore a blue golf sweater and polyester pants and he seemed to barely listen, his hand on the recliner’s armrest, head slightly bowed. Disgust, then quiet. Maybe not even disgust, just incomprehension. Then it was as if it hadn’t happened. As if the money for Talley had never existed. They never talked about it again.

  Warren eased into the pool, grimacing in the sun’s glare as he looked down at the steps beneath the water’s surface. He moved gingerly in, the water rising to his waist, an aging man alone on a Wednesday afternoon, his breasts and shoulders beginning to sag. He ducked down into an awkward crouch, shivering a little, then moved forward, rowing with his arms.

  His problem now was his own fatigue. Since last June, almost four months ago, not a day had gone by without his name appearing in the paper attached to the words “bribery” or “land fraud” or “organized crime.” It required energy to always say “no comment,” to put up a bland front that was not just a matter of pride but of physical safety. He felt himself
becoming vulnerable to his own ego, his own mystique. It was as if he were vying with his son-in-law, Gale, and his son, Ned Jr., in some unannounced contest of vitality. He couldn’t stop it with Charlotte—her crooked teeth, the sheen of stubble on her calves when she came out of the pool. Charlotte had a big mouth, always laughing too loud, breaking her wineglass, flirting with someone’s kid in the middle of a fund-raiser. There would be tears from Barbara, gossip added to the gossip. He and Charlotte would meet the next afternoon for margaritas at the Embassy Hotel. They were the actions of someone who was already starting to lose. He saw this but couldn’t stop.

  Tony Serra, eight to ten years in prison. Warren’s old friend and partner Bill Steuer, dead of carbon monoxide in his own garage. Seven officers and employees of Great Southwest convicted, two of them sentenced to jail time, all put there by James Cornwall. Warren had known Bill Steuer since the 1940s, when they had put together their fake Broadway play, The Happiest Days. He and Steuer had celled together in Sing Sing. Every day there was another article about Sing Sing, about the Talley bribes, the loan to George Brooks. Every day he waited for it to balloon into a federal case.

  He got a call from his lawyer, John Flynn, that afternoon, September 25. Five months of hearings and now they were coming after him for something so dubious and minor that it seemed like a ruse. He’d given a deposition last summer to the county grand jury looking into Great Southwest, then he’d given another deposition to the U.S. attorney. The two statements had inconsistencies. Moise Berger was claiming this constituted perjury. He claimed this even though he knew the statements were made in two different venues and were mutually inadmissible.

  “Perjury,” Warren said. “They’ll get me for jaywalking next.”

  “It’s chickenshit stuff, for the newspapers. Just go through the motions and I’ll try to keep the cost down,” his lawyer said.

  He watched Charlotte move across the dark room through the crowd, her hair like a tattered wig, bare shoulder blades in the halter dress. The red-lit lounge insinuated an outflare of blood. Amyl nitrite, methedrine, cocaine. Chickenshit stuff, perjury, but they were coming for him. He started thinking about someone like Dominick DiFranco with thirteen hundred acres in Yavapai County. That was the way things were moving: an alliance.

  Charlotte entwined her way around John Adamson’s arm at the doorway of the Happy Garden, a swinger and lesbian bar on Indian School Road. Adamson was neuter to her, he knew, one of the big guys who could be counted on to pretend it was nothing, an older brother figure. Adamson drank a quart of vodka a day and sold stolen jewelry out of the trunk of his wife’s car and occasionally he worked a shift at places like the Happy Garden, one of the places Ned Warren ran with Ned Jr. and Gale Nace. Adamson wore two-tone shoes and tinted glasses, even indoors and at night. He bowed his head and made the faintest gesture toward a sheepish grin, and Charlotte banged her open palm against the lapel of his leather coat, confident that she saw right through him, so out of it she didn’t remember she’d been writing him bad checks for the past three months. The checks were his insurance against Warren—that was why he never said anything. If the bad checks ever fell into the wrong hands, then Charlotte would end up having to answer a lot of questions from Lonzo McCracken. For example, how did she get her job at the Happy Garden? Answer: Ned Warren had gotten her the job. How could Ned Warren get her a job at a bar owned by Dennis Kelly? Answer: Ned Warren was the person who actually owned all of Dennis Kelly’s bars. Was it Mr. Warren who ordered the monthly payments to John Adamson’s company, Parking Control Systems? Yes. And what services did John Adamson’s company provide?

  You firebombed a bar with dynamite, or C-2 or C-4 in an amber-colored cylinder with a valve built into the side for the twelve-volt cap. You could firebomb the Happy Garden with a few of these cylinders slotted right into the ends of Dennis Kelly’s tiki torches, but Little Huey’s was in a black neighborhood, so Adamson and Carl Verive used ordinary Molotov cocktails. Maybe the Panthers did it. Black neighborhood, white owner, the Kellys an old Phoenix family. They knew going in that there would be no police investigation anyway, beyond the first perfunctory report for the insurance.

  Verive held the trunk door open with his extended hand, squinting down into it, then slammed it shut on the wadded, gasoline-smeared towels. He weighed two hundred and thirty-five pounds and he had slicked-back hair and a face like Johnny Cash, thick sideburns almost down to his jaw, the long points of his shirt collar hanging out over his jacket lapels. In the trunk was a length of steel cable with taped grips, covered with blood and hair. Adamson had seen it before. That was Carl Verive. It was through Carl that he had met all the other Chicago people—the Pedotes, the DiFrancos, Paul Schiro, Old Man Kaiser. You came into the darkness of the bars and there was always a glass full of red plastic cocktail straws, hushed lighting on the bottles. The Ivanhoe, the Phone Booth, the Scotch Mist, Rudy’s. Adamson had watched them evolve, watched people like Carl Verive and his friends slowly take them over.

  “Honey’s first bar,” he said, when they were back in the car.

  “Who’s Honey?” Verive said.

  “Honey is Dennis Kelly. I told you that.”

  Little Huey’s was barely on fire, but the windows were smashed in and there would be smoke damage. Adamson took a sip of vodka.

  “Honey,” said Carl Verive.

  “It’s what Warren calls him. You never heard that?”

  Verive didn’t look at him. He had settled into his seat, was waiting for Adamson to shut his door before he started the car. He stretched his arm out the opened window.

  He wasn’t real to Charlotte. She would blather at him in her Texas voice, always talking on her phone to someone else, and John Adamson would stand there in the back office with his hands balled together before his groin—John who worked the door, John who striped the parking lots with new white paint. She didn’t know he kept meticulous records in a formal day planner, so that along with the bad checks he had the dates, amounts, and check numbers all written down in case he ever needed them in court. She didn’t know he would be famous some day. They would call him John Harvey Adamson then. They would have to use all three of his names once he had committed his first murder.

  Dennis Kelly came walking into Durant’s one afternoon in a white mesh shirt and faded jeans. He actually screamed when he saw Carl Verive sitting at the bar. Kelly was screaming, Don’t kill me! Don’t kill me! and everyone in the restaurant heard and Adamson had to walk over and calm him down. He was tired of Honey by then, but the last thing he wanted was a public scene.

  They went to the New Town Saloon to talk. They got a booth and Adamson ordered a vodka and he told Kelly to stop fooling around, to pay Warren the $100,000 he owed. He didn’t like chasing Dennis all over town, he had had enough of it. He wasn’t even getting paid for it anymore, as Kelly knew from his own bankbook, where all those bad checks had come from.

  “You should never have talked to McCracken,” Adamson said, leaning forward. “He can’t help you anyway. No one’s afraid of McCracken. They’ve got him boxed in on every side.”

  Kelly’s white mesh shirt seemed to glow against his tan skin. He looked away. They called him “Honey” because he was gay. He was broad-shouldered and heavy-jowled, with the black hair and bushy eyebrows of a car salesman. He ran six or seven bars, and now they all belonged to Warren and Ned Jr. and Gale Nace.

  “Just keep me away from Carl Verive,” he said. He reached into his pants pocket and put a roll of bills on the table in front of him. It looked like about two hundred dollars. “I get the point,” he said, then left.

  Adamson remembered the bad checks from Charlotte and Kelly. He called Warren at his Camelback Mortgage office, but Warren wasn’t there or he wasn’t taking Adamson’s calls.

  The next day, he was subpoenaed to a federal grand jury. The agent identified himself as Clint Brown, FBI, Chicago. He said that Dennis Kelly was in the federal witness protection program. He said that Dennis
Kelly had told him that Adamson and Ned Warren were threatening his life.

  A federal case. Not just McCracken anymore, but the FBI. Not just perjury, but extortion, maybe worse. That’s what Adamson had told Warren. The investigators would have facts and rumors now from every Mafia source from California to New Jersey. Every Mafia source from California to New Jersey would know about the probe.

  One hundred seventy-one known gangsters in Phoenix, arriving over the past ten years, a kind of invasion. Warren had watched Ned Jr. start to emulate their style. Ned Jr. had come back from Vietnam and then spent fifteen days in Pima County Jail for assault, acting just like a muscle. Gale got hooked on the idea of himself as Sonny Corleone. It had never been Warren’s style. He had always told people that he lived by his wits, not by “fists or hard-guy attitude.” He set Junior and Gale up with some bars. He tried to help them out. He bought Junior the Broken Arrow, on North 7th Street, and the bar became a money loser, a place Junior used mainly as a place to sleep with the help. Eventually they sold it off to Dennis Kelly and made Kelly a partner. Kelly took out a loan then to turn the old Roman Gate Cocktail Lounge into the Happy Garden, and as a favor Warren assigned the loan to Gale. That’s when the threats began. It took about three months before Kelly realized that he owed Warren and Gale everything he had, and that Gale was determined to break his legs.

  Warren ordered a French dip and a Dry Sack to sip on while he waited. It was October 2, a week after his first indictment from the county, the feds now involved, a vulnerable time. The restaurant was dimly lit and the table’s thick, coffee-colored wood had a deep grain that felt good beneath his hand. Applegate’s Olde English Pub was another place the mobsters liked. Adamson showed up when Warren was half finished with his lunch. He was followed by Carl Verive, whose mustard-colored jacket bulged open to reveal the girth of his trunk. The room, with its brass and dark carpets, became vivid, slow-moving. Verive took a seat at the wood-paneled bar and Warren picked up his sandwich end and dunked it in the au jus sauce. Adamson sat down on the banquette across from him, his big head seeming to teeter on his neck as he hunched in—sunglasses, open-neck shirt, a turquoise bracelet around his wrist.