by Tim Newark
“Sure,” Lanza said, nodding, “I’ll help the war effort. I got contacts in the fish market and fishing boat and barge captains and seamen all along the Atlantic coast.”
A week later, Lanza was ushered into the plush surroundings of the Hotel Astor, where Commander Haffenden had set up his offices. The mobster was told that he was volunteering his help and that no deal had been made with the DA’s office. The government would stick by this—having got his assistance, the following year Lanza was sentenced to fifteen years in jail for racketeering.
In the meantime, Lanza proved helpful. He got union cards for naval agents so they could work on boats and monitor the Italian fishing community. The agents installed telephone equipment on the boats and used them as part of a submarine lookout system. Sometimes the boats picked up remains of wreckage—even bits of human bodies—indicative of the savage war at sea. Naval agents also worked on the trucks delivering fish from the coast to Fulton Fish Market, all the time gathering information from gossip and rumor.
By April 1942, Lanza had helped Haffenden as much as he could. Suspicion hung over him because of his pending indictment and senior mobsters were reluctant to talk to him. Lanza went to his attorney and explained this, saying that if Naval Intelligence wanted to get the complete cooperation of New York’s underworld, they had to go the top—and that meant talking to Charlie Luciano.
“If he came into this picture,” said Lanza, “I’ll get all the cooperation from various people in the City of New York. He’d send some word to Joe Adonis or Frank [Costello]. The word of Charlie [Luciano] would give me the right way.”
When MacFall and Haffenden heard this, they shrugged and agreed. MacFall had already crossed the line of talking to criminals and Haffenden could deal with any mobster put his way. Sometimes the collusion brought extra benefits. In the same year, as a result of his underworld contacts, Haffenden was able to defuse a major scandal when the New York Post claimed Senator Walsh, chairman of the naval affairs committee, had been spotted in a “house of ill fame” run by a German who was suspected of being a spy by the FBI and charged with trying to get information from navy personnel. It could have been a serious lapse of security, but by talking to the mobsters who ran the brothel, Haffenden furnished the real identity of the elderly gentleman and a damaging scandal was avoided.
So far, in this story, it appears that it was the idea of Naval Intelligence to recruit mobsters and to take this a stage further by talking to gangster No. 1, Luciano. But is this true?
Meyer Lansky was already very aware of what was going on because Lanza was simultaneously reporting back to him on his dealings with Naval Intelligence. “Joe Socks [Lanza] did the right thing by coming to me,” he recalled. “Gurfein’s move had been even shrewder than he realized, because Lucky and I were close to Lanza ourselves. We got him out of a lot of trouble when he was a boy, and he never forgot how we helped him.
“Lanza told me,” said Lansky, “that the Italian people around there [the waterfront] thought that he had a personal motive. They didn’t believe him that it was a movement that all Italians should get interested; and he asked me to take him up to Charlie Luciano, and if Charlie Luciano would send word to these people he thought that resistance would stop.”
But is it possible that Luciano and his associates had already set the groundwork for this deal by heightening the government’s sense of wartime fear? Is it possible that they could have been responsible for acts of destruction made to look like enemy sabotage? Even more sensationally, were they behind the burning of the Normandie?
The Last Testament of Lucky Luciano has long been criticized as more invention than truth, and many of its stories, supposedly from the mouth of Luciano, do not fit in with the facts that we know. But sometimes contained within its pages are nuggets of information that make one wonder where the authors got them from, if not from the gangster chief. The book was first published in 1975, four years before the appearance of Meyer Lansky’s memoir and two years before the secret government report on the whole wartime affair was widely publicized in Rodney Campbell’s The Luciano Project.
The Last Testament claims that Luciano himself devised Operation Underworld in December 1941. He pitched the plan to Lansky and Frank Costello. Costello said they had contacts at the Third District headquarters of Naval Intelligence at 50 Church Street and would pursue it. Luciano waited more than a month but got no positive response. He had suggested to Costello that what they needed was a front-page act of sabotage to underline the need for his help. With this in mind, one of his top hit men, Albert Anastasia, came to him with own plan. He said he’d been watching the Naval Intelligence agents on the waterfront, worrying about security, and thought that if something big happened, it would tip them over the edge into doing a deal with anyone.
“Albert figures that if something could happen to the Normandie,” says Luciano in The Last Testament, “that would really make everyone crap in their pants. It was a great idea and I didn’t figure it was really gonna hurt the war effort because the ship was nowhere near ready and, besides, no American soldiers or sailors would be involved because they wasn’t sendin’ ’em no place yet. So I sent back word to Albert to handle it. A couple of days later, I hear on the radio where the Normandie was on fire and it didn’t look like they could save her. That goddamn Anastasia—he really done a job.”
It is an incredible claim and would invite derision but for the fact that Meyer Lansky later corroborated the story in his more respected memoirs. He says that after talking to Haffenden, who was still shaken by the Normandie incident, he guaranteed there would be more incidents of sabotage on the waterfront. He passed this on to Frank Costello.
“The message went to Albert Anastasia too,” recalls Lansky, “and I told him face to face that he mustn’t burn any more ships. He was sorry—not sorry he’d had the Normandie burned but sorry that he couldn’t get at the Navy again. Apparently he had learned in the army to hate the Navy. ‘Stuck-up bastards’ he called them.”
This certainly backs up Luciano’s story, and Lansky’s memoirs are generally regarded as coming from the mouth of the man himself. However, the reference to Anastasia’s hatred of the navy comes straight from The Last Testament and there is no other information in the Lansky book to elaborate on the tale first related by Luciano. Generally, Dennis Eisenberg and the other authors of Lansky’s recollections are uncritical of The Last Testament and quote widely from it. If The Last Testament is nonsense and yet they put a story directly from it in the mouth of Lansky, it casts doubt on the veracity of this source, too. Or—the story is true and Anastasia torched the ocean liner. What we do know from the U.S. government’s own investigation is that the burning of the Normandie was one of the main contributing factors for making them talk to Luciano and his associates.
Negotiations with Luciano began in April 1942. Murray Gurfein arranged a meeting with Moses Polakoff, an attorney who helped defend Luciano against Dewey in 1936. At first, Polakoff wasn’t interested in revisiting the Luciano case, but Gurfein underlined the national importance of his proposal.
“We want to set up a network of informants among the Italian element concerning any information about sabotage,” he explained. “We want the help of Italian fishermen who operate fishing fleets, concerning any possible enemy submarines off our shore.”
Polakoff was a veteran of the U.S. Navy from World War I and was sympathetic to Gurfein’s request. “But I don’t know Luciano well enough to broach the subject with him,” he said. “But I do know a person who I have confidence in and whose patriotism, or affection for our country, irrespective of his reputation, is of the highest.”
Polakoff was talking about Meyer Lansky, who had already demonstrated his anti-Nazi credentials by attacking their American supporters in New York on behalf of the Jewish community. Lansky was happy to receive the call.
Over breakfast at the Longchamps restaurant on Fifty-seventh Street, Gurfein, Polakoff, and Lansky met. Gurfei
n told the mobster that the government was fearful of sabotage and Lansky said he was ready to help, but they had to tread carefully, he warned, because many Italians supported Mussolini and they didn’t want to alienate this community. Then the conversation came to the point of the meeting—Lucky Luciano.
“Can we trust him?” asked Gurfein.
“Sure you can,” said Lansky. “His whole family is here—his father and two brothers and sister with children.” It sounded like a Mafia-style threat, but what he probably meant was that Luciano was rooted in the city and would want to protect it. Lansky was certainly warming to the idea and could see the potential benefits for Luciano. He suggested visiting Luciano in prison in Upstate New York at Dannemora. Polakoff winced.
“Snow’s still on the ground up there,” the attorney complained, “and traveling is too hard.”
They then discussed having Luciano transferred to a more convenient prison. Lansky was delighted, knowing this would please his friend very much—anything to get him out of Siberia. At the end of the meeting, Gurfein emphasized the point already made to Lanza that no payment in kind was to be offered to Luciano for his services. He would simply be doing his patriotic duty. Lansky accepted the proviso. With the ground rules laid, the three walked along to the Hotel Astor, where they were introduced to Commander Haffenden.
The gruff naval officer in his uniform made a strong impression on Lansky. He was well informed on Lansky’s criminal career but also about his action against the Nazi Bund. He told the mobster that what he was about to say was top secret and he must keep it to himself. He said a large convoy of American troops was being sent overseas imminently and he wanted them protected—no word was to leak out from the men working on the docks. Haffenden repeated their fear following the burning of the Normandie.
“Haffenden told us where we were weak,” remembered Lansky. “Where he felt the government needs lots of assistance such as the waterfront; pertaining to loaders of ships; employees on the docks; receiving knowledge as to fishing boats—whatever they do in their movements outside; and he wanted people that could be of assistance in that way so that nothing is brought out to any submarines.”
Lansky pledged his support and after the meeting told Frank Costello and Albert Anastasia to cooperate fully with the Naval Intelligence agents. Lanza wondered if they could start charging the U.S. Navy for their services, but Lansky slapped him down, telling him to expect nothing and to pay for his own expenses. He was doing it as a patriot and for the good of his boss—Luciano.
Already the deal began to bear fruit with the transfer of Luciano from Dannemora to Great Meadow Correctional Facility in Comstock on May 12, 1942. Not only did it sound better, it was much more comfortable and more convenient. He had hot water in his cell and decent toilet paper for the first time in six years. Luciano was delighted, even though he didn’t know why he had been moved. The transfer was buried within the movement of other inmates, but the commissioner of the New York State Department of Correction was well aware of its purpose when he waived the need for the fingerprinting of Luciano’s prison visitors. It was the least he could do, he said, if it saved the life of just one American serviceman.
Luciano’s move between prisons did not go unnoticed, however, and the FBI was intrigued by what was going on. No one gave them the full details of the wartime deal and this frustrated their chief, J. Edgar Hoover, who resented being kept out of the loop. The FBI conducted its own report on Luciano in Great Meadow prison, concluding he was “dominated by restlessness and craving for action” but he was “able to get along with his fellow inmates.”
Sometime in late May or early June, Lansky and Polakoff took a train to Albany and then drove sixty miles north to Great Meadow, near Comstock. When they turned up, Luciano was surprised to see them. “What the hell are you fellows doing here?” he said. Lansky handed him a package of his favorite kosher food, including pastrami and pickles, with Italian pastries for dessert. While Luciano ate, Lansky explained the government deal to him. He said there was no guarantee of anything, but it had to be of some value in knocking time off his sentence. As it stood, Luciano had no chance of parole until 1956 at the earliest. There was no alternative. Luciano wanted to know what Frank Costello thought of it. Costello agreed he should help the war effort. “We convinced Charlie that it was a duty of us to give assistance,” said Lansky.
But still Luciano had one major doubt. He wanted the whole deal kept secret. Since he had been sent to prison, a warrant of deportation hung over him. “When I get out,” he said, “nobody knows how this war will turn out—whatever I do, I want it kept quiet, private, so that when I get back to Italy I’m not a marked man.” The punishment for breaking the Mafia code of omerta was, as always, death. “If he were ever to be deported,” said Lansky later, “he might get lynched there.”
Haffenden reassured Lansky that everything would be done to keep the identity of those top mafiosi working with the government secret and that each personality would be assigned his own code name so nothing would appear in official documents. In return, Luciano gave the go-ahead for his henchmen to give every assistance possible to Naval Intelligence. Lansky was to be his chief go-between and they had at least twenty more prison meetings on this subject from May 1942 to August 1945. As a result, Lansky could present a very clear guarantee to Haffenden and his team.
“There’ll be no German submarines in the Port of New York,” Luciano boasted. “Every man down there who works in the harbor—all the sailors, all the fishermen, every longshoreman, every individual who has anything to do with the coming and going of ships to the United States—is now helping the fight against the Nazis.”
Other top gangsters visited Luciano in prison, including Joe Adonis, Willie Moretti, and Frank Costello. They were always accompanied by Luciano’s attorney, Polakoff, who arranged all visits in advance. According to the agreed arrangements, only Polakoff had to sign the prison register. The visitors were then taken to the prison warden’s office, where they would wait until Luciano was brought up from his prison cell. The meetings took place in a large room next to the warden’s office. Two guards waited outside the room. The door was locked. Inside, Polakoff sat at the far end of the room so he could not overhear the whispered conversation and usually read a newspaper. The visits took place around 9:30 or 10:00 A.M.
Word was passed on to some of Luciano’s toughest enforcers that they were to be deployed in the service of the navy. Johnny “Cockeye” Dunn had a formidable reputation as a racketeer and was sent around dockside bars to see if anyone was blabbing about troop movements.
“Dunn’s job was to be a watchdog on the piers,” said Lansky, “to have trusted employees amongst the loaders to seek out employees—to make friends with the crew and to stay with them to get reports if there was any bad men around the crowd. He also got friends along the waterfront in the bar rooms. If any of the crews got drunk and they would talk something that you feel is subversive, to report to him.”
On one occasion, Dunn got the message that some suspicious characters—possibly German agents—were staying at a waterside hotel. He visited the two gentlemen and they were never seen again. Naval Intelligence was a little worried by these methods and asked him to clear any such incident with them first.
Gangster John McCue was released from Sing Sing after serving ten years for murder and became chief henchman for the president of the International Longshoremen’s Association. When any of these workers threatened to disrupt the war effort, McCue broke their arms or legs. Harry Bridges was a no-nonsense union leader from the West Coast. When news spread that he was intent on coming to New York to clean up activities there and organize a strike, Haffenden asked Lanza to sort him out. Lanza personally gave Bridges a beating and later phoned Haffenden to tell him “everything is under control.”
At first, some naval agents had their doubts about working so closely with criminals. Lieutenant Anthony J. Marsloe was one of the young Naval Intelligence officer
s charged with processing the information provided by Luciano. “I felt a certain amount of skepticism,” he said, “because I felt that since they had not been good citizens it was doubtful as to whether they would be of constructive service to our war effort.” As the war progressed, Marsloe became more of a realist. “Intelligence, as such, is not a police agency. Its function is to prevent. In order to prevent, you must have a system; and the system, in its scope and attitude must encompass any and all means … . By any and all means I include the so-called underworld.”
But Marsloe had a point—the reality of the situation was that Luciano’s alliance with the government not only provided some security for the navy but also enabled him to carry on running his criminal business from behind bars. In fact, it strengthened his authority, as Lansky was allowed to shuttle back and forth to his prison, passing on information and relaying instructions from him.
By buying into Lanza’s original statement that Luciano was the chief mobster they needed to talk to, the government was enhancing his reputation as a master criminal. It served their purpose as much as his, or perhaps more so, to show that they were dealing with the most important mobster in order to win the war. They would have to justify this association in due course and they could only do that by making it clear that they were going to the very top—and that was Luciano. From this point onward, government agencies would always regard Luciano as the underworld kingpin and this view of him would continue long after the war ended—whether it was true or not. This wartime alliance was undoubtedly the key event that turned Luciano into an underworld legend.
