ORGANIZED CRIME'S GRIP ON ONTARIO

Alan Phillips September 21 1963

ORGANIZED CRIME'S GRIP ON ONTARIO

Alan Phillips September 21 1963

ORGANIZED CRIME'S GRIP ON ONTARIO

Between 1958 and 1962 the Mafia took a stranglehold on major crime in Ontario. Then police here and in the U. S. jailed the leaders. But the organization is alive, ready to break out

Alan Phillips

THE MAFIA PART TWO

IN MARCH OF THIS YEAR a respected jurist. Justice W. D. Roach, brought down a report on organized crime in Ontario, the result of a royal commission inquiry last year. Its task was to ascertain the facts, to arouse or allay concern, and its aim — enlightening the public, not imprisoning offenders — should have permitted those facts to be studied from the broad view of reason rather than the narrow confines of law.

But logic — cause and effect — is what is lacking in this report. Its detail, though incomplete, is clear;

its conclusions arc incomprehensible. Mr. Justice Roach found no evidence of corruption in the government. He found no organized crime except in gambling. He could find no syndicated crime, no evidence “that any of the activities of those engaged in organized crime were in any way associated with the Mafia.” He thus reaches conclusions remarkably similar to those of Kelso Roberts, the former attorney - general in the Ontario government which appointed him. Just before the commission was set up. Roberts had stated emphatically that Canada was “comparatively free of organized gangsterism," that linking the Mafia with crime in

Ontario was “ignorance and loose talk,” and that the Mafia, indeed, "was pretty well eliminated in Italy itself” by Mussolini.

The effect of the Roach report, then, was to allay public concern, and this, after fifteen months of investigation by the commissioner and his staff, by a special squad of provincial and federal police, and a dozen lawyers in three political parties, should be but is not the end of it.

As it happens, I had begun this study for Macleans a month before the commission was announced. The announcement promised to answer our questions for us: we dropped our study. The probe end-

ORGANIZED

CRIME

ed. Our questions remained unanswered. Once again we began to assemble data. The information we have gathered contradicts the assurances held forth by Kelso Roberts and Mr. Justice Roach. There is evidence of syndicated crime in Ontario. There is reason to associate this criminal activity with the Mafia, the transplanted secret society that has grown so powerful in Sicily since its “elimination” by Mussolini that last May the Italian government convened a special anti-Mafia commission. There is cause for concern, and not only in Ontario. A crime syndicate, like its legal business counterpart, is governed by the dynamics of personal ambition and corporate growth. Once established it seeks continually to expand.

THE NOW FAMOUS 1957 conference of Mafia leaders at Apalachin, New York, had far-reaching consequences for Ontario. It was attended by men high in the international drug traffic, and it is the drug traffic — unmentioned in the Roach commission’s report — that explains how the crime cartel came to Toronto.

The hub of the cartel in the east of North America is the New YorkBrookiyn-Jersey complex. The leaders or “dons” of these criminal groups control the eastern seaboard. They share Miami, the middle and far west with two other powerful groups, Detroit’s Licavoli syndicate (the former Purple Gang) and Chicago’s Accardo syndicate, still known as the Capone mob. Since 1952 the eastern hub has held'Montreal (Maclean’s, Aug. 24) through a Brooklyn syndicate member, Carmine Calente.

At the time of the Apalachin conference the ruling don of New York was Vito Genovese, a gnomelike, enormously energetic rackets’ organizer who has escaped the electric chair only through the untimely death of a witness. As a wartime black-market chief in Italy his assignments for Mussolini included at least one assassination and won him the Commendatore del Re, Italy’s highest civilian honor. He is worth, by reliable estimates, thirty to fifty million dollars. In New

Jersey the dominant power at the time was a little-known gangster named Gerardo Catena. In Brooklyn it was the equally unobtrusive Joseph Profaci, head of a large cheese and olive-oil company, who died last year. Profaci was board chairman of two syndicates, one run by Giuseppe “Joe Bananas” Bonanno, once a machine gun runner for the Capone mob in Chicago, now a businessman in Brooklyn with a cheese company in Colorado and large real-estate holdings in the midwest.

At that time, November 1957, Genovese and Bonanno, with Profaci in the background, had the lion’s share of the wholesale trade in drugs in North America. Bonanno supplied Chicago, the midwest and parts of New York. Genovese supplied New York also, the southwest and Detroit.

None of Detroit’s syndicate leaders attended Apalachin; it was a conference called by the seaboard syndicates. But Detroit is closely linked to Brooklyn in usury and drugs, and just before the conference Big John Ormento, a Genovese lieutenant, had talked on the telephone to a leader of the syndicate in Detroit. Detroit in 1956 was importing its heroin through Windsor. One of Detroit’s syndicate directors, a young man with widespread business interests, no criminal record, and an inherited fortune made in the rackets, owned a leading Windsor bakery which trucks bread to Detroit. The bakery was managed by Nicholas Cicchini, a major drug trafficker. That year a Cicchini courier, Giuseppe Indelicato, was arrested returning from Italy with three pounds, nine ounces of heroin. Detroit needed a new supply route and the seaboard group needed more supplies.

EXPLOITING INNOCENT IMMIGRANTS

The syndicate leaders had worked out an answer. Bonanno had come to Apalachin fresh from a meeting in Naples with Lucky Luciano, chief-of-operations in Europe. Santos Trafficanti, Mafia controller in Cuba and Florida, had met in Cuba with Paul Mondolini, liaison for the Marseilles ring that supplies the processed heroin. The Marseilles ring would ship the drugs to a Mafia ring in Sicily, which had a representative at the conference. The Sicilians would transship the drugs to North America in false-bottomed trunks unknowingly carried by innocent immigrants, highly unlikely suspects. Arrangements for the shipments would be made in North America by a representative of the Sicilian ring then living in Toronto, a bakery owner, Alberto Agueci; in Sicily by a travel agent, Salvatore Valenti. The trunks would at times come into the U. S., more often into Ontario. This called for co-

operation from the Niagara FallsBuffalo syndicate controlled by Stefano “The Undertaker” Magaddino, owner of a funeral chapel in Niagara Falls, N.Y. His syndicate has for years supplied drugs to Hamilton and Guelph, who in turn will often supply Toronto and Vancouver. Buffalo, accordingly, was represented at the conference by Magaddino’s brother, Antonio, and his drug supervisor, Dominic D’Agostino. The drugs coming into Ontario would reach New York through their territory, except for those diverted to Detroit through Cicchini.

This plan involved seven drug rings in four countries. Five were represented at Apalachin. Their traffickers arrived early and thrashed out the details. The top brass — Vito Genovese, Joe Profaci and Gerardo Catena — came in before noon on the second day to make the final décisions that for a time made Toronto one of the continent’s main ports of entry for heroin. ■

TAKING OVER'TORONTO

The man most responsible for carrying out this plan was Vincent Mauro, a heavy-set bachelor with deep-circled eyes. He grew out of a back-street gang in Greenwich Village in New York, a brawler, thief, armed robber and killer. The Greenwich Village syndicate recruited him as a drug peddler and he rose as the syndicate grew, a sprawling illegal corporation controling drugs, gambling, juke boxes, labor extortion and loan sharking on the Jersey piers and lower westside New York. Genovese, as board chairman, was over it more than in it. Anthony Strollo, called Tony Bender, then fifty-seven, was its managing director. Mauro, sixteen years younger, was in effect vicepresident in charge of drugs.

Mauro was not the typical Mafia leader, deferential, soft-spoken and devious. He was a race-track and night-club habitué, crude, loud and direct. He liked showgirls, two a night, and he envied Carmine Galente, Bonanno’s chief lieutenant, who had gained prestige when he took over Montreal. Shortly after Mauro began supervising the drug route through Ontario he decided he would take over Toronto. He used a Toronto Mafia enforcer, “Johnny Pops” Papalia.

Papalia grew up, one of six brothers and half brothers, on Railway Avenue in Hamilton. He quit school in the eighth grade, a skinny but vicious gang leader, bootlegged a bit for the syndicate, did a little breaking and entering, fought off a bout of TB and dodged the draft. He was peddling drugs in Toronto in 1949 for Harvey Chernick when police caught him with heroin capsules near Union Station. With tears streaming down his face

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he talked himself out of he penitentiary by claiming that he wouldn't survive his sentence. Two years less a day in reformatory completed his apprenticeship. Sometime after release he headed for Montreal. Here Carmine Galente was organizing gambling, drugs and protection. Johnny Pops joined his strong-arm squad under Louis Greco.

He worked with several other Toronto hoodlums: John Sutherland,

who had also worked for Chernick in drugs; a phony stock salesman, Barney Altwcrger; Frank Battaglia, soon to be murdered; and an ex-boxer, Norman Yakubovitch, better known as Baby Yack. One of their chores was beating up shady brokers who welched on protection. These sharepushers often peddled their stock simultaneously from Toronto, and to deal with them there Louis Greco would dispatch his Toronto contingent. They were often seen in Toronto from 1953 on: police saw nothing unusual in their presence.

Papaba in 1955 was a bachelor of thirty-one. His taste in clothes and girls was costly and he had the hoodlum habit of always carrying a thousand dollars. He was not a big man. about five-foot-eight and slight, with a scarred right cheek, hooknosed and black-haired, soft-spoken and wellmannered — except when slugging someone with a blackjack. He was sharp-witted and self-controlled. The syndicate found him reliable.

Johnny Pops, like Mauro, was ambitious. In 1955 we find him demanding a cut from the owners of Toronto's most lucrative illegal enterprise, the gambling casino at nearby Cooksville.

This casino was the creation of two bookmakers in Toronto: Joseph McDermott and Vincent “Pete" Feeley. They and a convicted bookmaker named James Ryan were known as The Three Thieves, which describes the early careers of the two main partners. Joe McDermott was the leader, an exuberant crafty man who, when charged with breaking and entering in 1940, joined the army in order to come before the magistrate in uniform, a dodge that won a suspended sentence. McDermott respected knowledge. He liked to read, about law in particular, especially the laws on betting and gaming. He had learned to shoot crap as a caddy and, as a small-time west-end bookie, he had dreamed of his own gaming club.

Three things are required for a gaming club: clients, capital and “the edge." The edge is an agreement with police to let the club operate in return for a share of the take. Even one policeman, strategically placed, can provide the edge. He can tip the club on forthcoming raids and the raiders will find no evidence.

Around the end of the Forties, according to the Roach report, The

Three Thieves had acquired an edge: Sergeant John F. Cronin, second-incommand of the anti-gambling squad of the Ontario Provincial Police. This asset enabled McDermott and Feeley to interest a number of bookies in a gaming casino at Cooksville outside j Toronto. Two gaming house operators from an uptown Toronto club, Johnny Riggs and Ernest Midgley, bought in and brought their clientele. They operated, as usual, in the guise of a social club on a federal charter, Alpha Club Limited.

The club prospered. It gave McDermott and Feeley the capital needed to get into bookmaking in a big way. One by one they bought out small west-side bookies, keeping them as “front ends,” customer’s men who phoned bets to a “back end,” who worked for McDermott and Feeley. They passed an “anonymous” tip on at least one occasion to Sergeant Cronin, whose men found betting slips beneath the counter in a store — and another competitor was eliminated. They squeezed out Clarence “Tiny” Lake, and when he complained, had him roughed up. McDermott, the hail-felIow-well-mct, had another side to his nature. He kept a baseball bat behind a door at his Cooksville club and when a gambler, Moc Davidson, was caught cheating at table, McDermott had the pleasure of breaking Davidson’s arm.

Their influence grew with their income. They made the acquaintance of members of parliament. They became the bosom pals of a cabinet minister. They lost the services of Sergeant Cronin, who retired in 1954 to become co-owner of a $150,000 Kingston motel, but their edge with the OPP anti-gambling squad was augmented by Constable Robert Wright and, the Roach report clearly indicates, Inspector Allan Stringer, friend of Commissioner E. V. McNeill. This made them attractive partners in any Ontario gambling venture, and when Frank “Curly” Gardner, who ran Windsor’s Oldcastle Country Club, went broke in 1954, he brought in McDermott and Feeley and Vito “Billy” Giacalone, supervisor of gambling for the Licavoli syndicate, an amalgamation of very rich elderly businessmen in Detroit, whose sons and nephews are now taking over.

This was the situation in 1955 when Johnny Pops tried to take over. McDermott and Feeley were partners, in one case with Detroit Mafia, in the two biggest casinos in Ontario, and they had the major book in west-end Toronto. In the east end, David Greenberg, alias Gilbert, was big. And biggest of all, with two hundred runners in downtown Toronto, was a dark - haired, blue - eyed, hard - faced man, Max Bluestein, alias Baker, bold and clever, once an important figure in Toronto’s biggest crime ring, then a silent partner in Feeley and McDermott's Cooksville casino.

JOHNNY POPS was muscling in on the two biggest gambling groups in the province. Bluestein, it is said, wanted to have him beaten up. McDermott demurred, and on this issue Bluestein quit the club. McDermott now asked his Detroit partners to rid him of Papalia. Two “heavies” came up and

found out wno jumm, * enforcer in Toronto for the MontrealBrooklyn syndicate (by way of the Montreal operation) and the son of Anthony Papalia in Hamilton, associate of Tony Sylvestro, long-time drug connection with the Magaddino syndicate in Buffalo. It was an impasse. The only way out was in union.

Johnny Pops became the enforcer for the McDermott-Feeley group, with a slice of the profits from Cooksville, Windsor, and in 1958, from the New Ramsay Club in Niagara Falls, backed by McDermott and Feeley and run by Benny Nicoletti, head of gambling for the Niagara Falls-Buffalo syndicate.

In the decision of Vinnic Mauro of the New York Mafia to take over

Toronto’s rackets, Johnny Papalia was an important element. He was well known in Buffalo as a friend of Freddy Randaccio, the somewhat psychotic enforcer for the Magaddino syndicate. He was a good friend of Mauro; both were bachelors: they went nightclubbing often together in New York. And Papalia already had the nucleus of a criminal organization, a strong-arm squad.

Papalia, in fact, had already begun to consolidate. His cut from Cooksville had given him affluence. His next move was back in his home town of Hamilton. Dan Gasbarrini, caught in Vancouver wholesaling drugs for Tony Sylvestro, had got out of jail in 1955, a short, pleasant, well-groomed, young (thirty-four), behind-the-scenes operator, the intimate and successor of Sylvestro; Sylvestro had married Gasbarrini’s sister and he had married Sylvestro’s daughter. At about that time the provincial secretary’s department was advised that the Porcupine Social Club was being revived. This was a club in Timmins, a town where Sylvestro had high-grading contacts. Late in 1956 a branch of the club opened in Hamilton. Its overseer was Dan Gasbarrini. He built — and shared with Sylvestro — a large new home in Burlington, worth well over fifty thousand dollars.

Gasbarrini's partner in this club was Johnny Papalia, and behind them again were several Hamilton businessmen and three Mafia dons, leaders of the active Hamilton underworld. They were in their mid-sixties then, oldfashioned and insular despite their U. S. connections. They still spoke with their old-country accents. They

still viore the broadbrimmed hats ot the prohibition era when they were tough young alcohol runners and makers. They were still tough, though now' in a different way; two men w'ho tried to cut into Hamilton’s drug market in the Fifties, cab driver Anthony Codispodi and cardsharp Anthony “Tom DP” Kuternoga, were found on the city’s outskirts shot through the head, both by .32 bullets. One of .the three dons is in real estate; another owns race horses. A third was Tony Sylve^tro, who died last month. These, with Matteo “Big Joe” Cipolla and his sons in Guelph, and Nicholas Cicchini in Windsor, were the hard core of the Mafia in Ontario. In any bid for power by the Mafia in New York Johnny Pops could count on their support.

IN JANUARY 1958. the year the takeover started, Max Bluestein applied to Toronto police for a gun permit. He had been asked to a meeting, he said, in Toronto’s Westbury Hotel. Attending >vere Mafiosi from Hamilton, New York, Detroit and Buffalo. He had refused to fall in with their plans for Toronto, he said, and he might need some protection. The city police, of course, turned down his request.

The Mafia’s expansion into Toronto began with a shift of personnel. Frank Marchildon, the Hamilton ring’s supervisor, a hard young French-1 ndian hoodlum from Penetang, was transferred to Toronto where, as a front, he bought a hairstyling salon at Yonge and Bloor Streets (sold last year). Hilton Harmes, small but expert with tirechain and bat, replaced him as supervisor in Hamilton. Joe Hasler, widely feared as a gunman, moved up to Harmes’ slot as enforcer.

Around the area large jewel robberies began. In May 1958, diamond merchant Rafael Adler was ambushed in his eleventh floor room in the King Edward Hotel, pistol-whipped, taped up and robbed of thirty-six thousand dollars in diamonds. Some were found in the Empire Jewelers in Hamilton, owned by Theodor Szmaus. Szmaus forfeited twenty thousand dollars bail and flew to Brazil. He wrote that he had left to avoid being killed by a Mr. X. According to underworld gossip, which may or may not be true, the robberies were planned and organized by Harmes and a Hamilton lawyer using Hamilton jewelry store owners as fences. Szmaus had been angry at taking the rap. He threatened the ring with exposure, and when a killer from Brooklyn came up to still his tongue, he fled.

In Toronto Papalia worked with Alberto Agueci, liaison man in America for the Mafia drug ring in Sicily. In 1950 Agueci, then twenty-seven, had tried to get into the U. S., was turned down and emigrated to Canada. He came with a letter of introduction to a travel agent in Windsor from an international trafficker in drugs, Rosario Mancino. Soon afterward Agueci was able to leave his road-laborer’s job for part-ownership of a Toronto bakery.

Johnny Pops and Agueci allied themselves with a large loose-knit group in Toronto headed by a local

car-wash operator who had served in army intelligence in World War 11 and become a postwar gold smuggler: he is still wanted by police in Detroit. They recruited two strong-arm men and gaming club operators, Fred “Gabe” Gabourie, a former Hollywood stunt man, and Jack Weaver, both in their thirties and both marijuana smokers. It was now all one group; the formerly slow-moving Mafia-led ring in Hamilton was nowjoined to a fast-moving, Mafia-backed

group in Toronto: the evidence is clear and indisputable. A raid on a club in Hamilton in July 1958 disclosed a big sports-betting operation with a CNR ticker tape bringing news of events across the continent. It was run by a popular dice artist, Donald “Red” LcBarre, with the help of Joe and Dominic Papalia. and Tony Pilgüese, sons and son-in-law ol Anthony Papalia, Johnny Pop’s father. The club purported to be a “branch” ot a club in Toronto; its “charter" was a photo-

stat of the charter in Toronto for the West End Bridge and Social Club run by Weaver and Gabourie.

The police closed the Hamilton West End Club and the Divion Club took its place. It employed two more of Anthony’s sons, Angelo and Rocco Papalia. A raid disclosed that it. too, was a branch — of the Divion in Toronto — operating by “permission” of the president, Jack Weaver.

With the closing of the Divion in May 1960. the Checker Club opened.

run by Red LeBarre and Rocco Papaba. Always, behind the shifting locations, “officers” and charters, the controllers remained the same, the newly-formed syndicate: Johnny Papaba in Toronto, backed by the carwash owner and Agucci; and Dan Gasbarrini in Hamilton, backed by the three dons.

In 1958, in Toronto and Hamilton both, loan sharks (“shylocks”) appeared in the gambling clubs, encouraging gamblers who lost to borrow

money. A badly hit bookie could get ten thousand dollars with no questions asked. Businessmen strapped for quick cash had only to ask. The shylocks or “juice dealers” often do not even put up any money. They borrow it from the businessmen who habituate their clubs, paying them double or triple the usual interest under the counter which, of course, gives the businessmen income free of tax. The shylocks charge ten percent a week, 520 percent a year. Slow pay brings a

“reminder," a beating with lead pipes and baseball bats. Welching — most infrequent — could bring death. This racket is also called the six-for-five; five dollars loaned for two weeks brings in six.

With the forming of the juice ring, credit eased at the gambling clubs. Gamblers could now sell their NSF cheques to the ring who always collect. Two collectors one day confronted a pimp, in hock for a thousand dollars, in a Bay Street lounge in

Toronto. He was forced to sign over his five thousand dollar convertible, which was then sold for three thousand to Jack Weaver. Last winter, when a Winnipeg hotel owner lost thirty-six thousand dollars to a bookmaker in Toronto, two strong-arm men went to Winnipeg to see him. He had to give them two hundred and sixty cheques, postdated a week apart, for three hundred dollars each, a total of seventy-eight thousand dollars.

The strong-arm squad was also used to extend stock market extortion. A Bay Street broker approached a year or so later recounts the technique: Papalia walked into his office and talked his way past the receptionist. In the inner sanctum he gave the broker his name. "Does that mean anything to you?” he asked, clearly expecting it to inspire fear. When the broker said no, Papaba said, "Well, it's going to. I'm your new partner.”

The broker said he was crazy.

“Don't you know who 1 represent?

. . . I represent people from the other side.”

The broker was growing angry. “Now look,” Papaba said. “1 don't want any trouble with you.”

"What do you want?” asked the broker.

"A thousand dollars a week — for protection."’

“What kind of protection?”

Papaba smiled. “Protection against everything.”

The broker told him to leave or he'd call the police.

"Call the police eh?” Papaba said. “We'll have to learn you the ABC's. We'll have to give you a few lessons." He left. A few minutes later two of his men walked into the office. One was swinging a blackjack. They paid no attention to the customers. They pushed past the four secretaries and beat the broker into unconsciousness. At least two other stock promoters are known to have been beaten and at least two more have been threatened: the brokers say many arc paying oil.

In Hamilton in that same expansion year, 1958, Arthur Tartaglia and an associate set up the Monarch Vending Machine Company. Tartaglia was a highly successful salesman. He would walk into a restaurant and ask for the manager. “Your cigarette machine's in pretty bad shape,” he would say. “How would you like a modern machine?” If the manager said no he might be offered a hundred dollars to put in a Monarch machine. If he still refused Tartaglia would try to intimidate him. A restaurateur who slighted the Monarch machines and their owners was beaten so badly he had to go into hospital. “His head was bandaged for weeks,” a detective in Hamilton recalls, “a w-alking advertisement of the advantage of doing business with the Papabas” — for Tartaglia, to strengthen his business, had taken the Papabas in as partners.

The same pattern appeared in Toronto. Papaba and Agucci. and their young Czech business manager, Ernest Koutnik, set up the Star Vending Machine Company. Police were powerless to stop them because terrorized shop owners would not co-operate.

And now the cigarette thefts began. “At first it was mostly break-ins,'’ says a provincial police inspector.

They'd hit the warehouses. Then they

started hitting the railways. Now it’s the transports. It's spread across the province and into the States and Quebec. We believe it's the same Toronto gang; their MO (method) is the same."

There are three organized rings. One stole forty thousand cartons in eight months in 1962-63. In one month this group ran up a gasoline bill of five hundred dolíais following cigarette trucks, charting their routes and stops. "It's the same thing with railway cars,” a detective says. "They get the number. They know where it stops. They don’t hit till they’re sure it's safe, about once every month or six weeks. Then they back up a oneand-a-half-ton truck and lead up about ninety cases, w'orth eight' to a hundred and twenty dollars a case on the black market.” Detectives in three police forces are convinced that the stolen cigarettes find their way into the small fraction of vending machines that the underworld control.

The underworld infiltration of bingo, though plotted in Detroit, was welded to the growing Toronto syndicate structure. Bingo is a game of chance generating, in its big halls, the atmosphere of a gaming casino. The suspense and the glittering prizes — a new car or several thousand dollars in cash — draws three thousand players on only a fair night; Since each player spends four to five dollars bingo is big business for its operators — illegal except when all profits are given to charity.

In 1957 a small Toronto company, Esquire Novelty, began selling bingo cards to churches and service clubs. In Sudbury, where the Lions Club was paying two fifty a thous; nd for bingo cards. Esquire's salesman sold cards for a dollar a thousand, just before every game thereafter a man named George Foxley w'ould fly in, sign into a Sudbury hotel as John Burke, and arrange for three or four local people to go to the bingo game with a printing press concealed ini a ladies' purse. As the numbers were called they would print them oh identical blank cards. Afterward Foxley met them, paid them twenty to‘.a hundred dollars, and left with the prizes. Out of fourteen thousand dollars given in prizes at Kirkland Lake bingos, the ring bagged $13,500.

Esquire also organized games for the churches and service clubs, and ran them on a fifty-fifty split after expenses. But expenses were always high and profits low. In four years the Lions Club in Trenton made thirty thousand dollars. Esquire made a hundred thousand, and, since its caller was rigging the game, another ninetysix thousand dollars in prizes. In Toronto alone this illegal alliance of charity and crime took in about six million dollars a year.

Esquire — since sold to reputable businessmen — w'as owned by two racketeers from Detroit and Ohio. Fred "Bud” Bailey was front man and salesman. Calvin Silber, whose record includes manslaughter, managed the office and the operatives. They organized Ontario in districts. The eastern circuit — Ottawa. Cornwall. Brockville. Kingston, Belleville and

Peterborough — was handled first by Foxley. a con man from Detroit, w ho then set up and ran the northern circuit — Sudbury. Sault Ste. Marie. Kirkland Lake, Timmins and North Bay. St. Catharines. London and Chatham was the area of Virgil dendennen. a Cleveland hoodlum. One of his callers, a Windsor man. informed the police and RCMP seized Clendennen’s bingo equipment as it was crossing the border. Two days later the informer was found lying unconscious in an alley, his face smashed almost beyond recognition.

Later investigations — first by Sudbury police, then by Ontario Provincial Police and city police in Toronto — culminated in a seizure of company records. They revealed a remarkable operation never yet disclosed. The ring made use of Kinsmen in Moncton, Halifax, and St. John's. It drew money

from Corner Brook. Nfld.. Fredericton. N.B.. Sydney. N.S.. Edmonton. Alta., and from newspaper bingos in Winnipeg and Vancouver. Esquire was hoodwinking hundreds of churches and service clubs in eight provinces — 1 say hoodwinking, for if these groups had known who they were fronting for, I am sure the partnership would have ended abruptly.

Investigation showed, too, that Bailey and Silber were sending money to Detroit. "Someone was behind them.” a Toronto detective says. "They weren't big-time. Someone was financing them.” It is a reasonable supposition — though no more than that — that this someone was the syndicate in Detroit. There is no supposition about their Toronto associates. Bailey and Silber were sharing the profits with Papaba. Marchildon and Agueci, whose employees, Ernest

Koutnik and John Sutherland, among others, operating as Merton Hall Ltd., ran bingo games in the KitchenerWaterloo-Gail area.

■ ■ ■

FROM THE I.ATE FIFTIES the Toronto and Montreal syndicates were co-operating. Toronto was organizing robberies and marketing stolen bonds from robberies organized by the Montreal syndicate; some turned up in Toronto with Laughlin Miles MacPherson, an Imperial Bank of Commerce manager, and Martin Resnick, a salesman for Sealtite Aluminum, a firm in which the Toronto car-wash owner had an interest. Through two Agueci henchmen, Dominic Procopio and Rocco Zito, the Toronto Mafia sold alcohol bought from Montreal Mafia middlemen to the Italian community in Toronto. A Montreal syndicate member, Maurice Cloutier, was running drugs to Toronto, using beautiful women as couriers. One, Fern DcCarle, had once been the secretary of Walton Rose, McDermott's lawyer.

The expansion was well under way by January 1959, when Sam Monachino, co-owner of the Super Beverage Company in Auburn, N.Y., and a delegate to the Apalachin conference of Mafia leaders, moved to Hamilton. In June I960, Onofrio Minaudo, a deported Detroit racketeer and close associate of syndicate drug traffickers, then living in Cuba, moved to Windsor. Were these moves to strengthen the new Ontario syndicate? By 1961 it was certainly strong. It controlled extortion and usury in Hamilton and Toronto and the wholesale trade in drugs in Ontario. It was getting its cut from the nation-wide bingo ring organized by Detroit and the gambling network run by McDermott’s group. It was time to eliminate competition, to cut in on everything big, and the toughest competition, as well as the biggest prize, was the gambling combine headed by Max Bluestein.

■ ■ ■

IN .JUNE 1960 an undercover invest gation by the Ontario Provincit Police closed the Cooksville casinc Floating crap games — games held ii different Toronto hotels every nigh — became lucrative. Bluestein hac four of the biggest, and the syndicate had several, run by Gabourie, Weaver and Les Irwin, an ex-heavyweight boxer, now a strongarm man.

Late in 1960 Toronto police made two arrests. They knocked off the Lakevicw Athletic Club run by Bluestein, and one of the crap games run by the syndicate. Papalia suspected Bluestein of tipping police about his game, and possibly Bluestein knew he was suspected. He chose four months in jail in lieu of a fifteenthousand-dollar fine, though the magistrate figured the gross profit on bets in the Lakeview Athletic Club was more than a million dollars a year. This is probably high — and Bluestein had partners — but his income was certainly large.

With Bluestein in jail Papalia approached the man in charge of his games, a gambler known as Roughneck Chiavarini. Papalia demanded a cut on terms that amounted to a take-

over, Chiavarini hurried to see Bluestein, who promptly bought his way out of jail (a clerical error reduced his fine to four thousand dollars) and began negotiations with the syndicate. He played it tough and arrogant (“Who the hell are you?” “Why should / talk to you?”) but under the hard façade he was uneasy. As he later said, “It’s not as if you’re dealing with one guy.” He agreed to a meeting on March 21 at the Town Tavern.

The Town in downtown Toronto is a popular lounge and restaurant. It had almost a hundred customers that night, many of them hoodlums who were there by invitation. Papalia had spread the word. He wanted Toronto’s gamblers to know that Bluestein had capitulated, or — if he still held out — to see the consequences.

Bluestein came in after dining a few blocks away, sat as usual on the res' taurant side, and held court surrounded by friends. Gabourie and Weaver joined him. From another table Papalia, sitting with Marchildon and Irwin, sent a waiter over to Bluestein with a drink.

This was the time of decision. If Bluestein accepted the drink — “the hand of friendship” — he was accepting the syndicate as his partner. He had come prepared, at least, to talk, but there was the matter of prestige. In the rackets, as elsewhere, prestige increases with wealth and Bluestein, though he denies it, is more than a millionaire. He has interests in at least two hotels, a finance company, and perhaps as many as twenty apartment buildings. He had been a rackets’ boss when Johnny Pops had been working the street for Bluestein’s close associate Harvey Chernick. Bluestein waved the drink away. “If some punk wants to talk to me,” he rasped, “let him come to my table.”

He had made his choice. Bluestein has nerve. As time passed his confidence grew. He told his friends to leave. “Go ahead. I can handle these punks,” he assured them.

The lounge closed. One o’clock neared. Bluestein rose and strolled om the restaurant. At the hat-check »unter Papalia and Weaver engaged m in conversation. They asked him step in the lounge, now dark and serted. Bluestein declined. As they ked Gabourie, Marchildon and Irn were leaving their restaurant de and stealing through the lounge .o come up behind Bluestein.

Bluestein pulled a thin-bladcd fish knife. A blackjack thudded against his head. Falling, he clutched at his nearest assailant — Marchildon — stabbing him eight times in the back. Iron bars swung on short ropes were smashing his cheekbones and his forehead. Brass knuckles gouged his face and eyes. A broken bottle was thrust into his mouth. As he lay on the floor in a spreading pool of blood someone kicked his face.

Outside, customers trying to enter were intercepted by hoodlums. When police arrived they found no one who would tell them what had happened. Though the beating had taken place in plain sight, the Town’s customers, staff and management, as Pierre Berton later reported in a Toronto Star column, had been stricken by “perhaps the most remarkable case of continued overleaf

mass blindness in scientific history.” Bcrton’s column created pressure. A special police squad was put on the case, and on April 21 warrants were sworn out for Papalia, Marchildon, Weaver and Gabourie. Johnny Pops had overreached. More people had learned his lesson than he intended.

BY 1960 At.BERIO AGUECI, though Still something of an outsider, may well have been reaching the status of don. When Papalia vanished following the beating of Blucstcin, it was Agueci who ordered him to surrender, thus taking some of the heat off the syndicate. When Agueci’s daughter FrancaMaria was baptized that September, Buffalo enforcer Freddy Randaccio and his wife traveled to Toronto ’o pay their respects. Agueci had managed thus far to stay in the background; to Toronto police he was only a name passed on by the U. S. Bureau of Narcotics.

But that same September the ring in Sicily slipped. It shipped a trunk containing heroin to the wrong New York address. Papalia flew to New York to discuss it with the syndicate drug supervisor, Vincent Mauro. On the way back he stopped off at Buffalo. Stefano Magaddino had had a heart attack; Freddy Randaccio was in charge. Randaccio told Papalia to send Agueci’s brother Vito to Sicily to warn them against further slip-ups.

It was too late. New York narcotics bureau agents arrested two Sicilians as they claimed a trunk carrying ten kilos of heroin, a loss to the syndicate of some seventy thousand dollars. The resulting enquiry uncovered the link with Toronto. In Toronto the investigators turned up a telegram trying to trace the mixed-up trunk. Toronto police chief James Mackey put twelve men on the case. They learned that numerous Italian-Canadians had made return trips to their homeland at Alberto Agueci’s expense. The Italian police, the French Sûreté and the RCMP joined in. Bureau undercover

agents burrowed into Agueci’s ring and Niche las Cicchini’s ring in Windsor. In May and June, 1961, forty-five traffickers were arrested, including a Mafia ring leader, Giuseppe Palmeri in Sicily: Vincent Mauro in New York with his two lieutenants, Frank Caruso and Salvatore Maneri: and, in Toronto, Alberto and Vito Agueci, and, a little later, Johnny Papalia. It was "the deepest penetration . . . ever made in the illegal international traffic of drugs,” reported U. S. AttorneyGeneral Robert Kennedy to his brother, the president of the United States.

The immensely wealthy and powerful head of the syndicate in New York, Vito Genovese, was in prison in Atlanta, but he was still issuing orders from his cell. It is thought that he ordered his men some time before to get out of narcotics, and that he did not know the Toronto ring was in operation. He would, of course, blame his syndicate director, his boyhood friend and groomsman, Tony Bender. Lending substance to rumor, Bender now disappeared. He drove off with several men from his home at Fort Lee, New Jersey, and neither he nor his car has since been seen. Police suspect that they have gone into one of the wrecking machines in New York that press car-bodies into four-foot metal squares, which are then trucked to a blast furnace for remelting. It is one of the syndicate's latest methods of corpse disposal.

Mauro took over Bender's domain: west-side New York and the New Jersey water front. Pending trial in September 1961, he had been released on bail of two hundred and fifty thousand dollars. Here we can glimpse hoiv closely New York was now mdshed with Ontario. First, Mauro had his bail reduced to fifty thousand dollars. Then he telephoned a Hamilton lawyer who is deeply involved with the Mafia both in Ontario and Buffalo. The lawyer called a Toronto travel agent. He gave the agent names and particulars of three Hamilton citizens and the agent got him three

Canadian passports. The lawyer sent them to Mauro who. with Caruso and Maneri, jumped bail. They flew to Nassau, Jamaica, then Spain, partying like potentates, spending about a thousand dollars a day. In Barcelona they were met by a courier from Lucky Luciano, who is thought to have given them a fresh supply of funds. Meanwhile, the U. S. narcotics bureau had released pictures of the trio, and a lady from Nassau informed the bureau that they were traveling as Canadians. In Italy the police had Luciano's men under surveillance. When the courier landed in Spain he was followed by Spanish police who reported that he had met three Canadians. In New York the district head of the narcotics bureau, George Gaffney, put these separate pieces of information together. When arrested the racketeers had fifty thousand dollars in a safety deposit box in a Spanish bank. Caruso was traveling on a passport made out in the name of a Hamilton cigar-store owner; Mauro under the name of the owner of a Hamilton novelty shop; Maneri under the name of a Hamilton steelworker. All three gangsters had drivers' licences from a robbery the previous March of the Motor Vehicles Branch at Shclbourne, Ont.

Agueci. too, had made bail but not without difficulty. He had had to sell his house and car. He was angry at Stefano Magaddino, who, in return for his cut of the profits, was supposed to provide what is usually called a "defense and lamming fund” — bail or fines, legal help, hideouts, false identities, escape funds, and, of course, family benefits while absent. Agueci felt that Magaddino had welched. He swore that unless Magaddino lived up to his bargain he would talk, and early in August he journeyed to Buffalo to lay it on the line.

His body was found in the underbrush of a country lane near Rochester. He had been tortured. His mouth was broken. Eight teeth had been kicked or knocked out. Three ribs were split. His ankles and wrists had been bound with nylon cord and he had been strangled. Identifying labels, his zipper, even his fingertips, had been cut off, and his body soaked with gasoline and burned. The torture might have continued for days; his body had lost fifty pounds.

■ ■ ■

ALL DURING this period of the syndicate's greatest expansion — 1958 to 1961 — the then attorney-general of Ontario, Kelso Roberts, was reiterating in public that Ontario had no organized crime. In fact, he assured his fellow MPPs on Feb. 23, 1959, that gambling conditions had improved.

Five months later, Toronto’s chief constable, James Mackey, wrote a warning to Elliott Pepper of the attorney-general’s office that large U. S. criminal organizations had moved into Toronto to take over chartered clubs for gambling. He wrote again in September, this time to W. C. Bowman, director of public prosecutions in the attorney-general’s office, referring to his previous report to Pepper. On Oct. 16 Bowman forwarded Mackey’s report to the deputy minister of the department of the provincial secretary, which has the power to cancel or issue

club charters. No action was taken until the end of December, when the press criticized the department for not canceling the charters of some twentyfive clubs that were being used for gambling. Finally, in January 1960, the deputy minister met with Mackey to discuss the situation that Mackey had warned about six months before.

Over the next two months thirtytwo clubs lost their charters, almost twice as many as in the previous decade, though this reflects more credit

on the police than on the government, which canceled the charters only after convictions by the courts. Indeed, even after the outcry raised by Bluestein's beating and Agueci's exposure, the government resisted demands for an inquiry. It took a pointed warning by RCMP Commissioner C. W. Harvison. speaking to the Canadian Club in Toronto, and a crackling report in the Ontario house by opposition leader John Wintermeyer, to force the government to set up a royal com-

mission. We now have its report. Like Mr. Roberts, it says no syndicated crime exists in Ontario.

■ ■ ■

WE ALL POSSESS to some degree, I believe, a sense of story, a feeling for form, beginning and end. finiteness. We are used to applying this to crime where the story normally ends with the death or arrest of the criminal.

con tin lied over lea f

In April of this year Johnny Papalia was sentenced to ten years in prison. Alberto Agueci and Tony Bender are dead. Mauro, Caruso, Maneri, Vito Genovese, Big John Ormento, Nicholas Cicchini, McDermott and Feeley, are in jail. Charlie C'ipolla of Guelph was arrested last month on drug charges. Bailey and Silber, still wanted here for their nation-wide bingo frauds, are at large in the IJ. S. The Ontario Provincial Police — a hardworking force which six

men besmirched — have closed the Niagara Falls and Cooksvillc casinos. And Toronto police have closed all but two gambling clubs in that city.

Here arc the elements of an ending, and even we who should know better — the journalist, the policeman, the magistrate — are predisposed to believe that the curtain has fallen on the drama of a U. S. syndicate takeover that failed.

Fiarly in 1962 a company named

GSB Amusements tried and failed to set up a gaming casino in the Arawak Hotel built by Toronto hotelmen on the north shore of Jamaica. Gambling is illegal in Jamaica, but through political pull, CiSB hoped to get authorities to first tolerate, then legalize it.

GSB was set up hy a Toronto accountant, George Gold, along with Bud Bailey and Calvin Silber, backed by gamblers in New York, New Jersey, Las Vegas and Toronto. In June, 1962, the accountant, Gold, was ar-

rested. He was now running a book, doing ten thousand dollars in business a day, for Max Bluestein. That same month, David Stillman, a partner in Bluestein's Lakeview Club, was a found-in at a raid in business hours of the Somerset Club. Dave Gilbert, the big east-end bookie, then belonged to the Somerset Club. Ernest Midgley and Jack Riggs of McDermott and Fecley’s group were members. In short, after the Bluestein beating, Toronto’s three biggest combines, as well as one of the biggest independents. Benjamin Leitman, arc all congregated together in the Somerset, a club run by Harry Eisen, who ran the Columbia, West End and Divion clubs for the syndicate.

Gambling has clearly become a cooperative enterprise, and the instrument of co-operation, the strong-arm squad, is still maintained by the syndicate. It still controls alcohol, loansharking, distribution of stolen securities, vending machine enterprise (now run by another Papaba) and narcotics, which they recently tried to revive. Business, it’s true, has fallen off, with a royal commission just ended, but we can be sure the syndicate is planning for the future when public concern will fade and police pressure slacken.

Though the stars of the drama have passed offstage, the supporting cast remains. In Toronto: Frank Marchildon, Fred Gabourie, Jack Weaver, Leslie Irwin, and a hundred I have not named. In Hamilton: Dan Gasbarrini, and the canny, close-mouthed dons, with contacts in almost every city of any size in Ontario, and linked by race, tradition, and mutual profit to Guelph and Windsor, and syndicate leaders in New York, Buffalo, Detroit and Montreal.

The story of the crime cartel will not fit our preconceptions. It is an institution, no more finite than our own vice. Death or arrest of its members docs not end it. As one of its victims says, “There’s always another and another and another.” ★

In an early issue: how the crime cartel sells its products across Canada.