Topics:

• Pinball
• Horse racing
• Policy (number) wheels
• John Doe investigations

Links:

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Bonus fact: In 1963, the Wisconsin supreme court ruled free plays on pinball machines were illegal - even though there was little enforcement behind the law. In 1980, Wisconsin legalized free plays.

Hey everyone. Welcome back to another episode of the Milwaukee Mafia. I am Eric Wulterkens. I am Gavin Schmitt. And we got some exciting news – The Patreon is officially live. You can go right now and sign up for it and I mean right now. You can find it at Patrion.com/milwaukeemafia or you can also go to millwaukeemafia.com and look on the right hand side and there will be a link that takes you directly to the Patrion to join. We do have one episode posted so and we will bringing out more every other week as this goes on. So we appreciate anybody’s support.

Alright, yes so yes sign up for the Patreon. It is just two dollars a month or one dollar per episode. Not these, these will remain free but you will get your bonus content which is our mailbag feature and I hoping to get some interviews on there as well. That’s where I would throw Interviews if we get those.

So, stop for just one second and clarify - Right up to the pistol, explain. Right up, the pistol goes off and the horses start running. So now things are being sent over the wire like a telegraph. So it is instant results. So again it is 30s and 40s. We do not have tv yet. Radio isn’t nationwide so you don’t get those instant results if you are not there.

The YMCA said, we must stop pinball. They knew about a boy who had stole $30 because he was so addicted to pinball he had to steal money to keep playing. It’s good to know that people were just as crazy back then as they are now.

Well, so here we go. The city council was not crazy about that item. They now said you can try to ban these machines but how about this – we have a better idea. How about we license these machines and then we just take some money for the city. They said we estimate that pinball in the average year takes in two million dollars. I have no idea where they are getting that number from. But they are like “Why don’t we get a cut of that money” This was argued by the district attorney, as well as the attorney for the pinball board of trade. The attorney for the pinball said that 12,000 people depended on those machines for their livelihood. Where do they get that number? Don’t know. Don’t know. Okay. But you don’t want to put 12,000 people out of a job. And he said even if you did ban them you wouldn’t stop gambling. Quote. Yeah you can gamble with the devices but you can also gamble with playing cards. You can gamble with license plates, you can gamble whether or not the King is going to marry Mrs. Simpson. If you want to end gambling you have to abolish the King as well as pinball. Common council agreed with that and they decided to license the machines.

Kuchesky he says this is not good enough for me. So instead he is going to start shutting places down. He says I can’t get rid of pinball, I am going to go after places that are becoming nuisances because of this. So. Because of pinball. Yes.

He brought out another tool. The charge of vagrancy. He stationed the vice squad outside known gambling dens and arrested all employees as being unemployed. The Chief said “I contend any employees of a gambling outfit whether he runs a wheel (which we will get to in a bit), handles a race sheet or is a sputterer on the sidewalk is a vagrant under the law. He is not arresting bar ownership pinball machines with this because they own a bar. They are not unemployed. The DA again said these are really dumb, dumb warrants, you should not being doing this to people but he did enforce some of them when it was really clear that they had no income other than gambling.

This only had the effect of scattering the gambling further. Bets were now handled by telephone or by runners instead of people showing up in person. And some operations moved their businesses out into the countryside. One spot was raided enough times that they moved to the county edge and those that wanted to play craps or roulette took a designated taxi that was parked in the parking lot of the old location to take them to new location.

Through pressure on AT & T and Western Union the telegraph lines were cut and they no longer ran to Wisconsin, Illinois, Indiana, Michigan or Iowa. And all of the 28 offices went dark. The press reported that horse gambling dropped. It said it dropped by 25% in Los Angeles, 90% in Chattanooga, and some places it disappeared completely. Such as Portland.

Now is this just one telegraph system? Yes. Or are they shutting down the whole telegraph system so someone in Milwaukee couldn’t send a telegraph to someone in Chattanooga even if it had nothing completely to do with gambling? They didn’t shut down telegraphs, they shut down this guy’s company. So he is using the lines to send this information. Think of it like the internet line. If you cut off Spectrum someone else can come along and still use the lines they put there but you just couldn’t get Spectrum anymore. Okay. So it’s like that. They cut him off from using them. Okay But he was just using them for gambling purposes basically. He may have been using them for other things but that is what he got his money from.

So Moe Annenberg the guy running this wire he was originally from Milwaukee. He was targeted on tax violations and had partners in Milwaukee who faced legal trouble. The Secretary-Treasurer of his company was charged with aiding a evading taxes, aiding his friend. His Accountant in Milwaukee, made false statements before a grand jury and Louie Simon, the guy who was providing the race results in Milwaukee, he was caught in the web too when it found out that he had bribed a witness to lie on Annenberg's behalf. Lot of people got in trouble when this all kind of came apart.

Removal of Moe Annenberg was a serious blow to the bookie profession. Results now had to come in by expensive long distance telephone calls or they had to wait until the next day when things were in the newspaper.

Annenberg ended up pleading guilty to tax evasion and died in prison. His son, Walter Annenberg went on to rehabilitate the family name. He created such notable magazines as TV Guide and Seventeen. It worked out well in the end and besides the dying in prison part.

Now we are in the 40s.

Police Chief John Polcyn, who had replaced Kuchesky responded to these allegations saying, “Any officer that was there was there in the line of duty at the time and that “Smoky” Gooden, owner of Smoky’s Smoke Shop may have had a police record but he hadn’t been involved in gambling in 15 years. Leave him alone.

So what is policy? Policy, also known as numbers, is a low cost gambling where a bettor picks 3 digits to match those that would be randomly drawn the following day. The game was common in Black and Cuban communities. Also Puerto Ricans have their own variation of it. And what it is is you would go and say I Pick the number 123 and there would be a set way that the number gets drawn. It would be like the next day in the newspaper. It would be how much money did a certain racetrack take in on a certain day. Some number that would be printed in the newspaper every day or every week. So there was no way this could be rigged. You would just have to see if that number was right the next day. If it was you get your money back. Now your odds aren’t very good because guessing a three digit number out of a thousand numbers is not very good but if you do win you're pretty good and you only have to pay between 5 cents and 25 cents. It is really cheap so a lot of people would do this every day.

So this wasn’t being printed in the newspaper? No. This is what they would do. They would get a big metal drum. They had pieces of rubber hose and the rubber hose they would write 1 to 78, put them in the drum, shake the drum up and pull out a piece of rubber hose and read the number. And that’s who wins.

So, it’s a simpler system, it’s also no evidence that they did this but it is a very easy to rig system. You have to trust that the guy pulling the number is not pulling a trick on you. I would think that you could pick any number that you wanted. At any given time would there be 30 winners. Yeah. There could be just a ton of winners and did they just divvy the money up between how ever many people won. So the less people that won, maybe the more money you would get. I guess it depends on what the ground rules are. It could be divided up evenly but a lot of times what it would be its there was a set return that was guaranteed and the problem with that is if too many people picked it the game would go bankrupt. Which did happen from time to time. So there were some of them relying on you are going to get 100 times return or whatever. It’s good if you are the gambler. It’s not good if you are the guy running the game and everyone picks the same number. But usually that’s not going to happen.

Alright, so the District Attorney asked the Judge to start a John Doe investigation into gambling. He says “Okay, first of all. We don’t want gambling. Second of all, we definitely don’t want police looking the other way or taking bribes. If they are walking into the Smoke Shop and not doing anything about it something suspicious is going on here.”

Stop again and I will explain what a John Doe investigation is. A John Doe investigation is this thing that is unique to Wisconsin. It is a Wisconsin only thing which is basically like a grand jury except the difference is a grand jury is when somebody is suspected of a crime. A bunch of people come in and testify. If they decide there is enough evidence to charge the person with the crime they charge the person with the crime.

With the John Doe, as the name implies, John Doe, there isn’t actually a target. So people come in and they testify and they take this information and then they decide who and what charges are going to come out of it. There might not be any. But they don’t know who they are going to charge when they start the investigation. They only know when they are done.

So can you give me an example of this? Like so if I am understanding you right they are going to bring in a bunch of people that are going to testify that they gamble. Yes. And then based on what all these people testify they decide okay who must be the person we can charge with this gambling ring. Is that kind of – yeah. That would be one way. After they hear enough testimony if they think there is enough evidence to charge somebody with a gambling offense or whatever it is that they are thinking of charging them with.

Sometimes they find totally unrelated things. There are a lot of times with John Doe’s where someone will come in and testify. Here they are looking into gambling but someone will come in and go rambling off and all of the sudden your thing is off the rails and you are looking into something completely different.

So it is a very strange thing that only Wisconsin has. And they are secret unfortunately.

Do they still do John Doe’s? Yes they do. And they are the only State that does it? Yes. That is so bizarre. It does kind of seem like a shady area. It’s not that different than what Congress does investigations. Because they will just call in people until they find something.

Harris had several men working for him including his own cousin. Smoky Gooden dropped out of gambling when he went broke in 1933 but he still hung around with everyone else. Those two men had since become enemies and each believed the other was trying to send him to the penitentiary.

Booker Page had heard that Harris had turned evidence into the police and found it strange that Harris seemed to know everyone that was subpoenaed before the John Doe panel before they knew they were subpoenaed. He stopped in at Harris’s bar 2 hours after being subpoenaed and Harris already knew about it. Booker Page said Smoky Gooden had no policy wheel at that time but Harris had one called the Delmar and one called the Santa Anita, which were more on the level than the rest of them.

In spite of having no wheel of his own, Gooden took money from others for protection that had little effect in thwarting raids. He did not know who was head of the policy racket but he had heard that it was either Smoky Gooden or Cornelius Ard, known as the big hand. Booker Page said that he did not involve himself with the wheels much anymore. But one time he had won $900.

One gambler was called to testify about gifts that he had made to the police. He said that he was a prolific gambler. He couldn’t deny it as he had been arrested for gambling 14 times. He remained there for 40 minutes on the stand and as he left he was smiling. This was private so nobody knew what he had said. Did he crack? Did he give up his friends? People were worried.

Another person testified that they helped Joe Harris in his policy game. Quote “When Joe told me the heat was coming I got afraid and quit. He said the newspaper took my picture going into Smoky’s. When asked if Smoky was the Policy King the gambler said “I don’t see how he could be King, he’s so poor”. When asked about police payoffs he said “I don’t think anybody could influence with the police the way they chased us”. “That’s the reason I left”. “Sometimes we would run like rabbits to get away, so I do see what protection anybody got.” “They chased all of us.” ‘If anyone was Policy King it was Joe Harris”. “He has more money or property than anyone.”

More people were called in. Smoky Gooden gets called in. The Big Hand gets called in. Guys running wheels known as The Phoenix, The Keystone and The Top Row get called in. These are all names of the wheels.

An Accountant gets called in. After this point they switched. These were all people in the Black Community. Now they are switching to the Jewish Community. They are going to expand their probe to the Jewish Community. That is where the money is. They interviewed one guy – He said ‘Yeah I am sort of a bookkeeper for a man called Joe Krasno, who the newspaper called “Milwaukee’s Gambling Emperor”.

He kept accounts of the gambling business, collected winnings and paid on bets. Together they four telephones at their horse betting parlor and a fifth phone that ran directly to Louis Simon., the guy with the horse race wire. They paid Simon $82.50 per week for that service. He was paid 30% of what the business earned. Bets typically never ran higher than $100.

Simon’s service was an aid to gamblers but the wire itself was actually not illegal; it was just a telegraph wire which is not a crime. So he had no fear of sharing his business transactions. He wasn’t gambling. He was just providing information. Outside the courtroom he was kind of sad. He said “Gambling isn’t actually that big in Milwaukee, there is gambling in cities a third of this size. And here you don’t even see any of the rough stuff that you see in other cities. Milwaukee’s not a problem.” He knew what he was talking about. Just earlier that same year the FBI had put a wiretap on mobster Charles “Cherry nose” Gioe.

And found out Joe’s wife had gone to Miami with Louie Simon. This guy is definitely hanging out with some mobster guys.

At this point in the probe they now had 175 witnesses. The court reporters had typed up 5,000 pages of testimony. They were still waiting for a few more subpoenas. They called in David Kohler. David Kohler said he operated a book upstairs (he was a bookie) at his tavern and he was paying Louis Simon $57.50 in cash each week to get race results. Kohler had 4 unlisted telephones. He claimed that he had actually quit bookmaking. He said “I’m not Involved in it anymore. I rent my space out to someone else.” He did show his taxes and showed that in the last year he had made $45.000 as a bookie. Translated to today’s money is $435,000.

They called in a bookie that worked at the Astor Hotel. He said he had started out as a chauffeur and worked his way up in the gambling business. Other people are called in. Oscar Plotkin who runs the Clock Bar. Jack Enea, a very notable mob guy who will be killed. They interview Joe Latona. Latona was only loosely connected to gambling but he later gets in trouble because he runs a brothel out of a bar called The Wind Blew In.

There are corporation records. A lot of notable guys were caught up in that and arrested. The Ogden Social Club was raided nine times. One that was arrested was John Triliegi who was one of the guys involved in the Reno heist.

Testifying after Lem Sputter was the Cigar Store Owner, “Hymie the Bum”. They were still waiting on the last 3 gamblers to be found. They were in hiding. Joe Krasno, the guy that was Milwaukee’s Emperor of Gambling was in hiding. His brother Maurice, known as “Chunky” was hiding. And Harry Glinberg, known as O’Malley was in hiding.

The former police officer came back to purge himself of contempt charges. This time he said that the story about taking money was crap. That didn’t really happen. I just made that up. He said I was mad at the Inspector, my boss. I worked hard at the police department. I was there for 9 years and the inspector let me go and I am mad about it. I think that if me saying this is going to make it hard on him then I am going to say it.

Joe Krasno, the Milwaukee Emperor, surrenders. He testifies that he took in $135,000 in gambling in the last year. He said that this wasn’t all profit. Some of it I had to pay to my brother, Chunky. And some of this money I made I later lost when I went and gambled it myself. So it sounds like a lot of money but I am also a gambler.

So the effects of the probe came down when assessments were handed out against different operators. George Jackson, who I don’t know how he fits into the story ends up owing $17,000 in back taxes which is $164,000 today. Other people, including Joe Harris who owed $6,700 which is $65,000 today. And another man named Fred Harold who owed $4,200 or $41,000 today.

The judge released a 51 page report with his conclusions showing that yes there was gambling, there was a lot of gambling but the police were not involved. He says look at how many times these guys were arrested. The police were doing their job. This was the Black community.

The Jewish community did a similar thing. They revoked licenses for taverns, some of whom moved to the outside of the city and got their licenses back in another surrounding area. Some of them moved out of the County. What most of them did was just give the license to somebody else and continued on with their business. One guy got his license revoked and then he had his nephew apply for the license and his nephew got it.

Other people are getting hit with back taxes anywhere between $100,000 to $200,000. A little higher in the Jewish community. And if you were caught failing to register as a gambler you would have to pay $750 to the IRS. I know what you are thinking. Why would you register as a gambler when it is illegal to gamble? This was the weird thing they did. You would have to have a wagering stamp and it would cost you $50 or something. It wasn’t much. So if you didn’t have it you would get in trouble for not having a wagering stamp. Which was a $750 fine. But the problem is if you do have the wagering stamp everybody knows that you are a gambler. So it’s kind of dumb.

There was a similar thing later where you would have to get a stamp if you were dealing in cocaine. Which is the same thing, if you get caught and don’t have the stamp you get fined but who in their right mind would buy a stamp that says that they deal cocaine.

I am not sure about the cocaine one but later the Supreme Court struck down the gambling one. They said that’s not right because it basically amounts to the government forcing someone to admit their guilt which denies their rights. They said you were already confessing to a crime before you even commit the crime. We can’t enforce that. So that got struck down.

Actually from Matt Prigge, who is the Milwaukee Historian. He says, One of two things can be taken from this. Yeah, he gave back to these churches but he’s also the guy who is taking all the money from the community and these gamblers. This is not necessarily a good thing. But maybe it is a good thing because these guys are going to gamble anyway. It’s not his fault they are gambling addicts.

The police officer who was either telling the truth or telling a lie – his life took a downward turn. After leaving Milwaukee he became a Private Investigator in Florida and but then he was accused of breaking into a woman’s apartment and attempting to rape her which is heavily frowned upon. The jury deliberated for 2 hours and he was convicted and sent to prison.