-Caveat Lector- An excerpt from: The Ohio Gang Charles L. Mee, Jr.�1981 M. Evans and Company, Inc. 216 East 49th Street New York, New York 10017 ISBN 0-87131-340-5 218 pps � out-of-print/one edition --[9]-- XXV. The King of the Bootleggers GEORGE REMUS HAD grown up on the northwest side of Chicago where, when his father was taken ill, he went to work at the age of fourteen for an uncle who owned a drugstore. George was a stocky, muscular boy, a fast talker who spoke with a trace of a German accent and who tended to use words that were a little longer than he could comfortably pronounce or smoothly work into his sentences. He was a bright boy, though, and within five years he had managed to buy his uncle's drugstore. During the next five years he bought a second drugstore, acquired a pharmacist's license, an optometrist's certificate, had an affair with a customer, married her, had a child with her, attended night school, and became a lawyer. By 1920, he was making $50,000 a year as a criminal lawyer, having an affair with a young divorcee named Imogene who worked in his office, and looking around for something else to do. Several of his clients, taking advantage of the laws that had been passed recently in Congress, were bootleggers, and Remus figured that if they were smart enough to make small fortunes, then he was smart enough to make a big fortune. Nor did Remus have any moral objections to alcohol or to getting around a law he considered foolish, although he was himself a teetotaler. Remus understood the law, and he understood the drugstore business; so he understood at once how to obey the law to the letter in buying and selling liquor for medicinal purposes. He also saw that a number of slow-witted distillery owners did not understand how to get around the Prohibition laws, and that he could buy their distilleries at bargain prices. He would then be both seller and buyer. "He had calculated," according to Thomas Coffey, "that 80 percent of the bonded whiskey in the United States was stored in government-controlled warehouses within three hundred miles" of Cincinnati. And so he divorced his wife, married Imogene, and moved with Imogene and her daughter by a previous marriage to Cincinnati. He was wild about Imogene, and she was in love with him. They worked together in their new business, and they made money faster than they could properly keep track of it. Remus had saved up $100,000, and he put $10,000 down on a distillery and deposited the rest in the Lincoln National Bank, to impress the bankers with his resources. Within four months, with bank financing, he was in the drug business, had formed a few corporations to receive the liquor his distilleries would sell; had bought a ten-acre estate, was negotiating for the purchase of several more distilleries, and had invited forty-four men to his office one day�including politicians, Prohibition agents, and federal marshals�and had given each of them an average of $1,000 as an introduction to his friendship. By the end of the year, he owned stills in Ohio, Kentucky, and Indiana. He had hundreds of employees, still workers, truck drivers, armed guards for his trucks, people to manage a bottling works and storage facility at Death Valley Farm, northwest of Cincinnati. He was in a business whose bookkeeping was necessarily so sketchy that he had to keep track of the operation in his head, and the business was expanding so rapidly that he could only estimate the total volume. In his first year, he moved perhaps three-quarters of a million gallons of liquor. Altogether, he was embarked on an enterprise that would gross something on the order of $50 million. He bought some of his permits from Jess Smith, meeting Jess from time to time�at the Deschler Hotel in Columbus, at the Commodore or the Plaza in New York, at the Claypool in Indianapolis. He could not remember just how many permits he got from Jess, but he figured Jess must have given him permits for at least 250,000 cases, paid for on a sliding scale of $1.50 to $2.50 per case, roughly $500,000 at a minimum. Remus made only one mistake. Impatient with all the government red tape, he went ahead and released some liquor from his warehouses without benefit of permits. Realizing that he was risking a different sort of trouble for this activity, and for general purposes of protection, he made another deal with Jess Smithentirely apart from his payments for permits. For occasional payments of $50,000, which added up over a period of time to an additional $250,000 or $300,000, Remus bought immunity from prosecution. He might be bothered by a naive Prohibition agent from time to time, but he need not worry. If a charge led to an indictment, the fix was in. Remus hadn't a worry in the world. pps. 145-147 ----- XXVI. Bribery and Corruption and Sex and Suicide CHARLIE FORBES HAD met Harding in 1915, in Hawaii, where Forbes was overseeing the construction of the Pearl Harbor naval base and Harding was passing through on a Senate junket. Forbes had "every needful quality," said Samuel Hopkins Adams, "of the universal good fellow and high-class confidence man." He was a pink, round-faced, redheaded, cherubic sort of a fellow�"breezy," said Mark Sullivan, "joke-cracking, hustling"�who wore bow ties and practiced the arts of flirtation, flattery, and seduction with the offhand dedication of a natural athlete. He took the Hardings out to see the sights in Hawaii, and called on them, too, with ingratiating frequency, lavish with his time and attentions and considerateness. He was a shrewd poker player. He loved to bet at cards and dice, and he won or lost with equal joviality. He loved to sit with a drink in his hand and tell a story, or hear one. He would roll in genially, with a boisterous greeting, and throw himself at a chair, saying, "Hello, Duchess. What about a little drink for a thirsty hombre?" He did not neglect to make frequent passes at Mrs. Harding, which may have been a unique experience for her, and she liked him. So did Harding. They both felt grateful to him and buoyed up by his presence. When Harding took office as president, he called his chum Forbes to Washington to take over the Veterans' Bureau�a department that had control of the construction of hospitals for veterans, and also of the purchase and disposing of hospital supplies. Although the Veterans' Bureau did not sound like a very grand operation, Forbes's bureau made some of the cabinet offices look trivial by comparison: he had 30,000 jobs at his disposal, and a budget of $500 million a year. Indeed, the jobs and budget grew as the bureau found more and more veterans to care for; in no time, it was discovered that patients were being encouraged to stay on in hospitals after they had been cured; a third of the patients at the tuberculosis hospital in Greenville, South Carolina, were not suffering from tuberculosis at all, and, at the Speedway Hospital in Chicago, 80 percent of the patients spent most of their time on the town. Because the veterans' hospitals were so overcrowded, it was essential to build more hospitals at once, and so Forbes turned immediately to the urgent need to let contracts to construction companies. It happened that, in the course of ingratiating himself with Harding, Forbes had met Harding's sister, Mrs. Carolyn Votaw, the wife of a Seventh Day Adventist minister whom Harding had absent-mindedly appointed superintendent of federal prisons. As a matter of course, Forbes practiced his flirting on Carolyn�and she fell for him. just how far she fell is not clear�she was, like her husband, a serious Adventist�but she responded to Forbes sufficiently that the Reverend Votaw threatened once to throw Forbes out a window. Carolyn introduced Forbes to some acquaintances of hers, Elias and Kate Mortimer, an attractive young couple; and Carolyn and Charlie, Mort (Elias) and Kate took to spending a lot of time together on the town. Charlie loved to throw expensive dinner parties in Washington restaurantsCarolyn and Kate and Mort had never had such extravagant fun�and, occasionally, when the mood took him, he loved a big weekend party�taking half a floor in an Atlantic City hotel, say, and inviting a crowd of Broadway stars and other celebrities to come down to the resort for the weekend and dine and party day and night. He did not neglect to pay attention to Kate, either, and even to, find a job for her brother in the Veterans' Bureau, and Kate, like Carolyn, could not help responding to his daring and his compliments. As for Mort, who happened to be a representative for the Thompson-Black construction companies, Forbes hinted broadly that, although he had to open up the hospital construction business to competitve bidding, he could always give a friend an advance look at a potential site so the friend could get in a really carefully prepared bid. For that matter, if all else failed, Forbes could always open up the sealed bids he got and let his friends know just what sort of bid they needed to submit in order to win. Mortimer thought it would be a lot of fun to take a trip across country with Forbes (Mort would pick up all the checks) and look over some of these potential hospital sites. So Mort and Kate and Charlie set out together. Forbes left Carolyn behind. It was his biggest mistake. They stopped in Chicago first, where they were meant to look over a site for a $5 million hospital, but they hardly had time to leave their suite at the Drake Hotel. It was such a comfortable set of rooms, and there was never a shortage of ice, or liquor, and they usually had five or ten people over for lunch or dinner, and the afternoons passed in continuous partying. Forbes could finish a quart of gin at a single sitting, and often did, and loved to sit and talk of deals, of what he could put over, and how there would be more than enough in it for everyone, and how he thought the future would be even more wonderful than the past. He said (this was confidential) that once he had put in his stint at the bureau, he was going to take over the Department of the Interior, and then there would be even more and better deals for everyone. He could talk a happy prospect, he could conjure deals worth millions over half a bottle of scotch or gin, he could hint vaguely of what might be done with the $5 million worth of narcotics in the Veterans' Bureau warehouses or talk fondly of a project to rent a farm (with a $15,000 kickback) where veterans could be taught agriculture (and Forbes could give the farmer's wife a job in the bureau), for he liked to talk about the veterans, too, and what he and his friends would do for the veterans, and of how no one loved the veterans as much as he did. He could also digress on the pleasures of duck hunting or recall what a wonderful man the president was or he could rise to give an after-dinner speech and be filled suddenly with a generous emotion and pull some old inaugural medals out of his pocket (he had somehow got hold of a lot of them) and present one to some astonished man with a personal testimonial message from the president himself (which Forbes would improvise on the spot). He could weep at times, and at times he could bully, and sometimes, when the whim would overcome him, he could flare up when a man offered him a "commission," and declare with pure and righteous anger that he stood "for no graft." He had dignity and, at times, a lofty moral sensibility. One afternoon, Mort returned to the suite at 4:30 to find Forbes and Kate in one of the bedrooms, on the bed togethershooting craps. Forbes had his coat off and a bottle of scotch at hand, and he was in a fine mood, having won $220 from Kate. Fifteen or twenty people were out in the living room, including J. W. Thompson of the Thompson-Black construction company. Forbes had mentioned to Mort (who was picking up all the bills for their trip) that the cash was running low, and Mort took this occasion to have a chat with Thompson in the bathroom. Thompson gave Mort ten $500 bills, and Mort called Forbes into the bathroom and passed the money along. By the time they had reached the West Coast, Forbes had gotten perhaps another $25,000 from the Thompson-Black company�and he and Mort were having squabbles about Mort's wife. One of Mort's employers told Mort not to get upset and spoil a good deal for everyone. Thompson, Mort, and Forbes came to a rough outline of a deal whereby Thompson would add $150,000 to each bid he made for a hospital and give Forbes $50,000 of it. In Spokane, Mort and Forbes met with a man named Hurley and took a walk by a lake, where they agreed that profits would be split three ways: one-third to Forbes, one-third to Hurley, and one-third to the Thompson-Black group. He also laid on some side deals along the way. In Missouri, Forbes had agreed to buy a hospital site worth $35,000 for $77,000�and then insisted on renegotiating to raise the price to $90,000. In California, Forbes found a piece of land that an acquaintance had bought for $19,257. Forbes paid $105,000, with an understanding that he would take a $25,000 kickback. Still, Mort was not happy with Forbes. Kate was too often found alone in hotel rooms with Forbes to keep explaining it away. By the time they had closed their deals on the West Coast and headed back for Washington, Mort was in a vengeful rage, Kate was talking of a separation, and Forbes had lost patience with Mort and had taken a moral position, telling everyone he would not do business with any firm that Mortimer represented. But worst of all for Forbes, Carolyn Votaw had kept track of all his movements on the trip. Troubles never preyed for long on Forbes's mind, however. Back in Washington, he had plenty of business to attend to, including the question of what to do with the contents of the supply depot at Perryville, Maryland, which consisted of fifty separate buildings, crammed full of sheets, towels, liquor, drugs, gauze, pajamas, paper, thread, monkey wrenches, grindstones, and hundreds of old trucks. In order to sell any of the stuff as unnecessary war surplus, Forbes had to draw up a list of the goods he meant to sell and show the list to the coordinator of the budget, a Colonel Smithers. Forbes sent such a list to Colonel Smithers one day, itemizing those goods that Forbes said were damaged or spoiled and that he would like to clear out of the warehouses. Smithers approved the list in a few minutes as a matter of course (except the soap, saying that the army and navy could always find use for soap), and returned it to Forbes. When the list came back to Forbes, he attached two more lists to it�amounting to more than three times the length of the original list�and the next day he sold it all to some friends: 84,920 bed sheets, 72,000 of them brand-new, in unopened packages, bought for $1 each, sold for 20 cents apiece; 1,169,800 towels that had cost 54 cents each, sold for 3 cents apiece; 98,995 pairs of pajamas made by women for the Red Cross and given to the army, sold for 30 cents apiece; 47,175 packages of gauze, sold at 20 percent of cost; 5,387 pounds of paraffin paper bought for 60 cents a pound, sold for 5 cents a pound; thread bought for $1.05 a pound, sold for 21 cents a pound. Altogether, for supplies worth between five and seven million dollars, Forbes's friends paid $600,000. They took it away as fast as possible, in 155 freight cars. While Forbes was selling these items from the warehouses, he was buying more gauze, and paying $1.031/2 each for new sheets. He not only replenished the stores he had depleted, however; he also looked around the warehouses and noted which items were entirely lacking. Among other things, he bought 35,035 gallons of floor cleaner and 32,115 gallons of floor wax (worth 1.8 cents per gallon) for 87 cents a gallon, a supply sufficient to last a hundred years. "You are missing the real old times," one of Forbes's employees, who was out selling some bureau property, wrote to a friend back at the Washington office. "Hunting season is on-rabbit dinners, pheasant suppers, wines, beers, booze�and by God we haven't missed a one yet.... Oh, Boy! ... we cat and wine with the mayor, the sheriff, the prosecuting atty. To hell with the Central Office and the work ... the fun is in the field.... Let me know when Forbes is going to sell by sealed proposals, then's when I get a RollsRoyce." Carolyn Votaw no longer found Forbes so amusing. His trip west with the Mortimers had finished him with her, and when she heard of the doings at Perryville, she went to the Harding's old family doctor, Charlie Sawyer�who, because the president had appointed him surgeon general of the United States, shared some responsibility for the care of veterans. Mortimer told Sawyer about the storage depot, and Sawyer went to Harding. At first, Harding refused to hear anything bad of Forbes, but when the magnitude of the graft finally made an impression on him and it was clear that he had only heard of a small part of Forbes's activities, he panicked. He got Forbes into his office, put him up against the wall, took him by the neck, and shook him-shouting "You yellow rat! You double-crossing bastard!"�and quickly sent him off on a mission to Europe to get him out of the country and cover up the story. The embarrassment of the Veterans' Bureau could not be so easily buried, however. The newspapers learned of it, and Congress decided to look into it. Then the story was given renewed attention when one of Forbes's aides, a lawyer named Charles F. Cramer, proved unable to arrange things comfortably in his mind. Anticipating the charges that would ultimately touch on his reputation, and having a well-trained lawyer's exact understanding of the meaning of the charges, Cramer locked himself in the bathroom of his house and put a bullet through his head. pps. 148-155 ===== XXVII. More of the Same with the Jap and Harry Mingle AT THE END of the war, the Standard Aircraft Company and the Standard Aero Company found that they had received from the government $16,416,680.15 as part of the American effort to produce fighting planes to send to France. No American plane ever reached France during the war, and the two Standard companies could not account at all for $9,948,028.42 of the money they had received from the government. The Standard Aero Company went into bankruptcy, and the Standard Aircraft Company was liquidated after handing over some of its assets to Mitsui and Company. Mitsui and Company had owned and financed the two Standard companies through an American named Harry Mingle. By the time Daugherty arrived at the Department of justice, his department had been left with the job of collecting the sum of $2,267,342.75 from the Standard Aircraft Corporation�which was the largest amount that Justice Department attorneys had determined they could get back. Mitsui, meanwhile, decided to cut its losses and pay a bribe to stop the justice Department suit. Gaston Means had several techniques for collecting bribe money. His favorite was to rent a couple of adjoining rooms at the Vanderbilt Hotel in New York and put a large glass fishbowl in the middle of one room, station himself in the adjoining room, and watch the bowl through a peephole. Purchasers of favors would leave their money in the bowl and depart, never seeing Means. For the Mitsui bribe, however, Means simply waited in a room at the Bellevue Hotel in Washington. "A Jap," he said, stepped into the room, handed him one hundred $1,000 bills, and left. Means gave the $100,000 to Jess Smith, and the Justice Department dropped the case. Some time later, it was difficult to trace just who had agreed to what with whom, for Mitsui's man, Harry Mingle, was found dead in New York City. Pps.156-157 --[cont]-- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, Omnia Bona Bonis, All My Relations. Adieu, Adios, Aloha. Amen. Roads End Kris DECLARATION & DISCLAIMER ========== CTRL is a discussion and informational exchange list. Proselyzting propagandic screeds are not allowed. Substance�not soapboxing! 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