Frank John Wilson

“ These places were controlled or run by a syndicate sometimes referred to as the Cicero syndicate. I was the cashier in these gambling houses, during the afternoon I took bets which the customers placed on the outcome of the horse races, and after the race track business was closed for the day, all the cash remaining after the race track bets had been paid off was placed in the office safe by me. The business of these gambling houses was not confined to race track betting as various games of chance, such as craps, roulette, etc., were run by the house from which the business derived a profit. ”

“ The income of the taxpayer was derived from gambling, houses of prostitution and bootlegging. He was referred to by his associates in the newspapers of this country and abroad as the "Colossus of Racketeers", "King of Gangdom" and the "Big Shot". Although his income was secured wholly through the illegal activities of a large organization of which he was the leader, his activities had not been seriously interfered with by city, county or state authorities. ”

“ It was necessary from time to time to move the gambling business from place to place in order that we might not be disturbed in the operation of the business and just before Jimmie's departure we had to move to the place known as The Subway. About the time Al Brown declared himself in on the gambling business and a short time after Mundi left for California, Ralph Brown, whom I later knew to be Ralph Capone, appeared, and Ralph announced to the employees that Pete Penovich was to be the new manager and would have charge of the business in the future. ”

“ At the time of the murder of Assistant States Attorney McSwiggen, the Chicago police raided the Harlem Inn in their efforts to locate Al Capone who was accused of causing the murder of the states attorney but he was not found on the place. They did find a supply of firearms, a large amount of dynamite, whiskey and detailed records setting forth the daily income of the Harlem Inn derived from prostitutes. ”

“ Important witnesses were sent by the defense to other states, also out of the country, and the principal defense witnesses gave perjured testimony at the trial. During the trial the defendant and his armed body guard, Phillip D'Andrea, glared at the government witnesses instilling fear in them and causing them to temper their testimony in favor of Capone. The most daring effort to thwart the case of the government was an attempt to fix the jury. ”

“ The facts regarding this plot of Capone to put an end to the investigation were carefully guarded and reported only to our superiors and to P. F. Roche, Chief Investigator for the States Attorney of Cook County as we felt that any publicity regarding Capone's plan to cause the murder of four officials would instill greater fear in the minds of all our witnesses and make them purposely forget about their dealings with him or cause them to give perjured testimony for fear they would be murdered by the Capone organization if they assisted the government. ”

“ As this investigation established that the funds for the purchase of the home and for the improvement of the estate were entirely furnished by the taxpayer, Al Capone, it is believed that the government lien covering the property is valid and it is recommended that unless the tax assessed is paid within a reasonable time that appropriate steps be taken to foreclose the lien and cause the sale of this property, the proceeds to be applied to the unpaid taxes. ”

“ The gambling establishment in Cicero was closed on the night of the murder (April 26, 1926) and the employees and members of the Capone organization promptly left Cicero as the police publicly announced that the Capone gang would be cleaned out of that town. The day after the murder Frank Pope, the manager of the gambling establishment instructed Shumway, the cashier, to return to Cicero and secure the surplus cash on hand from the gambling business which cash was kept by Shumway and Pope in a large safe in the Western Hotel. ”

“ Louis La Cava testified that the daily records relating to the profits of the gambling business at Cicero were kept in this safe deposit box by Capone and himself. Testimony of Frank Pope, one of the managers of the Cicero gambling establishments, L. A. Shumway and other witnesses, established that La Cava made regular visits to the gambling establishment to inspect their record of profits, that he regularly collected the surplus and that he was regarded as the collector and representative of the owner of the business. ”

“ The Capone syndicate purchased the property known as the Harlem Inn on February 29, 1924. It was bought under the name of Louis Lipschultz, a brother-in-law of Jack Guzik, and on January 7, 1925, the property was deeded by Lipschultz to Jeannette Keithly, a sister-in-law of Jack Guzik. Capone was aware of the efforts of Hoover, Bragg and Morgan to have the sheriff and the state authorities close up this place on account of its being a house of prostitution and he tried to enter into a deal with Reverend Hoover who refused to consider any such proposition. ”

“ In order to locate them and serve them with subpoenas it was necessary to pick them up on the streets near the Capone headquarters at the Lexington Hotel, at racetracks, at raids on gambling establishments and houses of prostitution, at Cicero hotels and at night clubs, also through various subterfuges. Considerable of the work in locating witnesses was performed at night in and around the hang-outs of the Capone organization by Special Agents Tessem, Malone, Converse and Sullivan and the agents were facing danger in the event their identity was discovered by the gangsters. ”

“ The telegraph operators employed to receive the race information and results over the wire from the General News Bureau were Jimmie Stanton and Joe Funk. All employees in the establishments were paid in cash each day. Cashier's checks were not used by me in paying off the winners of the bets. I do not remember of any time, after Jimmie Mundi discontinued in Cicero that Ralph Capone, Jack Guzik, Frank Nitto or Al Capone made any bets on the horses. ”

“ On the occasions when Al Brown came to the gambling houses operated by the syndicate, he was usually accompanied by Mops Volpe. Al Capone's younger brother, known as Bottles, was employed in the gambling houses as Floor man and I think was paid $25.00 per day while business was good. On some occasions we would have from 300 to 500 persons in the gambling houses making bets,etc., and we would have from 20 to 40 persons employed. ”

“ A day or two after the new syndicate took over the gambling business Jack Guzik appeared at the place where we were operating and instructed me to turn over the surplus funds earned in the business to Bobbie Barton whenever he sent Bobbie to get the money and he said that when Bobbie telephoned to me informing me that he (Bobbie) was coming to the gambling house for the surplus funds that I should turn the money over to Bobbie. ”

“ He did not stay in the part of the establishment where the patrons conducted their business, but he cane to the office and talked with Frank Pope and Pete Penovich, the active managers of the business. At times he personally made bets with the establishment and was extended credit. Shortly after I was first employed in this business I was present one evening when some men, whom I believed to be the owners of the business, were in the office. "They were Mr. Louis Alteria, Jack Guzik, Dion O'Bannion, Louis La Cava, John Torrio and Alphonse Capone. ”

“ He has been convicted of evasion of income taxes and sentenced to three years in the Federal Penitentiary at Leavenworth, Kansas. He is now serving his sentence and was transferred to the Federal Penitentiary at McNeil's Island. Ralph Capone handled the activities of the syndicate in operating breweries and the sale of beer. Frank Nitto was the other principal in the Capone syndicate and he handled the activities of the organization in whiskey and alcohol, Nitto pleaded guilty to tax evasion and served a sentence of eighteen months in the Federal Penitentiary at Leavenworth. ”

“ Various other large expenses also taken from the income of the women for meals, auto transportation from a downtown hotel to their place of employment and for room rent at the hotel where the syndicate required them to live. In addition to the income from the prostitutes reflected on these exhibits, the syndicate also had considerable income at the Harlem Inn from sales of liquor and from meals served to patrons. ”

“ There is no doubt that if Capone thought he could remove the 'heat' from himself and his gang, and bargain for a reprieve from the raids and arrests and convictions resulting from the investigators' activities, he would have done so, even at the cost of putting the Lingle murderer on a doorstep somewhere, dead. ”

“ On October 10, 1931, the writer recommended (Exhibit No.165) that a jeopardy assessment be immediately made against the taxpayer and that liens be filed by the Collector of Internal Revenue in Florida in order to protect the interest of the government, as we found that the taxpayer was attempting to dispose of his home, the household furniture, two yachts and a McFarlane automobile for $150,000.00. The assessment was made and due notice served on the taxpayer at Chicago on October 24, 1931. The assessment against Alphonse and Mae Capone for four years, 1926 to 1929, inclusive, was $137,328.16. ”

“ Capone, that this respondent's activities were linked with those of an organized body of men whose outlaw camp is at the Lexington Hotel. Of this body the defendant Capone was chief. The respondent claims that he didn't know what this band was doing, but his understanding is that they were engaged in gambling and bootlegging.
"It is perfectly clear from a long array of conclusive circumstances that this band exercises a coercive influence over those with whom it comes in any contact which is nothing less than insurrection against the laws of the United States. ”

“ The tactics used by Penovich were used by other witneeses employed around the gambling houses in their attempts to shield the leader of their organization, and on account of their antagonistic attitude the United States Attorney decided it would be inadvisable to use Peter Penovich, Frank Pope, Ben Pope, Robert Barton or Louis La Cava as government witnesses at the trial of Capone. ”

“ They establish that the total income of the Harlem Inn from this source for that period amounted to $6,398.00. On that basis the yearly income of this house of prostitution was $129,000.00. These daily records cover the period from April 6, 1926 to April 25, 1926. On these daily sheets in column No. 1 appears the name of each prostitute connected with the Harlem Inn on that date. In column No. 2 appears the income of each prostitute for one night. In column No. 3 the entries represent 50% of the income or each prostitute taken by the establishment. ”

“ His immunity was explained by statements of members of his organization that all of their activities were protected on account of large graft payments made by them to insure the unmolested conduct of their various businesses. ”

“ These tickets contained a number and when a customer made a bet a record of the bet was made on the sheet retained by the house and the number was placed in that record. The ticket bearing that number was given to the customer for his identification in the event that the horse on which he had bet won the race, and he was entitled to collect a winning bet. ”

“ I own the place". Mr. Morgan then escorted Capone upstairs to Lieut. Davidson, in charge of the raid, saying "Here is the man who says he owns the place"; that Mr. Hoover was then with Lieut. Davidson and that Capone said, "Why are you fellows always picking on me. This is the last raid you will ever make". Mr. Morgan said that the second floor of the premises was a regularly laid out gambling place with roulette wheels, a black Jack game, race charts, pool tables with covers used for craps and dice games and that money was lying on the tables at the time of the raid. Mr. ”

“ There is attached as Exhibit No. 104, a sworn statement made on February 20, 1931, at Palm Beach, Florida, by W. Joe Faulkner, a roulette wheel operator. He states that he was employed in gambling establishments in Cicero in 1924 and 1925; that he was employed in the Hawthorn Smoke Shop on 22nd Street on the first day it opened and remained about six months until Dioh O'Banion was killed, at which time the games of chance were closed for a short period ”

“ Leslie A. Shumway at Miami, Florida, on February 18, 1931, relating to the gambling business conducted by the taxpayer, Capone, in Cicero, Illinois. Mr. Shumway was cashier of the establishment and made the entries in the book record referred to above as Exhibit No. 5. ”