CHAPTER 12

I CAN GET IT FOR YOU NO SALE

You remember the movie The Graduate? Well, Dustin Hoffman’s family had a big pool party to celebrate his college graduation. In the middle of that party this businessman took him aside and, very quietly, whispered one word of advice: “Plastics.”

Well, almost the exact same thing happened to me. After I got out of the army I was hanging out not by a pool but around the pool hall, running numbers, and trying to figure out which way to go. This older friend of mine took me aside and whispered in my ear the one word, “Shit.” Then he added: “Remember, kid, there’s more money in shit than there is in gold.” Happy graduation.

It was the best advice I ever got. Bootlegging, smuggling, ticket scalping and assorted other small businesses may not sound as exciting as making a hit, smuggling dope or running numbers, but they have been profitable for me for many years. And money—not excitement—is the name of the game. I’ve made bootleg perfume and liquor, I’ve duplicated tapes and records, I’ve smuggled cigarettes and other taxable items, I’ve scalped tickets and sold cars. Anything to make a fast buck. And, in every single one of these operations, I’ve had a very important partner: your so-called honest citizen. Your honest citizen is not honest. He may not be as big a crook as me but he’s a bigger hypocrite. “We have this terrible crime problem,” he says, “and I pay my taxes, but the police still don’t do anything about it. What you got to sell me today? Hot TV set?”

One of the more lucrative businesses in this country today is smuggling cigarettes. Not diamonds, minks or watches. Cigarettes. Paper and tobacco wrapped tightly together, to be set on fire. Most states charge a heavy tax for every pack you buy, and that tax just about doubles the price. By going to North Carolina and buying the cigarettes himself an individual can eliminate the tax. Right now, for example, the tax on one carton of cigarettes in New York State is $2.26. The going price for a carton of cigarettes in New York is around $5.10. In Carolina the price is $2.33 a carton, which gives a “salesman” a profit area of almost three dollars to work in. I usually charge $3.50 per carton, which is fair and which gives me over a buck a carton profit. And I never have a shortage of honest citizens willing to cheat their government out of a couple of dollars in tax money.

There are a number of different ways of getting rid of the cartons. I can walk into any office—cold—and say to the receptionist, “Anybody want to buy cigarettes?” She knows what I mean. Five minutes later she’ll come back with an order for 100 cartons. I just go downstairs, hop in the back of my panel truck and fill the order.

Or I can find some guy that has a cigarette machine in his place and sell directly to him. If I do that, though, I’ve got to find out what the tax-stamp number for his area is, have a stamp made (which costs about $50) and make sure every pack is stamped. That way, if the tax inspector comes around, he can’t tell the bootleg cigarettes in the machine from the real thing. In most cases the machine owner will mix up packs of my cigarettes with the packs he buys legally because his distributor would know something illegal was up if, all of a sudden, he stopped buying from him.

Or third, I can find a machine myself and pay the owner to let me use it. I can pay him more per pack than he makes normally, so you know he’s going to go along with me. The cigarettes are stamped, and the customer never knows the difference. It takes a little longer to get rid of a load by selling through your own machine, but there is more of a profit. You can get as much as 60 cents per pack in most machines, which means you’re making a good living.

One of the really nice things about cigarettes and other bootleg items is that you rarely have to put up very much money of your own. At one point I had a deal going with one of the biggest shylocks in the country, a man I mentioned before, Joe Cheese. When New York State first started to raise cigarette taxes he contacted me and told me he had a deal. At that point we were paying $1.65 per carton in Carolina. He told me, “I want you to go down there and pick up forty thousand cartons.”

“That is not exactly confetti, you know,” I said. “It’ll cost sixty-six thousand dollars.”

He handed me a paper bag with $75,000 cash in it. “That’ll cover your trucks, expenses and give you enough money to make a few payoffs if you get nailed,” he said. “If you go down [get caught] you don’t have to give me back nothing. If you score you owe me eighty-five thousand dollars.” He initiated the whole deal, but I had to do all the work and take all the chances. I wasn’t surprised that he called me because we had earned together before and he knew I had never tried to beat him for a dime. So I took the money and went down there and came back up. I got rid of the entire load in ten hours. I sold them mainly to guys who wanted to hustle them themselves, and I charged them $2.35 a carton, which gave me a 70-cent profit. From the original $75,000 I made another $28,000. I gave Joe Cheese his $85,000, which left me with $18,000 clear for myself. This worked so well I was doing it almost once a week for about six months, which was not bad.

I would usually pay him on Thursday afternoons. He has this restaurant and I would walk in carrying a shopping bag, with a towel pushed in on top, filled with twenties and fifties. We finally had to stop because it got too hot. The state of New York got smart and sent tax people down to Carolina to make deals with the agents in the wholesaler’s office. They offered them rewards for turning in bootleggers with New York State license plates. The wholesalers would copy down your license-plate number and call the New York people after you left. When you reached the state border the New York agents were waiting, and if they grabbed you, the guy in the wholesaler’s office who made the call would get 25 percent of the total amount of the tax value. They could make as much as $10,000 just by picking up the telephone. That’s why I had to stop, too many dishonest people to deal with.

I got out just in time. The New York State agents were on my trail and I decided to quit completely. But a onetime numbers runner named Frank talked me into making one last run. He had a good plan, I drove an empty truck down to Carolina and he drove a similar truck filled with furniture. He stopped just over the border and I went and filled the truck with thousands of cartons of cigarettes. I had no doubts that within a minute after I left someone at the warehouse was on the phone to New York State with the license number and description of the truck.

On the Carolina side of the border we pulled both trucks behind a diner and switched the loads. He put the cigarettes in his truck, and I stuffed the furniture in mine. Then I headed back to New York. He gave me a few hours’ start and then he followed. Sure enough, a few minutes after I crossed into New York State I heard sirens. They were waiting for me. “What’s the problem?” I asked.

“What have you got in the back?” one of them asked.

“Just some furniture. Something wrong with that?”

There were two of them and they sort of laughed. “Open up the back, please.”

“No I don’t please,” I told them. “You guys got a search warrant?” They said they didn’t. “Well, if you want to see what’s in the back of this truck you’d better get one.”

These guys were smart alecks. “No need for that. We are just going to follow you wherever you go. We’ll see what you have when you stop.”

“Suit yourself,” I said and started driving. I drove them in circles for about four hours and then I headed to a legitimate warehouse. I opened the back and began unloading the furniture. These guys couldn’t believe it! They knew they had been fooled. But it was too close for me. I told Frank I was through going down and if he was smart he wouldn’t make any more trips. “It’s over,” I explained to him.

Obviously he wasn’t so smart. About three weeks later my telephone rang about four in the morning. I picked it up and asked who it was. “Joey?” he said. “This is Frank.”

“Who?”

“It’s me, it’s Frank.”

“Who?”

“You know, Frank. Carolina. Cigarettes. That Frank. I’m in jail and I need some help.”

“Listen, buddy,” I said, “it’s four o’clock in the morning and you’ve got the wrong number.” Then I hung up. He was released on bail and came to talk to me. I didn’t give him a chance to open his big mouth—I punched it shut for him. “You’re an idiot,” I screamed. “I told you to get out when you could, but you were too smart to listen. Then you call me from jail! Now don’t bother me with your problems, and don’t get me involved.”

Another business I found to be extremely lucrative is eight-track tapes. At one point bootlegging records was a major business, but since the introduction of tapes most of the action has gone that way. I don’t steal tapes, or buy them; I have them manufactured. There is a plant in New Jersey that does nothing but make duplicate tapes. They can duplicate any tape made today and do it with the same quality as RCA, Decca, Atlantic or any of the other outfits. All I have to do is decide what tape I want and go and place an order: 5000 Tom Jones or 5000 Rolling Stones or a few thousand Jesus Christ Superstar. I don’t even have to bring a sample tape with me; the manufacturer has everything on hand, and his duplicate will be exact down to the color of the cassette plastic. The entire tape, cartridge and everything, winds up costing me at most 40 cents apiece to make. The only other expense I have is getting the labels printed, which is as easy as finding a small print shop, and then pasting each label on by hand.

Normally these tapes go for anything between five and eight dollars. I get two dollars a shot for them, and I can get rid of at least 20 dozen at a clip. I deal mainly with distributors (although occasionally I’ll walk right into a store and tell them what I have). Distributors are always anxious to get their hands on bootleg stuff because their customers—the store owners—can’t tell the difference. A lot of the time, in fact, the distributor will tell the bootlegger what tapes are worth making up. A distributor can make as much as an additional $2.50 or $3.00 per tape when he buys from me. This becomes a hell of a lot of money after a while.

I have also been involved in the manufacture of perfume and liquor, both high-profit items. In fact, any highly taxed item is fair game. For perfume, all you need is a good dishonest chemist and some materials and you’re in business. I know guys who can make Joy, Chanel, Christian Dior, Arpège, anything you can name and they’ll make it almost as good as the original manufacturer. Then they buy bottles from France or have some guy in a glass factory make them up, get labels from a printer, a guy to make boxes, and they’ve got a going business. To put the entire package together costs maybe 75 cents, cheaper if you’re dealing in big amounts, and in the store this stuff, or very similiar stuff, is selling for at least $31 a bottle. And the guys making the merchandise are plenty skillful; only an expert is going to be able to tell their stuff from the original.

The sales approach is a little different from tapes and records. Around Christmas is the best time of year for this type of operation because everyone is looking to save money on presents. Whoever is pushing the stuff will contact a number of different businesses and say, “I’ve got some perfume that is slightly hot. Because of that I’m prepared to let you have it for seven dollars per bottle.” Everybody knows that there really is a lot of hot stuff around, so they believe the story. They usually ask for a sample and some time to check the stuff out. So the salesman leaves a bottle, the potential customer compares it to the real stuff, finds it to be just as good and buys maybe 50 or 100 bottles. Everybody is happy: the buyer, the seller and the person who gets the perfume. I have financed a number of perfume deals. The split is 50–50 between the bank and the manufacturer after the cost of making the stuff is deducted.

Once I actually had a still operating … in the Bronx! The idea first came to me when I met a guy named Louie Five, who was in the trucking business in New Jersey. He had been a bootlegger during Prohibition, at one time operating a still on Staten Island, and knew the business. “What do you think the chances are of setting up a still now?” I asked him. He said if we found the right location there would be no problem. He explained that the operation had to be set up in an area where there was plenty of running water, both to use in making the alcohol and to carry the fermentation down to a river or out to sea. It also had to be in a quiet area where we wouldn’t be bothered by people nosing around.

This is not an easy thing to find in the New York area. I spent four days riding around until I went upstate a little and found the perfect location. It was an old unused storehouse on the grounds of what I thought was a private hospital. The building itself was set back from the rest of the place, and there was a big hedge that separated it from the buildings. There was also a flowing brook that ran right through the grounds.

I took my man to see the place, and he took one look and started laughing. “You know what this place is?” he asked me. I told him I thought it was a hospital. “It’s a sanitarium! It’s a place where alcoholics come to dry out. The first time the wind shifts, the people here would go nuts.” He laughed all the way back to New York.

We settled on an old abandoned brick building up in the Bronx, in an area called West Farms. The building was two stories high but the middle floor had been torn out to make one big room. We never found out who owned it—we had no intention of paying rent—but we found some papers lying around which indicated the last tenant had manufactured coffins.

The place was ideal because it was in a deserted area and there was a little creek out in back that eventually emptied into the East River. It took us about two weeks to get the place set up. We repaired the chain-link fence out in front, bought a lock and hung a “Beware of Dog” sign on the gate. For power we ran a line to a Con Edison power terminal a few blocks, away and I’m sure they never knew we were there. Finally we bought big pieces of sheet metal and copper tubing and everything else we needed to make the vats ourselves. We welded the pieces of sheet metal together, coated the outside with epoxy to make sure they didn’t seep, and we had our vats. At the height of the operation we had three full vats cooking all the time.

Once we got the place set up we started buying sugar, sugar and more sugar. You need a tremendous amount of sugar, but naturally you have to be very careful where you buy it. If you buy too much at one time at one place, especially from a wholesaler, you might end up in a lot of trouble. They might take a special interest in you to find out what you’re doing with all that sugar. To avoid that we made dozens of trips into supermarkets, buying no more than 10 or 15 pounds at a time. We did nothing else for two solid weeks but buy sugar, going from store to store, throwing the stuff in the back of my van and then on to another store. Along the way we picked up the caramel and coloring we needed.

The only thing bad about the entire operation was the smell. And that was bad. Alcohol has a very strong odor, so usually you have to limit your operation to the winter months and pray for a lot of windy days. But there was nothing you could do about it inside. Most of the people working there wore gauze masks, but even if it wasn’t in your nose and mouth all the time, it still got all over your clothes. I remember one night I stopped into Patsy’s Pizzeria to see a guy and I was wearing the clothes I had been working in all day. He took one whiff and turned green. “Shit,” he said, “you smell like you just came out of a liquor factory.” I told him he was exactly right, I had a still operating in the Bronx.

He said, “Sure you do. And I’m Al Capone.”

What was I going to do, argue with the guy? To this day I’m sure he still believes I’m one of the biggest drinkers in town.

The key to making alcohol is getting the right guy to brew it for you. If the right guy makes the stuff there is absolutely no way you can tell it from the legitimate. There are a lot of guys in this country who brew good stuff, and I would guess that maybe 15 or 20 percent of all the booze you buy in bars in big cities is bootleg.

A lot of it is made down South and brought North. There is a flourishing market from Baltimore up the coast to Boston. Getting the bottles and labels is easy and cheap. In our still we were making Jack Daniels, which is a very big-selling Tennessee mash whiskey. We would tell people it was hot and ask for six dollars, which is about two dollars below legitimate price. It was costing us an average of 35 to 40 cents per bottle to make it, which means we were making five and one-half dollars per bottle profit. That one winter we made abut 40,000 bottles and more than $200,000.

Of course, if you’re making booze you can’t do anything else. You’ve got to work 15 hours a day, seven days a week, and this is ball-busting work. At our peak we had seven men—mostly people just out of prison—working for us filling bottles, pasting labels, loading trucks and distributing the stuff.

There is very little bribery involved in manufacturing because you do not want to let anybody know what you’re doing. When you start paying people the word has a way of getting around. And you’re violating federal tax laws, which is not a good thing to do. If the feds are so lucky as to catch you they can make you go away for a few years, as well as levy a pretty heavy fine. The key to not being caught is a closed mouth, a good wind and a fast stream.

There is also a booming market for almost every type of bootleg cosmetic. All you have to do is buy one legitimate bottle of whatever you want to make and find a good chemist. He will break down the components and be able to come pretty close to exactly duplicating the original product. I know one individual who is a true genius in this field. His name is John McLellan; at one time he was known as the Acid King because he was one of the country’s biggest LSD dealers when it was still legal. I tried to hire him to make something for me but I couldn’t pay him enough. He was so rich from working two or three months a year he just didn’t have to work anymore.

Another chemist I know got caught making pills and went to prison. The day he got out there were ten legitimate drug companies ready to bid for his services. That’s how good these people are.

One item I’ve never had any trouble getting rid of, when I can get them, is tickets. Football tickets, fight tickets, theater tickets, anything there is a demand to see, people will pay phenomenal prices for. I have made a decent income “scalping.” In one instance I got the word I could get 1000 tickets for a professional football championship game. The price was three dollars per ticket above face value. Now, even though this was before the days of the Super Bowl, there was great interest in the championship game. I contacted some of the ticket agencies around town and one guy took the whole load without question and gave me six dollars above face value. A quick $3000 profit with no sweat.

Ticket scalping is not lucrative enough for organized crime to bother with it on a regular basis, but a lot of casual crooks (and who ain’t?) supplement their incomes this way. But the guys who make real money in scalping are the insiders.

For instance, there was a guy who worked for the Brooklyn Dodgers, and who is still in baseball today, who used to double his annual salary whenever the Dodgers got in a World Series. He would go from agency to agency with his little black bag and tell them what he had and how much he wanted. I would estimate he was good for about $30,000 each Series, which was a lot more than the players were making.

I’ll give you another simple racket. Next time you go into a movie theater, watch the ticket seller carefully. See if she punches you a new ticket or gives you one that is already out of the machine. Chances are, if she gives you one that’s already been punched out, she’s pocketing your money. It works this way: As you walk in the theater the guy who is supposedly ripping your ticket in half is actually pocketing your ticket and giving you the bottom half of one he has already torn. When he has done this a few times he’ll wander to the ticket booth when no one is looking and slip the untorn tickets in. The ticket seller will resell them, without-ringing up the money, and split the proceeds with the usher.

One more racket that I am particularly fond of. This individual I know was working for a major distribution company. He was in charge of giving out samples: soft drinks, soaps, anything. Whenever a company came up with a new product and hired this distribution company, he would be sent on a long promotional trip. He would have maybe 1000 cases of soap or 24,000 cans of soda to hand out in maybe 15 towns. What he would do is distribute 200 of the 1000 cases and maybe 4000 of the 24,000 cans and sell the rest to storekeepers at a very low price, four cents a can, for example. That’s still $40 a thousand, and he was making as much as $800 a week doing this. I remember he once went to Oklahoma with cases and cases of soap. He distributed a few and sold the rest to people who owned laundromats. Usually he didn’t even have to worry about being checked up on, because he was splitting the proceeds with the man who was supposed to be doing the checking.

The system is set up so that anybody who uses his or her head can beat it. A credit card, for example, is money from heaven. There are a number of ways to get your hands on a credit card. A stolen card runs about $50, depending on how glutted the market is. Or if you can get to somebody inside a credit-card company, he can issue a card which can be used six or eight months before you would get nailed.

There are a few important things to remember about using a stolen credit card. Never use it to buy gasoline. Unless, of course, you’re driving a stolen car. Because the attendant is going to take your license-plate number and eventually the law will be able to trace the card back to you. And second, never use it to buy anything worth more than $100. If you go to a nice restaurant, you can present the card and have a helluva dinner. You can buy a $35 radio or shirts or shoes, and as long as it is under $100 they are never going to run a telephone check on you, and the list of hot cards is always at least a week behind. The only place you might be able to use a card for more than $100 is at an airline counter because they very rarely check. Just make sure you don’t buy a ticket in advance and give them your right home address, because if the card should be reported stolen in the interim you would be very easy to locate.

One company everybody cheats is the telephone company. The phone company is like the IRS—you’re supposed to try to cheat them. Phones are great. I know a mechanic who can turn a pay phone into a private phone with a few magnets. You drop one dime in and you can call all over the world. We had him rig our phones once when we had a small bookie operation going.

I’ve used fradulent telephone-company credit-card numbers for years. A man who used to bet with me works inside the phone company and he lets me know when the credit-card code numbers are being changed. There is no danger involved. If you make a phone call with an old number they just tell you they can’t put the call through. You can always hang up and walk away from the phone.

I also make a lot of calls and charge them to a third party, only the third party doesn’t know it. If you know the phone number of a company that makes a large amount of long-distance calls every month, all you have to do is call the operator and tell her you want to charge the call to your office. The call goes through and they very rarely check. Their bill at the end of the month is so big they can’t possibly pick out the illegitimate calls. I used the number of a large stationery company that has 20 or 25 salesmen calling all over the country trying to hustle paper and paper clips and that stuff.

I saved the best for last—automobiles. This is a little complicated, students, so read carefully. I normally get myself a car every two years or so, a late-model, low-mileage, upper-priced job. What you need to carry out this racket is phony identification, a phony license, a phony job and the cooperation of the credit manager of the place you’re buying the car. You also have to know the difference between a registration state and a title state.

In a registration state, like New York, the person who actually has possession of the car is named on the registration. In a title state, like Pennsylvania, whoever is listed as owning the car actually owns it. You make a down payment for the car, usually about $500, and that’s all it will end up costing you.

After I buy the car under my phony name and have my phony identification on both the registration and the ownership, I simply drive the car to a title state like Pennsylvania and register the car there under the same phony name. The registration form asks, “Do you owe any money on this car?” and I answer no. Now, the secretary of state, who authorizes the title, states on the bottom of the paper that he certifies that a reasonable search has been made to make sure the facts are true. Bullshit. The paper comes in and they stamp it and ship it back. Now I have the car registered in Pennsylvania under my phony name, and I have free and clear title.

On the front of the same title paper it asks, “Has this car got any encumbrances?” If there aren’t any listed, and there never are, you can sell that car anywhere and to anybody you want to. You can also sell it back to yourself, this time using your real name. Now you’ve got a car worth $3500 and it cost you $500. You can sell it to someone else for $3000 and make a $2500 profit for a few days work, or you can keep it yourself. I get my cars this way and I own them free and clear. If the car dealer has a beef let him go find the guy he sold the car to. And if he does, which we can rest assured he won’t, all he can do is sue. No one can repossess this car from me, even if they find it, because I own it. If anyone ever tried to grab that car from me I’d have him arrested for theft. There isn’t a cop in the world who wouldn’t have to recognize my title as the legal ownership of that car.

Cars, trips, clothes, liquor, perfume—like the man said, the best things in life are free. But sometimes you gotta give the tree a little shake. The fruit don’t just fall in your lap.