Part 36

When the President Lincoln arrived in Shanghai, Sam Gross was waiting at the pier to meet them. He introduced them to his two Greek companions and then took them to the Metropole Hotel, where he had made reservations for them. Sam said, “Now you two get a good rest. Everything is going all right.”

As Schisoff told the story later: “A few days later, Sam Gross tells me that he is going away for a week. He said to us, ‘Don’t walk too often in the street because it is not so good.’ I said, ‘All right. But what will I do if anything happens? Maybe I’ll get sick. I don’t know anybody around here.’ So he gave me an address. In case anything went wrong I should call that telephone number. I don’t remember the address and the number. It was a Greek fellow, named Jay, and his wife. Finally Sammy Gross puts a scare into me and tells me not to go into the streets.

“And so we stayed in the hotel until we got blue in the face. And so my wife finally says, ‘We have money. Why sit in the hotel? I want to do some shopping. Everything is so cheap here.’

“So we were sitting there about three days and then I called that number that Sam gives me and the wife answered. I told her about us. She answered, ‘All right, I’m going to send my chauffeur to bring you over....’ She treated us to a meal and we spent the afternoon there and then went home.

“Gross finally returned and said, ‘Listen, the ship is going to be here in a day or two. I’ll have two trunks for you to take with you. You don’t have to do anything. We will put the trunks on board for you and I will show you what to do when you are on the boat. You forget about the trunks. When you are about three days out of Marseilles, go to the purser and say that you want to have the trunks shipped across France to Cherbourg in transit. Then when you get to Marseilles, there’ll be somebody waiting for you to take care of everything. That way they don’t have to open the trunks when they go through France.’”

The Schisoffs had a gay Christmas party at the home of the Greeks, and four days later they boarded their ship and sailed from Shanghai. They were met in Marseilles by one of Lepke’s henchmen, who handled the trans-shipment of the trunks. Then the Schisoffs left the ship at Marseilles and went by train to Cherbourg to catch the SS Majestic for New York.

Lepke’s man told them, “Don’t put those two trunks on your baggage declaration.”

Schisoff said, “How am I going to do it then?”

The hoodlum said, “You’ve got eight pieces of luggage of your own. You put down everything on the declaration that you bought but leave these two trunks out. They will be taken care of. Don’t you worry about that.”

Schisoff replied, “All right. Whatever you say is all right with me.”

On the night of February 4, 1936, the night before the Majestic was to dock in New York, Jake Lvovsky and Jack Katzenberg registered at the Luxor Hotel in New York. A short time after they went to their rooms they were joined by two Customs guards, John McAdams and Al Hoffman. It was agreed that Lvovsky would meet McAdams and Hoffman at the pier the next morning before the Majestic docked and they would turn over to him the stickers to be placed on the trunks brought in by the Schisoffs. The stickers were issued to the guards each morning and a new color was used each day. For that reason the delivery of the stickers had to be made at the pier.

Lvovsky arrived at the pier as the Majestic was docking. He stopped and chatted casually with McAdams, who slipped him the stickers. When the baggage was unloaded, the Schisoffs’ trunks were sent to the section marked with the initial “S.” Schisoff pointed out the two trunks to Lvovsky, who walked over casually and sat down on a trunk to smoke a cigarette, as though waiting for an inspector to check the luggage. Unobtrusively he took one of the stickers and pasted it to the trunk. He moved to the other trunk, sat down, and pasted a sticker on that trunk. And then he strolled away.

A Customs inspector examined the Schisoffs’ suitcases, but he noted the trunks already had the inspection stickers on them so he permitted them to be carted off. They were loaded into taxis by Lvovsky and Katzenberg and hustled off to an unknown destination.

The system worked like a charm. Each time that Lvovsky notified the two Customs guards of an arrival of a “world traveller” the guards would arrange to be on duty at those hours so that they could obtain stickers and pass them on to Lvovsky. Six times the confederates of the gang made the trip safely from Shanghai without any inspection of the heroin-loaded trunks.

But Treasury agents were closing in on the gang. Narcotics agents, with aid from Customs agents, had opened an investigation of Lepke’s narcotics smuggling ring after an informant had squealed to Narcotics Commissioner Harry Anslinger. The informant--whose name has never been disclosed--was a woman with revenge in her heart. Her boy friend--one of the Lepke mob--had been playing around with another woman and she wanted to get even with him for his infidelity. She gave Anslinger enough information, with facts that could be verified, to start the ball rolling. Bit by bit, the agents closed in on the gangsters. And they discovered by a close check of the stickers issued to all pier personnel that there was an irregularity in the stickers which had been issued to the guards McAdams and Hoffman.

As the agents began to put on the heat, underworld characters started to talk. Those “world travellers” who had helped bring narcotics into the country began to confess. Evidence mounted against the gang, and when the crackdown finally came, a total of thirty-one persons were involved. Lepke was indicted on ten counts of a conspiracy to smuggle narcotics into the United States.

At this time--December, 1937--Lepke was a fugitive. A little more than a year earlier he and Gurrah Jake Shapiro had been convicted on the antitrust charges brought against them four years earlier. They had been sentenced to two years in prison and fined $10,000. But Lepke appealed. He was released under $3,000 bail and immediately went into hiding.

For almost two years Lepke’s pals hid him from the law. He lived for a time in the old Oriental Dance Hall on Coney Island. Then, twenty pounds heavier and wearing a mustache, he moved to a flat in Brooklyn. Later he occupied a house in Flatbush, posing as the paralyzed husband of a Mrs. Walker. All this time he continued directing the affairs of his criminal organization.

But now, in 1939, the search for Lepke had become the most intense manhunt the country had seen in years. The Federal government wanted him on the narcotics charges growing out of his syndicate operations. And he was the No. 1 man on the most-wanted list of New York’s District Attorney Thomas E. Dewey, who then was opening his first bid for the Republican Presidential nomination. Among other things, Dewey was certain he could pin a murder charge on Lepke--who now had “dead or alive” rewards on his head totalling $50,000.

As the pressures mounted, the hunted man became desperate. And desperately he tried to wreck the cases against him by sending witnesses out of the state, by intimidation, and by murder. The heat was on the underworld as it had never been before. The rumor spread that if Lepke did not surrender to the authorities, he would be killed by one of his own kind. Lepke had at last become too much of a liability even to his old pals.

Hunted and frightened, with every day holding the threat of sudden death, Lepke began negotiations to surrender to New York Columnist Walter Winchell--on the condition that he would be turned over to the FBI rather than New York State authorities.

During the evening of August 5, Winchell received a telephone call from a man who refused to identify himself. “Lepke wants to come in,” he said. “But he’s heard so many different stories about what will happen to him. He can’t trust anybody, he says. If he can find someone he can trust, he will give himself up to that person. The talk around town is that Lepke would be shot while supposedly escaping.”

Winchell called FBI Director John Edgar Hoover in Washington and told him of the mysterious call and Lepke’s willingness to surrender if he could be assured of protection.

Hoover told Winchell: “You are authorized to state that the FBI will guarantee it.”

For almost three weeks the dickering continued between Winchell and his mysterious callers until Hoover finally said, “This is a lot of bunk, Walter. You are being made a fool of, and so are we. If you contact those people again, tell them the time limit is up! I will instruct my agents to shoot Lepke on sight.”

Winchell relayed this information to the intermediary. Then it was that arrangements were made for Hoover to be waiting in his automobile on 28th Street near Fifth Avenue at 10:15 on the evening of August 24.

Winchell was parked in his car at Madison Square when Lepke came out of the shadows and stepped into the car beside him. “Hello,” Lepke said. “Thanks very much.”

Quickly, the columnist drove to 28th Street, where he pulled up behind Hoover’s car. Lepke quickly moved into the automobile beside Hoover.