AMAN LIKE ARNOLD ROTHSTEIN, who provides immense amounts of cash for card and crap games, usurious loans, and bail bonds readily and profitably, is soon approached for even less reputable propositions. Eventually Broadway asked Rothstein to finance bootlegging and speakeasies and drug running. But before that it wanted cash-or perhaps he volunteered it-for a lucrative traffic in stolen goods. A. R. fenced jewelry and furs, but the big money was in stolen war bonds.
America financed its participation in World War I by raising taxes dramatically (including the hitherto modest income tax) and by heavy borrowing. The Treasury Department employed Hollywood stars Al Jolson, Mary Pickford, Douglas Fairbanks, and Charlie Chaplin to entice citizens into purchasing billions in Liberty Bonds. In the fourth Liberty Bond drive alone, half of America's adult population subscribed. However, the government ignored bondholder safety. Liberty Bonds were bearer bonds, redeemable by whoever got their hands on them.
Arnold Rothstein and Nicky Arnstein got their hands on $5 million worth.
Charming, dapper, 6'6" Jules W. "Nicky" Arnstein (alias Nick Arnold; alias Nicholas Arnold; alias Wallace Ames; alias John Adams; alias J. Willard Adair) was the husband of musical comedy star, the 5'7" Fanny Brice. When Fanny sang her heart-wrenching "My Man" in the 1921 edition of Flo Ziegfeld's Follies, she emoted about her troubles with Nicky-and all America knew it.
Nicky didn't rob with a gun. He used his wits, and made victims befriend him while fleecing them at cards or confidence games. Like Arnold Rothstein, Arnstein came from good stock. Like Carolyn Rothstein, he came from mixed stock. Nicky's father, Berlin-born Jew Moses Arndstein, fought with distinction in the Franco-Prussian War. His mother, Thekla Van Shaw, was Dutch, and they raised Nicky as an Episcopalian. "No boy could have been brought up with more love and care than was I," he recalled, "and I always have loved the beautiful things of life-beautiful pictures, good books, and birds and flowers. My fondness for gambling, however, led me to live a life rather apart from my family. It is one of the penalties I have paid for my fondness for the cards, the dice, and the horses."
"Nicky" was short for nickel plate, a sobriquet bestowed in the 1890s, when Arnstein raced a gleaming nickel-plated bicycle, in the then-popular bike racing craze. However, he spent more time throwing races than winning them. Before long he fell in with the legendary Gondorf brothers, Fred and Charley, master con-men who specialized in fleecing rich suckers in elegant settings. Arnstein graduated to gambling on transatlantic liners and in European casinos, eventually being arrested in all the best places: London, Brussels, Monte Carlo.
By 1912, he met Arnold Rothstein. "I knew him," Arnstein gushed in admiration, "not only as the king of the gamblers, but as the whitest [most honorable] of them all! ...
"He was interested in everything involving chance, to the point of a passion. Racing thrilled him ... He never gave one a wrong tip in his life."
After A. R.'s death, when others uniformly derided him as a cheat and welsher, Arnstein held firm:
What an exceptional man! Can you picture or imagine a gambler with higher instincts? [He was] a real man and a human gentleman to the fingertips. I termed him a gambler. I guess he would not have denied it, but he was a shrewd businessman as well.
I know that much will be said about him now that will not be pleasant with his memory. But to me he was an honest man, with an outstanding integrity. He had daredevil courage.
I have seen him lose a cool half million dollars in one night, a fortune that would dwarf any of them at Monte Carlo. Rothstein lost this money one night without batting an eyelash, without flinching or showing any signs of being disturbed....
I know that he earned millions as a builder, in the insurance business and with a stable ... of the finest race horses in the country. He was one of the most tireless workers I have ever known, for sixteen hours at work when I knew him was his average day. And in those sixteen hours he helped many people. I do not believe he ever said "No" to a friend.
Either in Baltimore in 1912-or London in 1913-Arnstein met Brooklyn-born Fanny Brice, star comedienne of the Ziegfeld Follies. Both were married, but fell in love instantly. Fanny willingly supported her new man, but he refused to abandon confidence scams. In 1915 he was convicted of wire fraud. Fanny financed months of unsuccessful appeals, but in March 1916 Arnstein found himself in Sing Sing. Again, she did whatever she could, pawning much of her jewelry to guarantee Arnstein proper treatment: the easiest prison job, the best cuisine. In June 1917 she secured Nicky's pardon from Governor Charles Whitman. Customarily, pardoned prisoners waited until morning for freedom. Sing Sing's warden escorted Arnstein to the prison gates that very evening.
In 1918 Nicky finally divorced the first Mrs. Arnstein. That October he became Mr. Fanny Brice. Arnstein hobnobbed with her show-business friends, including Eddie Cantor and W. C. Fields, and inspired Fields's catch phrase "Never give a sucker an even break." By 1918 Fanny was earning $2,500 a week. The couple enjoyed a Central Park West town house and a Long Island country home, but Nicky still had larceny in his heart. Starting in 1918, a series of bond robberies rocked Manhattan. Bandits stole $5 million in bonds from Wall Street couriers who more often than not had prearranged to be robbed. Police remained baffled until February 2, 1920, when they nabbed a group of gunmen and messengers in the act. Normally bail would be posted, and a lawyer assigned. The thieves would serve a minimal sentence and maintain a discreet silence regarding higher-ups.
But nobody arrived at the Tombs this time. No bail bondsmen, no lawyers. Joseph Gluck, the leader of the crooked messengers, confessed and identified the mastermind behind the operation as a "Mr. Arnold."
Assistant District Attorney John T. Dooling gleefully assumed he finally had Arnold Rothstein, but Gluck examined Rothstein's photo and said this was not the "Mr. Arnold" he knew. Finally Dooling showed Gluck a picture of a dapper, long-faced man with a waxed mustache. That's "Mr. Arnold," said Gluck.
It was Nicky Arnstein.
"Nicky? My Nicky?" Fanny Brice exclaimed to detectives. "Nicky Arnstein couldn't mastermind an electric light bulb into a socket!" But her Nicky had controlled the entire operation-or, at least, controlled it to the point of fencing the stolen bonds. For fencing such huge amounts, he needed the Great Bankroll. A. R. obliged: for twenty cents on the dollar.
On February 12, 1920, Nicky Arnstein dressed glumly in a shabby outfit and headed for Harlem's 125th New York Central Railroad station to catch the first train out of town. He left no forwarding address, not even to Mrs. Arnstein.
Arnstein soon decided he needed more than a hideout; he needed legal representation, of the sort Arnold Rothstein often employed. Within days, a call was made to the firm of Fallon and McGee.
William Joseph Fallon, "The Great Mouthpiece," bears further introduction, for his spectacularly scandalous career and Arnold Rothstein's intersect regularly. In the 1920s New York possessed its share of spectacular defense attorneys-Arthur Garfield Hays, Bourke Cochran, Max Steuer, Dudley Field Malone-but if you were incontrovertibly guilty of a particularly heinous crime, you thought first of Bill Fallon.
Genius and nerve marked Fallon. No one was better in a court room, thinking on his feet, citing relevant-or, upon close examination, irrelevant-precedents. No one was better at improperly injecting ideas into a jury's minds. Were his comments overruled by the judge and stricken from the record? Of course, but the damage had been done. Juries still heard Slippery Bill's inadmissible, improper, and often unsubstantiated comments-and couldn't help but give them credence. No attorney exhibited more daring in goading judges mercilessly-if it served his clients. And if all that failed, no member of the bar could more skillfully cause incriminating documents or witnesses to simply vanish. And no one tendered bribes more smoothly to amenable jurors.
Fallon was born just off Times Square, on West 47th Street, half a block from Broadway. He first earned his living quietly and respectably as an assistant district attorney in suburban Westchester County. But around 1918, something within him snapped. Fallon claimed he had wrongly convicted a man and couldn't live with his shame. But that wasn't it. Maybe it was drink, though it took him a few more years to become a roaring drunk. Or maybe Bill Fallon simply realized that there was more money and glamour defending crooks on Broadway than prosecuting them in White Plains.
Two early cases, both containing healthy doses of sex, guaranteed Fallon's reputation. In early 1919, he defended former actress Mrs. Betty Inch, a blackmailer caught red-handed accepting hush money. Fallon positioned Mrs. Inch on the witness stand to expose her wellturned ankles. She won a mistrial. For her second trial, Fallon secretly built a high wooden fence around the witness box-then blamed prosecutors for its construction, charging that it spitefully meant to block sight of his client's shapely legs. "This hurts," he fulminated. "The insult of it! The shame! That civilization permits men to treat a beautiful, frail woman in this manner shows to what depths we have sunk since the age of chivalry. I have half a mind not to go on with this case!"
He did. The jury deadlocked again. It was the prosecution that gave up.
The following year The Great Mouthpiece defended twenty-eight year-old Ernest Fritz, a married cabdriver accused of brutally causing the death of twenty-four-year-old girlfriend, Florence Coyne, during a savagely wild petting session in his taxi. Fallon did everything from having the prosecution's star professional gynecological witness reverse himself and appear as a defense witness to sneaking Fritz's actual taxicab into the courtroom-and then not mentioning its rather large presence (a rather large and expensive mind game)-to calling the dead woman's cuckolded husband as a defense witness. On March 9, 1920, a jury needed just three hours and thirty minutes to find Ernest Fritz not guilty.
Fallon made little money defending cabdrivers or penny-ante blackmailers. Money could be made defending New York City's increasingly prosperous underworld. Fallon found Arnold Rothstein a steady and well-paying customer. After all, A. R. led a life full of precarious legal troubles, from shooting cops to fixing a World Series. A man like Bill Fallon could prove very handy.
On one level, the Big Bankroll and the Great Mouthpiece were a good team. In a world of boorish plug-uglies and musclemen, Rothstein and Fallon exhibited intelligence, wit, and daring. In their seamy worlds, they were the class of the field, but their relationship contained the seeds of major conflict: The Big Ego vs. The Great Ego.
Each tolerated the other, conceding his skills and achievements, but not liking, loving, or particularly admiring him. Fallon's ego actually outpointed Rothstein's. He scorned Arnold, goaded him, mocked him to his face.
Rothstein neither smoked nor drank, but worried constantly about his health, especially his digestion. No underworld figure ever drank more milk than Arnold Rothstein. Nor did anyone ever eat more figs. Arnold considered figs essential to his continued wellbeing, carrying a bag around with him, and replenishing his supply from an all-night fruit stand on his way home each evening.
Always knowing a man's weakness, Fallon probed at A. R.'s. One night he casually inquired as to whether Rothstein felt well, meaning to goad him into a rage. Of course he did, Rothstein responded. Why was Fallon asking?
"Aren't you eating too many sandwiches?" Fallon inquired solicitously.
"What are you getting at?" A. R. wanted to know.
"Don't you think you should go to Atlantic City [for a rest]?" The Great Mouthpiece suggested.
"I never felt better in my life."
"That just goes to show how appearances can deceive. Are you sure your stomach isn't upset?"
Rothstein grew angry-and defensive. Maybe, Fallon might be on to something. "I know it isn't," he cut him off.
"Then it must be your gallbladder."
"There's nothing wrong with me," A. R. fumed.
"Is that what the doctor told you?"
"Hell no! I haven't been to the doctor. There's nothing wrong."
"Is that what the doctor told you?"
A. R. could only repeat: "Hell no! I haven't been to the doctor. There's nothing wrong."
"I hope you're right." Fallon rose to leave.
"What's your hurry?"
"No hurry, only I'm not going to tax the strength of a sick man."
"Who says I'm sick?"
"You say you're not," Fallon said, conceding the point-after having done his damage. "Certainly you should know."
Their animosity degenerated into petty remarks about the other's looks. One day Fallon commented to associates: "A. R. has mouse's eyes," a remark that infuriated Rothstein, since even meaningless remarks will infuriate those ready to be outraged. A. R. responded by repeating old rumors that Fallon cut his own hair-he had a magnificent red pompadour, but a reputation for being cheap about certain things-and then embellished it by speculating that he also colored it himself. When this reached Fallon (as Arnold knew it would), he retorted: "Did you ever see a mouse that had false teeth?"
To his associates Fallon continued on his mouse theme, jibing "Rothstein is a man who dwells in doorways. A mouse standing in a doorway, waiting for his cheese."
Rothstein returned the animosity. A. R. employed numerous attorneys, but only Bill Fallon never was engaged to draw up or execute his will. "I can't trust a drunk," he told Fallon to his face on more than one occasion.
In 1920 Nicky Arnstein had to trust Bill Fallon. Nicky realized he couldn't hide forever. Being on the lam was akin to sentencing yourself to prison. He resolved to stand trial and, with Bill Fallon representing him, he stood an excellent chance of freedom. However, he did not wish to await trial behind bars. If he surrendered, he'd need bail money-in a $5 million case, a lot of it.
Fanny Brice's finances were at a low point. She couldn't provide bail, nor were her friends willing to assist her, but Bill Fallon knew A. R. would. Rothstein would collect not only a handsome rate of interest from the Arnsteins, he'd earn something far more valuable: Nicky's silence. Nicky Arnstein knew the rules of the underworld. If A. R. assisted him, he could never testify against him.
Brice and Fallon met Rothstein at the New Amsterdam Roof, where she appeared nightly in Flo Ziegfeld's Midnight Frolics. "I'd be glad to take care of that matter for you, Miss Brice," Rothstein said agreeably.
As usual, something in A. R.'s manner annoyed Fallon. "You needn't put yourself out, A. R.," he interjected. "It's all taken care of."
Rothstein knew better. He also knew it was in his own interest to supply the money in question: "I happen to know that it isn't. What do you think of that?"
"I could be arrested for what I think," Slippery Bill snarled.
"That might be possible, too."
"But it isn't probable."
A. R. wasn't getting anywhere trading insults with the Great Mouthpiece, so he returned to the business at hand, bail for Nicky Arnstein, demanding an answer from Fallon in twenty-four hours. He warned-no, he threatened-that Nicky had been "spotted, and may be brought in at any time."
Brice told Fallon to stop his games and accept A. R.'s offer. Rothstein promised $100,000-in Liberty Bonds. Still Fallon couldn't help needling A. R.: "Bet you'll cut the coupons yourself, I suppose."
"Yes," A. R. replied, gritting his pearly white false teeth, "inasmuch as the bonds belong to me, I suppose I'll tend to little things like the coupons."
Fallon arranged for Nicky to surrender himself. Arnstein drove from his Pittsburgh hideout-his car breaking down in both Syracuse and Albany-to Mamaroneck, just north of Manhattan. There, Arnstein (sans waxed mustache) rendezvoused with Fallon (hungover, with collar soiled and face unshaven) and drove to Amsterdam Avenue and West 96th Street, where Fanny joined them. Meanwhile, Rothstein alerted Herbert Bayard Swope to Arnstein's arrival, so Swope's New York World might enjoy an exclusive story. Swope assigned reporter Donald Henderson Clarke to escort the trio downtown. However, Clarke got roaring drunk and missed the trip. World reporter George Boothby replaced him.
It was Saturday, May 15, 1920, the morning of Gotham's annual police parade. Thousands of New York's Finest marched down Fifth Avenue, and somewhere en route, a blue Cadillac landaulet chauffeured by Fallon and carrying World reporter Boothby and Mr. and Mrs. Arnstein joined them. As their car passed the official reviewing stand, Arnstein arose to doff his gray cap to Mayor John E "Red Mike" Hylan and Police Commissioner Richard Enright. Fallon and Brice restrained him.
Arnstein's grand gesture was not entirely spontaneous or coincidental. In fact, he had previously written to Commissioner Enright requesting two tickets for the reviewing stand. Enright assumed it was a hoax.
Reaching District Attorney Swann's office, Arnstein surrendered, but complications ensued. Swann had promised Fallon that Nicky would be released on $60,000 bond, but now Assistant District Attorney Dooling asked judge Thomas C. T. Crain to set bail at $100,000. Crain split the difference at $75,000. Fallon groveled before A. R. for the additional $15,000, but he got it.
That liberated Arnstein from state clutches, but authorities now bound him over to federal bankruptcy court, which demanded an additional $25,000 bond, something no one had counted upon. Nicky, who dreaded spending a single night in the Tombs, now found himself in the stinking old Ludlow Street jail.
Meanwhile new troubles visited his wife. While Nicky sat incarcerated, Fanny waited at a nearby cafe, nervously amusing Bill Fallon, Harold Norris of the National Surety Company, and the World's Donald Henderson Clarke (sufficiently sober to finally join the group). At some point, someone noticed that Miss Brice's new Cadillac landaulet had disappeared-stolen. Inside the cafe was Michael Delagi, Big Tom Foley's attorney. Fallon and Norris knew if anything crooked happened in that neighborhood, Delagi was somehow responsible. They rushed at him, berating him frantically. Delagi told them to go to hell.
Henderson remembered the magic word: "Rothstein." "Look here," he informed Delagi. "Go ahead and be mad at Fallon and Norris. That was not their car that was stolen. The car belongs to Nicky Arnstein. Nicky is a member of your club in good standing-if being charged with being the `master mind' in a $5,000,000 haul counts for anything in your set-and he is being bailed by Arnold Rothstein. You knew that, didn't you-Arnold Rothstein. And, besides, Fanny Brice has had enough trouble. Listen to her crying back there."
"A. R. is on the bail?" replied a suddenly chastened Delagi. "Well, I don't mind telling you a mistake was made. The guys that took that car didn't know who it belonged to, see? They thought it was just one of those cars. And they'll be getting busy in about five minutes changing it so its own mother wouldn't recognize it. That is, maybe they will. Wait a minute."
Delagi phoned a Lower East Side garage, where Miss Brice's car was about to undergo considerable cosmetic surgery. He had called in time. It would be returned untouched.
A few minutes later, Brice's vehicle arrived, accompanied by Monk Eastman and three of his associates. Eastman apologized profusely. "We're sorry this happened," he told Bill Fallon. "We didn't know to whom the car belonged." Then, as starstruck as any schoolboy-but considerably dumber-he asked to meet Fanny Brice: "Will you introduce us to the lady?"
"Introduce you blankety-blank blanks to a lady!" Fallon stammered. "I should say not."
Fanny had her car, but still needed additional bail for her husband. As collateral for Nicky's local bail, she had already provided Rothstein with rights to her town house and country home; to the royalties for several songs; to her 72nd Street dressmaking business, Lottie and Brice; and a lien upon her salary. Now he asked for more. The Tribune recorded his new price:
To ensure Arnstein's appearance in the bankruptcy proceedings against him, Fanny had to part with the possessions that are most precious to an actress-her jewels. So the hands that the slender Jewess extended to Nicky yesterday when he finally was released were bare of all ornaments, except a platinum band, her wedding ring.
Before Swann's office could try Arnstein, however, authorities brought him to Washington, D.C. to face trial on federal charges. One night, Arnstein and Fallon attended Washington's Keith-Albee vaudeville house, where Nicky introduced the Great Mouthpiece to performer Miss Gertrude Vanderbilt. Fallon had a wife back home, but they had been drifting apart for some time. He already had his flings and would have more, but Gertrude Vanderbilt was as close to the real thing as a man like Bill Fallon, living in an increasingly tinsel world, would know.
Federal authorities wanted answers from Arnstein about the Liberty Bonds. Fallon instructed Nicky not to answer 447 of their questions, on grounds that "to do so might tend to incriminate or degrade" him. Federal authorities contended that, as a bankrupt, Arnstein had forfeited that right. In Arndstein v. McCarthy, the United States Supreme Court said he didn't.
When Arnstein went to trial in the District of Columbia, Fallon brought in yet another hung jury. Mr. and Mrs. Arnstein appreciatively named their firstborn son in the Great Mouthpiece's honor, and Nicky presented him with a ruby-and-platinum ring as a token of affection and gratitude. But federal authorities opted for another trial, and soon attorney and client had a major falling-out. Nicky grew edgy over his counsel's unorthodox work habits, particularly alarmed by time spent with Gertrude Vanderbilt. Arnstein's patience snapped when he learned that Fallon had given his ruby ring to Gertie-and she had immediately lost it in a taxicab.
Nicky unleashed an unbridled tirade against Gertie Vanderbilt and against his attorney's diligence, concluding with the accusation that Fallon should have delivered an acquittal, not a mistrial. Infuriated, Fallon shot back. "Look here. You don't know a thing about law, and less about morals. You were lucky to get off as well as you did. If you don't like it, you can get another attorney."
They continued on in this vein until Arnstein yelled. "To hell with you and her! If you want to bitch up your life, go ahead. But I'm damned if you'll bitch mine up. I don't mind how much you drink or chase around, but when you go off your nut about this woman, how in hell-"
And with that, Bill Fallon walked off the case.
He abandoned Nicky's defense to his now-former partner, Eugene McGee (McGee broke up the firm when Fallon jettisoned Arnstein.) In Arnstein's second trial, McGee faced William Lahey, the District of Columbia's toughest federal prosecutor, and never being much of a courtroom presence, McGee found himself overmatched. Swallowing his pride, he called Fallon for advice: Should Nicky take the stand? The Great Mouthpiece said no, and McGee listened. It was bad advice. The jury brought in a verdict of guilty. "Fallon did this to me," Arnstein muttered. "Fallon sent me into this. Goddamn that woman! "
Star prosecution witness Joe Gluck had sworn he received no promises of immunity. Yet, he and his brother Irving, another defendant, received suspended sentences. The news outraged presiding Judge Gould, and might well have caused him to free the accused had it not outraged him so much so that on May 20, 1921-the day of Nicky Arnstein's sentencing-he dropped dead of a heart attack.
Gould's replacement, judge Frederick L. Siddons, sentenced Arnstein to two years in Leavenworth. Many believed that had Arnstein taken the stand in his own defense, Siddons would have extended mercy to him. Nicky Arnstein spoke more truth than he knew when fumed: "Fallon did this to me."
Arnstein also faced charges in Manhattan, and Assistant District Attorney John T. Dooling looked forward to bringing them to court: "The real story of the big bond robbery has never really been told, but when Arnstein and his crowd are tried in New York it will be known. There are more ends to this conspiracy and robbery than any one unfamiliar with it imagines."
The "real story," of course, led to Arnold Rothstein. However, neither John Dooling nor any member of the district attorney's staff would ever present it to any jury.
Dooling had difficulties of his own. Tammany Hall had difficulties of its own. Tammany overlord Charles E Murphy and West Harlem district leader Jimmy Hines detested each other. After Murphy tried and failed to oust Hines from his district position, Hines (assisted by his attorney Joseph E Shalleck, a Fallon protege) retaliated, using his considerable influence within the judicial system to wrest control of a sitting grand jury. The Almirall grand jury (so called after foreman, Raymond E Almirall) was originally empaneled to probe postwar radicalism. Instead it turned into the ultimate runaway grand jury, investigating not only Charlie Murphy, but also the district attorney's office itself, specifically Dooling and fellow Assistant District Attorney James E. Smith. Charges of corruption against Dooling were dropped eventually-but he paid a price for peering too closely into Arnold Rothstein's business-paid a price and learned a lesson.