Saturday, December 29, 2018

Detroit's Numbers Racket

Today's state run lotteries are first cousins to the illegal policy rackets of the early twentieth century--known by players as the numbers game. Curious how things once illegal become legal when the government gets involved. The grass-roots game had much better odds but much lower payouts than today's state-run lotteries. To win, a player needed to match only three numbers rather than the six or seven used today with astronomical odds against winning. Then as now, some of the most avid players were the people who could least afford it.

Beginning in the 1920s, the Purple Gang-controlled numbers game in Detroit was a profitable money machine for the Bernstein Brothers and their associates who were many. Numbers runners, bag men, and accountants kept the money flowing. There was a fortune to be made from the pennies, nickels, dimes, quarters, and dollars of working-class immigrants--particularly Italians, Jews, and the Irish. Members of Detroit's black community developed into major players in the innercity numbers racket where the game was popular.

Many people made tax-free extra bucks running numbers. Seemed like everybody had a favorite number or several numbers they played daily if they had some small change. Playing was convenient, bets could be taken over the phone. People could also place more costly combination bets of any permutation of their three numbers. For example, 127 could win with 127, 172, 217, 271, 712, and 721. Every place where liquor or soda pop was consumed became a numbers drop. Every grocery store, barber shop, beauty shop, candy store, and virtually every business within a runners assigned territory was a potential numbers drop. The more money a numbers runner collected, the more money he or she made. 

The numbers game appealed to people who were not habitues of the “high-class” gambling establishments of Detroit’s high rollers, social climbers, and underworld figures that mingled nightly with unsettling familiarity. The urge to gamble was not limited to the well-heeled public and wealthy industrialists. Everyday people wanted to place bets. If they couldn’t afford to chase Dame Fortune, they were content to wink at Lady Luck.

Spare change and small bills made up the bulk of the daily take. The game was easy to play—pick three numbers ranging from 000 to 999 and wait for the daily winning number. Players placed bets with a numbers runner who collected the money and recorded the bets in a handbook with the bettor’s name and date written in. A receipt with a serial number printed at the bottom was given to the bettor to prove he or she placed the bet in the event they won. A more sophisticated version of the game we known as Keno had greater payouts but greater odds.

The odds for the basic game were one in a thousand. If you were the only person to hit that number that day, your payoff could be 600 to 1, otherwise the jackpot was split among the winners. Bagmen collected the money from the runners and took it to a central location called a numbers bank where a group of accountants processed the bets, counted the money, and passed it on to a central drop at a secret location.

At first, the numbers were drawn from numbered balls in a ball cage or three spins of a wheel of fortune. These methods could be manipulated and soon fell out of favor. Players wanted three numbers that were certified random. Bernstein’s game used the last three numbers of the United States Treasury Department balance which was printed daily in the business section of newspapers. When the Treasury Department began to round off their numbers—so they wouldn’t be a party to illegal gambling schemes—the three last digits of the number of shares traded on the New York Stock Exchange became the daily winning number. That number was found conveniently in the daily papers. Choosing today's lotto number picks have gone back to the numbered-ball drops which are televised to prevent fraud.

Accounting books seized by treasury agents in a 1940 raid of a Paradise Valley numbers drop revealed as many as 6,000 men and women were employed by Detroit numbers operators. The average payout was 16% of the take divided among the winners. The number runners who took the bets filled out the betting slips and got 25% of their daily take. The bagmen who collected the money and betting slips from the bookies took them to a secret central location. They made 10% of what they brought in. Finally, the promoters took 49% for themselves and their overhead. All of those accountants needed to be paid—not to mention the occasional bail bondsman.

Because of the large territories where the game was played, the profits were huge. But this scheme was not without its dark side. Anyone skimming money off the top, holding out on winners, compromising the operation, or attracting unwanted attention from the authorities would be quickly eliminated.

Link to the wine brick racket;postID=2979020335839039617;onPublishedMenu=postsstats;onClosedMenu=postsstats;postNum=5;src=postname

Friday, December 14, 2018

The Elusive Purple Gang

Purple Gang lineup in 13th Precinct--the Canfield Street station.

Since May 2018, I've been researching Detroit's Prohibition-era kingpins--the Purple Gang--for an untitled book I'm writing. As helpful as the Midtown Detroit Public Library Burton Historical Collection and the Walter Reuther Library were to my early research, a couple of trips to the Windsor, Ontario Library, Biblioasis bookstore, and landmarks where the liquor trade flourished were information-rich finds. Seems like the Canadians have done a better job documenting their Prohibition history than Americans have.

One thing I've learned is that Al Capone had more to do with smuggling on both sides of the international border than most people realize. He was the larger than life figure who defined the Big City gang boss. Capone ruled from Chicago and his organization financed affiliates in Detroit, St. Louis, Kansas City, and Cleveland.

Rather than muscle in on the Purple Gang's Detroit territory, Capone cut a fat deal with the gang to take all the uncut liquor they could hijack or smuggle across the Detroit River. The Purples were not the only gang in the liquor acquisition business. They competed with the Italian Dago Mob to the east and the Italian Moustache Pete's to the west for control of the illegal booze business. The Jewish Purple Gang worked with anybody who could help them make money. They worked with members of both gangs and acted as a buffer between them until the 1931s.

Some background reading.
In addition to reading books on the various aspects of the liquor trade and scouring the Internet for information, my most fertile area for details on the gang is coming from The site carries Detroit Free Press archives dating to the nineteenth-century. Patient navigating brings up the original headlines and articles. The gang's bloody history reported on by the yellow press of the time is well-known--their arrest records, acquittals, convictions, murders, and assaults. What isn't known is much about their personal lives.

Tommy's Bar 1928 Purple Gang roundup at the height of their power.

I'm struggling to find out some factual information about gang members families. Obtaining death certificates should be routine, but these are proving difficult to get. Purple Gang members I'd like to know more about are the Bernstein brothers Abe, Ray, Joe, and Isadore; the Keywells Harry and Phil; Harry Millman; Irving Milberg; Abe Axler and Eddie Fletcher. If any of these wise guys have relatives with some basic information, contact me at I want to portray them as accurately as possible.

Right now, I'm most interested in Joe Bernstein's wife. One source says she was Marguerite Ball--a dancer with the George White Follies based in Chicago. disputes this. She may be the Yoko Ono of this story. After her husband took a slug in the spleen in 1930, she gave him an ultimatum, "Either the gang or me." I know there is more to that story than is readily apparent.

The Purple Gang members were real people beyond the headlines but little documentation is available. I have two theories why so little personal information is available about these "well-known" underworld figures. The first and most obvious reason is they fiercely protected their wives and kids and kept them out of the public eye. Reporters who harassed or threatened the security of family members soon felt the wrath of a gang inspired beating. My other theory is that their Jewish families were ashamed and embarrassed by their hoodlum sons. Photos and other memorabilia must exist, but they are surely closely guarded family artifacts. After eighty years, it would be wonderful if some of that history were preserved and shared.

Tough street kids with a rifle.
Many immigrant children from Detroit's lower east side worked as hard as their parents to rise above poverty and squalor to become doctors, lawyers, teachers, nurses, rabbis, priests, policemen, firemen, and tradesmen. But others were too smart for that. These boys saw how tough life was for their struggling immigrant parents. They wanted to short-circuit the system and snatch the American Dream rather than work a real job. The Purple Gang developed into one of the most feared, wealthy, and successful crime organizations in the country. They were the only Jewish gang in the country who dominated a large American city. But in time, most of the gang members pushed their luck and ended up in either prison or the cemetery. By the mid-thirties--after a bloody Italian mob war--the Mafia consolidated and took over the Detroit underworld. The Purple Gang was finished as an organization.

I'm surprised how many Detroiters have never heard of the Purple Gang. There are some people who maintain there never was a Purple Gang--that they were only a media creation of the yellow press looking for headlines. Back in the day, whenever alleged Purples were questioned by police about the gang, their answer was always the same, "The Purple Gang? Never heard of them." One thing is for certain, every one of them broke their mother's heart.

The Las Vegas Mob Museum