The Mafia Files: Episode 4 Arnold Rothstein

“The J. P. Morgan of the underworld; its banker and master of strategy.”–Historian Leo Katcher on Arnold Rothstein

“Rothstein had the most remarkable brain. He understood business instinctively and I’m sure that if he had been a legitimate financier he would have been just as rich as he became with his gambling and the other rackets he ran.”–Meyer Lansky on Arnold Rothstein

January 17th, 1882: Arnold Rothstein is born in New York, New York. Unlike most other gangsters that grew up in the streets having to fight for survival, Rothstein was born into a comfortable life.

His father, Abraham Rothstein was a wealthy businessman known for his honesty & philanthropy. Known for his pious reputation, he was nicknamed by New York governor Al Smith as “Abe the Just” & served on New York’s Beth Israel Hospital as its chairman of the board. His eldest son even became a rabbi!

But Arnold was unlike the elder men in his family. At just three years old, he stabbed & nearly killed his older brother. He shunned away his parents over the years & was often scolded by his dad for shooting dice but nevertheless, refused to stop. Arnold eventually dropped out of school after acting upon a life-changing desire to finish his education on the streets in order to make a name for himself.

But despite his rebelliousness, his falling out with his parents, & repeatedly losing money due to gambling on the streets, Arnold had a knack for business that would work to his advantage later in life.

After going broke on several occasions, Rothstein quickly learned his place in the gambling world, stating: “If anyone was going to make money out of gambling he had better be on the right side of the fence. I was on the wrong end of the game.”

So in his late 20s, Arnold opened his very own gambling parlor. By 1912 at just 30 years old, he was already a millionaire thanks to his gambling parlor profits & racetracks. He was also known for his flawless winning streaks during card games or when betting, which many believe he won by fixing the events, including the horse races on his own tracks. One such infamous event was the 1919 World Series.

To this day, Arnold Rothstein is believed to have been responsible for the biggest scandal in the history of American sports. Baseball players back in 1919 considered themselves extremely underpaid, especially those of team owner Charles Comisky. As such, eight Chicago White Sox players, led by first baseman Chick Gandil, conspired to lose the World Series game against Cincinnati. In return, they’d be rewarded by a gambler willing to pay them for losing. That gambler was Arnold Rothstein.

During this time Rothstein hired former featherweight boxing champion Abe “The Little Hebrew” Attell as his personal bodyguard. Chick Gandil of the White Sox offered Attell an intentional loss to Cincinnati for payment of $100,000. Rothstein got word & arranged a deal through another intermediary to pay the players $80,000 for the loss. They agreed & Rothstein won a large amount of money by betting against the Chicago White Sox.

Thanks to his attention to detail & use of many middlemen in his transactions & dealings, the prosecutor had a very difficult time building a case against Rothstein. The judge, therefore, dismissed the case & let him off the hook.

The 1920s saw an influx of purchases from Rothstein including nightclubs, racehorses, & even brothels! He also held so much influence in the criminal underworld that he was apparently paid half a million dollars to act as an intermediary for a violent gang war. With an estimated net worth of $50 million, Rothstein became a high level loan shark known for throwing kickbacks at police officers & judges in order to evade the law. It’s rumored that he always carried around $200,000 in his pockets at all times.

Arnold Rothstein was unlike most gangsters. His usual attire of pinstriped suits made him look more like a banker than a mobster. He also found it more advantageous to buy cops & politicians rather than using brute force, which worked highly in his favor over the years. His wealth also allowed him to create a wide network of informants that sold him valuable information at a premium price no matter where the source came from.

But abstaining from violence did not mean Rothstein wasn’t careful. Although he was practically untouchable, he never slept in the same place twice nor did he follow a regular routine. Aside from using a checkbook or keeping significant amounts of money in bank accounts, he instead chose to spread his money across different apartments he owned all throughout the city.

Like many other gangsters during his time Rothstein benefited greatly from the prohibition. In fact, he was the one responsible for importing liquor into the U.S. at the start of the prohibition. He was highly revered not only due to the fact that he was able to smuggle alcohol into the States, but he also created job security within the criminal underworld.

It was only matter of time until Arnold Rothstein got involved with the mob due to his wide reach of power throughout New York City. He also had quite the eye for talent. Some of his henchmen included Dutch Schultz, “Legs” Diamond, Frank Costello, & the one and only “Lucky” Luciano, whom we discussed in episode 3. As a matter of fact, Luciano worshiped Rothstein, stating, “He taught me how to dress, how to use knives and forks and things like that at the dinner table. About holding a door open for a girl. If Arnold had lived a little longer, he could’ve made me pretty elegant.”–Charles “Lucky” Luciano

But the fortune & power came to an end by the late 1920s as his influence began dwindling significantly. The sharp businessman decided to diversify by branching into other seemingly promising & profitable areas such as racketeering & narcotics, which included both heroin & cocaine. Despite his untouchable status, Rothstein—like many others in the criminal world—became “disposable.”

Arnold Rothstein’s luck fell short in September of 1928 upon experiencing an unprecedented losing streak. During one particular poker game with Nate Raymond, George “Hump” McManus, & “Titanic” Thompson, Arnold lost $320,000 then refused to pay, claiming the game was rigged. Despite proof that the game was, in fact, fixed & verifying the truth behind his suspicions, Rothstein was nevertheless held accountable for his losses.

On November 4th, 1928, the poker game’s organizer, “Hump” McManus, summoned Arnold to his room at the Park Sheraton Hotel. At a quarter after ten, Rothstein was seen clutching his stomach while stumbling out of the hotel’s service elevator. He had suffered from a gunshot wound to the midsection. After making it only to the sidewalk, he collapsed. The police tried helping him by getting him to admit the names of those who shot him during brief lapses of consciousness, but Rothstein refused; vowing to get revenge on his own. But he never had the chance to & died two days later.

McManus was arrested for the murder & consequently put to trial. The evidence of his guilt was overwhelming, which included the story of a chambermaid who withdrew her claims of seeing McManus at the hotel the day of Rothstein’s death, despite McManus’s coat being found inside the hotel room. George “Hump” McManus was ultimately acquitted of Rothstein’s death & walked out of the courtroom a free man, while at the same time clutching that very same coat underneath his arm.

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