Arnold Rothstein, Dark Genius of the Mob

Rothstein reached his pinnacle during the wild days of the "roaring twenties." Despite his wealth, power and influence — outside of his fictionalized participation in the 1919 World Series fixing — Rothstein will be remembered most for the future underworld leaders he helped tutor. In addition to the aforementioned Waxey Gordon other major underworld personalities that came under Rothstein's wing were Jack "Legs" Diamond, Charles "Lucky" Luciano, Meyer Lansky, Frank Costello and Lepke Buchalter.

Jack "Legs" Diamond

Among the men that served as bodyguards for Arnold Rothstein over the years was John T. Nolan, better known as Jack "Legs" Diamond. When Rothstein began bankrolling bootleggers in the early 1920s he helped provide them with trucks, drivers and protection. He hired Diamond and his brother Eddie to oversee this part of the operation. Diamond was soon hijacking some of the shipments he was hired to safeguard. Rothstein soon wearied of Diamond and his antics.

In Anatomy of a Gangster, author Gary Levine gives us this inflated image of Diamond's association with Rothstein:

"Legs Diamond became Rothstein's official bodyguard, consultant on drugs and whiskey, and hit man. Rothstein, in turn, protected Diamond from the authorities and financed many of his gang's operations. As Rothstein's power and operations grew in scope he came to rely more on Legs who, in turn, grabbed a bigger share of Rothstein's profits for himself. Legs guaranteed the security of Rothstein's fifty and one-hundred-thousand-dollar card games and when a gambler was found floating in the Hudson River, it was a good guess that Diamond had escorted him home.

Whomever Rothstein had Diamond "hit" is still a mystery. Rothstein wasn't the only crime figure who tired of Legs. There were several attempts to murder Diamond throughout the 1920s and early 1930s. Legs was wounded so many times that he earned the nickname the "Clay Pigeon of the Underworld." On December 18, 1931 Diamond was murdered in upstate New York.

Charles "Lucky"
Luciano

Luciano always credited Rothstein for teaching him the finer things in life. "He taught me how to dress, how not to wear loud things but to have good taste; he taught me how to use knives and forks, and things like that at the dinner table, about holding a door open for a girl, or helping her sit down by holding the chair. If Arnold had lived a little longer, he could've made me pretty elegant; he was the best etiquette teacher a guy could ever have — real smooth."

Rothstein once took Luciano to Wanamaker's, an expensive clothing store, where the young future crime boss purchased "two or three of everything." When the question of whether to buy suits ready made or made to order came up, Rothstein insisted Luciano have his suits made by a gentile tailor. Luciano gave credit to Rothstein for creating a whole new image for him.

In The Last Testament of Lucky Luciano, the authors claim, "By watching, practicing, imitating, listening to the lessons of Rothstein, he (Luciano) had learned the ways of the rich and had acquired the veneer of a gentleman."

It was Rothstein who introduced Lansky to modern business practices utilized by large corporate firms. He showed Lansky how to turn bootlegging into a formal business operation. Through Rothstein, Lansky met Waxey Gordon. Although the two men would later become personal enemies, during the Prohibition years they were bootlegging partners after Gordon relocated to Philadelphia.

Meyer Lansky

Rothstein introduced both Lansky and Luciano to affluent society people who saw a certain excitement attached to bootleggers. Lansky shied away though, preferring to remain anonymous and work behind the scenes.

Lansky told a biographer, "Rothstein invited me to dinner at the Park Central Hotel, and we sat talking for six hours. It was a big surprise to me. Rothstein told me quite frankly that he had picked me because I was ambitious and hungry." It is no wonder who his mentor was when Lansky, who would outlive most of his contemporaries, remembered this dinner with Rothstein some fifty years later.

Frank Costello

In the early 1920s Frank Costello and his brother Eddie started out as small time rum runners. They worked briefly for Rothstein before using his financing to go big time. By the mid-1920s the Costello / "Big Bill" Dwyer combine was one of the biggest rum running operations on the East Coast.

With the money Costello made he and Rothstein were frequently involved in business deals together, and borrowed from each other. After Rothstein's death investigators found an IOU for $40,000 from Costello in Rothstein's papers.

Costello's biographer, Leonard Katz, wrote in Uncle Frank that "There's no question that the younger, less sophisticated Costello admired Rothstein's shrewdness and learned from him many things not taught in Harvard's School of Business." Whether the finer points of organized crime were taught to Costello or whether he stole them is questionable. Costello once told a reporter that the things he admired in other people he stole for himself.

After Rothstein's death Costello became the new "man between" with Tammany Hall. No other underworld figure would ever have more political influence with the corrupt New York political machine.

Louis "Lepke" Buchalter

Of all Rothstein's disciples only one came from a similar background, Louis "Lepke" Buchalter. Leo Katz tells us, "Lepke came from a good family, his antecedents much like Rothstein's. His people were honest, in comfortable financial condition, pious and educated. Of their children they had trouble only with one, Louis."

Rothstein had held a grip in labor racketeering, but did not get involved in a big way. Buchalter's entrance in the field came in the mid-1920s when Rothstein gave him the opportunity to move into the garment rackets. Buchalter, described as a dreamer with imagination, saw the potential for wealth and power in this area at a time when his contemporaries continued to get rich from Prohibition.

In addition to becoming the number one labor racketeer in America after Rothstein's death, Buchalter took over his mentor's drug trade. In 1939 Buchalter was convicted of federal narcotics charges and sentenced to 14 years in Leavenworth. During the Murder, Inc. trials of the early 1940s Buchalter was found guilty of murder and was executed at Sing Sing in 1944. Buchalter had the dubious honor of being the only organized crime leader to ever be executed.