America: Still the Land of Opportunity
paid clerks were not the only ones to fall into the Or-ganization's web. In order to put sto-len securities to use, to move them from the United States to Europe, it is necessary to fill out Internal-Revenue forms showing prior ownership, the date the stock was sold and to whom, and the price paid. If the transfer is made from an American owner to a foreigner, a tax of 18 percent is as-sessed. Circumventing all this was no problem. "I have," Zelmanowitz told a Senate subcommittee, "at various times received as much as 3000 such certificates under probably 20 differ-ent names and have received the sig nature guarantees from commercial banks or blank certificates with no amount of securities, no purchase price, no date of purchase entered upon them."
Wherever he turned, Zelman-owitz-and others working the same field-found willing collaborators. On his payroll, he said, at $1000 a week, were agents of the Internal Revenue Service who falsified documents for him. He had allies at First National City Bank and Chase Manhattan Bank, the country's second and third largest banks (after California's Bank of America), and all it cost him was an occasional $50 or $100 bill to "induce a bank vice-president to guarantee in blank any name you so desire to place on these certificates." The brokerage houses, too, assisted the Mob with the necessary forms, even helped trade the securities on the markets. Execu-tives at Hayden, Stone, Bache and Co., at Eastman, Dillon and many others, according to Zelmanowitz, "close their eyes to the fact that we would engage in a criminal activity. The inducement of great commissions being paid to them seems to have been the only motivating factor."
The vast bulk of the stolen and counterfeit securities eventually find their way across the Atlantic, where they loran one of the bases for laun-dering funds from other rackets for return to America. "Banks in Basel, Geneva and Lausanne as well as bro-kerage firms and banks in Belgium were necessary for our manipula-tions." No one is certain just how much loot the Mob has stolen from the se-curities market. By the early 1970s, known thefts were running to more than $45,000,000 annually, but the judgment of the experts is that this is a fraction of the total. A confidential report by investigators to Senator John McClellan and his committee estimates that there may be more than $25 billion in stolen and coun-terfeit securities
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