APPENDIX I [From the New York Post, Dec. 15, 1972] THE LIFE & TIMES OF HARRY DAVIDOFF (By Robert Garrett) The court-ordered gags on Harry Davidoff's past have been lifted, following the latest of his many confrontations with law-enforcement agencies. The story of the secretary-treasurer of Teamsters Local 295 can now be told. The labor boss of Kennedy Airport was convicted last night of 21 separate violations of the Taft-Hartley labor relations law involving the use of his union position to get free airplane tickets. Each count carries a maximum one-year sentence. He was acquitted of two more counts and an extortion charge was thrown out before the case went to the jury. Davidoff, 55, a tough-looking, tough-talking man with a sixth-grade education, has been shot, arrested, questioned by Congressional panels and investigated by the FBI. His convictions, dating from the 1930s, include burglary, extortion and gambling. Numerous arrests for felonious assault with a knife, possession of a gun, grand larceny and extortion are listed on his record. Only last year, Davidoff is said to have threatened a magazine photographertelling him: "I could have you killed." The photographer took his picture anyway, perhaps not realizing that the union boss-in charge of hundreds of men handling cargo at Kennedy Airport-was once closely linked to Murder Incorporated, the syndicate's killer squad. Harry (Ďuff) Davidoff's crime career began in 1933, when he was 15. By 1943, when he and a brother were shot in a Brooklyn bar and grill, he had gained a fearful reputation and been arrested nearly a dozen times. The first arrest resulted in a three-year suspended sentence for burglary. In 1940, Davidoff received a suspended sentence for attempted extortion and in the summer of 1943 he was picked up for policy and bookmaking. The bar shooting, police said at the time, was the result of a gang war in the Brownsville-Canarsie area over control of rackets. Davidoff and his brother, William, were said to be targets of a hired gunman. But Davidoff-who got one slug in his belly-survived. In the early 1940s, when Davidoff was awaiting trial on charges of conspiracy to violate state banking laws, a madam to whom he had loaned $100 charged him with threatening her with death. Davidoff was sent off to jail for the madam's protection. The next day he was convicted on the conspiracy charge. The burly gangster eventually found his niche. He moved from one union to the next in a variety of positions: once as secretary, another time as treasurer, then for a short period as president of Toy and Doll International, AFL, Local 130. As the Toy and Doll boss, Davidoff was named a "trustee" of the union's welfare fund-until the State Insurance Dept. got wind of some expensive hankypanky with the fund's $58,344. In 1953, Davidoff quietly siphoned off $4600 for a new car and $225-a-week “salary," plus a weekly expense account of $75. The SID investigation, which stemmed from the murder a year earlier of Thomas Lewis, labor czar at Yonkers Raceway, resulted in rapid union statements denying anything was wrong. They also resulted in Davidoff's quick switch to another union. JOINED TEAMSTERS IN 1960 In 1960 Davidoff made it into Teamsters Local 295, a union representing cargo handlers, truck drivers and other ground workers at Kennedy, the world's largest cargo terminal. When he arrived, mob chieftains Vito Genovese and John (Johnny Dio) Dioguardi were said to be in direct charge of the lucrative air freight business at Kennedy. Davidoff quickly gained control of the union and in 1966, when an investigation into cargo thefts forced president John McNamara to quit, Davidoff became its boss. Davidoff once boasted he could close the airport down "with a word." But under oath he was always very sparing with words, taking the Fifth Amendment instead. NO TESTIMONY During one such episode, late in 1967, Davidoff faced the State Investigation Commission-probing charges of sabotage, bribery levied against the unionwithout a lawyer. "I'm not ready to give no testimony," he said. "Without an attorney, I will give no testimony." When he did appear with an attorney a week later, he took the Fifth Amendment scores of times, as did other mob bigwigs. Last year, Davidoff was termed a "key organized crime figure" in testimony before a Senate rackets panel. The testimony, given in June, 1971, by James Landry, general counsel of the Air Transport Assn. of America, said: "Harry Davidoff is the only remaining key organized crime figure associated with JFK Airport who has not been arrested as a result of investigations conducted by federal and local law enforcement authorities. But Davidoff's time had come: In November, a sealed indictment charged him with extorting nearly $10,000 worth of tickets from Trans-Caribbean Airways over a period of five years, beginning in 1966. SAID HE MADE THREATS The 25-count indictment said Davidoff had threatened the airline with a multitude of labor troubles-including strikes-if they didn't give him free tickets, some of which he could pass on to family members. All but one count named specific instances of ticket use, each representing one year and/or a $10,000 fine. The main charge extortion-carried a penalty of 20 years and a $10,000 fine. The week-long trial, began Dec. 5 with defense attorney Michael Gillen showing a clipping from that day's Daily News to Brooklyn Federal Court Judge John Bartels. The News story said Davidoff had long been "a target of local and federal law enforcement authorities" and linked the union boss to "the incursions by organized crime at JFK." The lawyer said the statements were "prejudicial" to his client. Judge Bartels agreed. Calling the reporter, Robert Kappstatter, before the bench, the judge threatened him and the News' editors with contempt, and said he would oust him from the trial if such stories continued. CAN'T BE TRUSTED The next morning, after only one witness was heard, the judge again criticized the press. To Kappstatter he said: "I see you can't be trusted." Other newspapers, including The Post, had noted Judge Bartels' earlier admonitions and had run articles mentioning Davidoff's tarnished background. The Post, the News and the New York Times were asked to promise not to publish any more information not brought out during the trial itself. The Post, while declining to submit to any pre-censorship, agreed to abide by the state's voluntary Fair Trial-Free Press code and limit its coverage of the trial to the testimony alone. The Times, through counsel, argued that Davidoff's background was essential to its coverage of the trial. The News, also represented by an attorney, assured the court that Davidoff would get a "fair shake" in its stories. Judge Bartels, meanwhile, listened to motions for a mistrial, a change of venue and sequestering of the jury. All were denied. The jurors, polled by the court, all said they had not read any account of the trial in the papers. Last Monday, when the trial resumed after a three-day adjournment, Judge Bartels again criticized the media for its coverage. He said an article in Newsday, which included Davidoff's arrest record along with other background information, was "prejudicial" to the defendant, and could result in a mistrial. A mistrial, said Judge Bartels, would be "directly attributable to the prejudicial statements which might be made in the media"-newspapers, radio or television"that would interfere with the administration of justice." APPENDIX II [From the Sunday News, Feb. 25, 1973] SWINDLER MAKES 250G BAIL BUT STILL WINDS UP IN JAIL (By Paul Meskil) For financial finagler Louis C. Ostrer, it was a case of out of the frying pan, into the fire. Or, more specifically, out of Civil Jail and into the Tombs. Ostrer, a convicted swindler whose pals include underworld bosses, wanted his freedom so much he put up $250,000 bail to get it. But it lasted only a few minutes. Rearrested for alleged violation of probation, he spent the weekend behind bars in the Tombs, Manhattan's House of Detention for Men. His latest bout with the law began Thursday when he appeared in Manhattan Supreme Court as a material witness in a grand jury probe of organized crime. Assistant District Attorney John Fine asked Justice Jacob Grumet to hold Ostrer in $10 million bail because "his life is in danger." "If this man is at large," Fine added, "I have no doubt that he will be killed." He said the roly-poly Ostrer "has important information" about a mob plot "to assault and murder a certain person." Ostrer denied this. "To say I have any knowledge of any wrongdoing is absurd," he insisted. "To say that my life is in danger is absurd." Grumet set bail at $250,000 and sent Ostrer to Civil Jail until he could post the bond, which he did Friday. As he left the jail on W. 37th St., preparing to go home to 181 Kings Point Road in Great Neck, L.I., he was rearrested by officers bearing a warrant charging him with violating the terms of a 1969 probation agreement. WAS "THE GREATEST" In June 1969, Ostrer pleaded guilty of stealing, forging and cashing $338,370 worth of checks belonging to his employer, Canada Life Assurance Association of Toronto, which had once called him "the greatest insurance salesman on the continent." Placing Ostrer on five years' probation, Manhattan Supreme Court Justice Xavier Riccobono had said: "It would appear that almost any venture you undertake, obviously because of those talents and gifts that have been given to you by the Almighty Himself, seems to enable you to convert almost anything into a very successful enterprise. It is inadvisable, under these circumstances, for the court to take these talents, these God-given talents, and incarcerate them by incarcerating you." Last month, Ostrer and Mafia Mobster John (Johnny Dio) Dioguardi were convicted in Federal Court of conspiring to manipulate stocks. They were accused of plotting a $1 million stock swindle. They are to be sentenced March 13 and could get up to five years in prison. At Thursday's court hearing, prosecutor Fine said Ostrer had information on big-time loan-sharking and was "indebted to known criminals" who run loanshark operations and have more than $75 million "out on the street" on any given day. APPENDIX III U.S. GENERAL ACCOUNTING OFFICE, APRIL 13, 1973 REGIONAL MANAGER, NEW YORK-ALFONSO J. STRAZZULLO (Review of Plans, Programs and Financial Transactions Relating to the Severance Benefit Trust Fund of Local 295 (Code 97518)) We have completed the additional work requested by the Permanent Senate Subcommittee on Investigations and the results are included in the attached workpaper summary. To recap, our review was primarily concerned with determining whether the plan is adequately funded to protect the rank and file of the Local's membership. We have satisfied ourselves that the severance benefits paid were in accordance with the rules and regulations of the fund. In addition, we have also reviewed the life insurance benefits paid for deceased employees and again are satisfied that the rules and regulations of the fund were compiled with. Other matters that came to our attention concerning the administration of the fund have been enumerated in the attached workpaper summary. If we can be of any further assistance to the Subcommittee on this matter, please let us know. The workpapers on this assignment are being retained in this office. Attachment. SUMMARY ON THE REVIEW OF THE SEVERANCE TRUST FUND OF LOCAL 295 INTERNATIONAL BROTHERHOOD OF TEAMSTERS BACKGROUND At the request of the Senate Permanent Subcommittee on Investigations, the GAO reviewed the Severance Trust Fund of Local 295, International Brotherhood of Teamsters. The review which was performed at the local's office near John F. Kennedy Airport consisted of an analysis of receipts and disbursements for the trust fund during the period December 1, 1970 through November 30,1972. Local 295 has a membership of 1300-1400 individuals who are engaged in the trucking of air freight at John F. Kennedy Airport, New York, N. Y. The current union agreement which was negotiated for the three year period effective December 1, 1970 provides for the establishment of a Severance Trust Fund for the employees. The agreement called for a contribution by the employees of $15 per employee per week during the first year of the contract with successive increases during the second and third year to $30 and $40, respectively. Upon severance, regardless of the reason, the employee shall receive what has been contributed in his behalf plus any increments that may have accrued on his behalf less his applicable portion of fund expenses and insurance premiums. However, the member is guaranteed that as a minimum he will receive what his employer contributed for him. For those employees who entered the program after December, 1970 and who subsequently terminated, the amount received would only represent a percentage of the amount contributed. An insurance provision was added to the Severance Trust Fund which provided death benefits to the survivors of employees vested in the program. The program provides the beneficiary with the option of receiving the proceeds of the program over a stipulated period or taking the proceeds in a lump sum. The latter method considers certain downward adjustments to the face value of the policy. Fringe Programs, Inc. was selected to be the administrator of the Local 295 STF. In addition to its function as administrator, it was authorized to negotiate the proposed life insurance with a duly licensed agent and to obtain the best terms and conditions available for the STF. Fringe Programs selected Cy Reeves Snyder to be the agent; subsequently, he was replaced by Dina Gelman. Local 295 STF purchased insurance for its members from the first year contributions from Executive Life Insurance Co. of New York. This insurance was increased with the increase in contributions during the second year (beginning 12/1/71) by purchasing additional insurance from Transworld Life Insurance Co. These insurance policies were individual whole-life policies with the fund as beneficiary. RESULTS OF REVIEW Cash Receipts and Disbursements Local 295 STF had receipts totalling_$3,304,336 for the two-year period December 1, 1970-November 30, 1972. During the same period $2,156,171 was disbursed (not including interbank disbursements), resulting in a net cash balance of $1,148,165 at November 30, 1972. Local 295 STF has had four checking accounts during the two-year period: When there were two Central State accounts, one was used for normal receipts and disbursements and another ("disbursement account") was used to disburse payments to severed and deceased union members. Sources and Applications of Cash The major source of cash for the STF was employer contributions. These totalled $2,966,220 for the two year period December 1, 1970-November 30, 1972. The largest use of this cash was for insurance premium payments which totalled $1,531,234. The following schedule shows the major sources and applications of cash: (A) Employer contributions.-Employer contributions totalled $2,966,220 for the two-year period. Local 295 contributed $11,940 itself; local 295 STF as an employer contributed $1,815; and local 295 group welfare and pension fund contributed $12,950. (B) Life insurance proceeds.-For the period December 1, 1970-November 30, 1972, the STF received life insurance proceeds totalling $312,500 representing the collection of the face amount of policies on fifteen employees who died. As of November 30, 1972 benefits on twelve of these cases had been settled. These settled cases had face amounts totalling $250,750 and benefits of $192,244 were paid on them to beneficiaries. The difference of $58,505.55 was incorporated into the fund as income due to beneficiaries electing to take the life insurance in a lump sum (and, hence, receiving only a commuted or discounted value) instead of taking the full amount over a ten year period. (C) Interest income.-Interest income totalled $11,876 for the two year period. This consisted of interest received on cash deposited in savings accounts and invested in certificates of deposit. Cash disbursements (a) Premiums-Executive Life of N.Y. and Transworld Life Insurance Co. The local 295 STF disbursed a total of $1,531,234 for premiums on insurance policies to Executive Life of N. Y. and Transworld Life Insurance Co. Premiums were paid to these insurance carriers on a monthly basis. A total of 27 checks were written to Executive Life of N. Y. totalling $1,014,571. A total of 13 checks were written to Transworld Life totalling $516,663. (b) Life insurance benefits paid The local 295 STF paid $192,244 in life insurance benefits to beneficiaries of twelve union members who died. All of these payments were taken in a lump sum known as commuted value with the exception of one death claim. (c) Severance benefits paid During the two year period ending November 30, 1972, the STF disbursed $175,764 in severance benefits to a total of 242 employees of Local 295 who terminated their employment. These members received as their severance benefit the amount of money contributed for them into the severance fund by their employers. 71-542-76 |