STATEMENT OF CHAIRMAN JACOB GRUMET, on BEHALF OF THE NEW YORK STATE COMMISSION OF INVESTIGATION

Our Commission is deeply concerned with proposed legislation in The Congress dealing with the very important subject of wiretapping.

In our Third Annual Report, issued in February, 1961, we stated that "criminal law enforcement in (New York) State has been dealt a crippling blow" by Federal Court decisions relating to wiretapping. The decision of the United States Supreme Court in Benanti v. United States thrust law enforcement officials and judges of our state courts squarely on the horns of a most vexing dilemma. As you know, by way of dicta in the Benanti case, the Supreme Court indicated that wiretapping under New York law was illegal and in violation of the Federal Communications Act. As a result of this decision, many judges and law enforcement officials in our state, understandably, refuse to perform an act which, though authorized by state law, has been described as illegal by the Supreme Court of the United States. The public safety and public welfare and important investigations dealing with organized crime and official corruption have suffered.

This Commission and others expert in the problems of law enforcement, presented strong and convincing proof that legal wiretapping, pursuant to court order, and the use of evidence thus obtained, is an obsolutely indispensable law enforcement weapon in the fight against organized criminal activities, racketeering and official corruption. Furthermore, it has been clearly demonstrated that there is no substitute for this investigative procedure in dealing with such cases. In that regard, we refer you to the transcript of our Commission's Public Hearing concerning the wiretapping dilemma which was held in New York City on April 5th and 6th, 1960. We should like to quote but one statement of the testimony given at that hearing by Mr. Frank Hogan, District Attorney of New York County for over 25 years, to emphasize the importance of wiretaps. Mr. Hogan said:

"Wiretapping is a powerful investigating weapon in the field of labor racketeering where the criminals' cunning and the victims', the businesmen's fear, would otherwise combine to conceal crime and make a mockery of law enforcement.

"Our files are full of cases where, but for wiretaps, some of the worst racketeering offenders might well have gone unpunished."

In the years following our public hearing, the need for wiretapping for law enforcement purposes has been proven repeatedly.

Now, almost a decade since the Benanti decision, the damaging situation still prevails. The Congress has failed to act on necessary remedial legislation which has been introduced.

Now, when crime has increased to such alarming proportions as to become recognized as a most serious nation-wide problem, paradoxically, persons both in and out of public office, who lack first-hand knowledge in dealing with the difficult problem of law enforcement, are demanding abolition of all wiretapping. Speaking in the name of “civil liberties," they completely disregard the compelling rights and interest of the public to be protected from the lawless acts of criminal elements. Such persons consistently fail to distinguish between illegal wiretapping and that carried on by law enforecment officers pursuant to law and court order, for the public good. They seek to create the impression that abolition of the latter will somehow eliminate the evils of the former. Nothing could be further from the truth. Moreover, much confusion and unjustifiable concern is being created by gross distortions and misstatements of fact concerning the use of wiretaps.

On March 7, 1967, a letter was sent to Senator John L. McClellan as Chairman of the Subcommittee on Criminal Laws and Procedures, signed by former United States Attorneys for the Southern District of New York, which District, undoubtedly, is one of the largest and most important in this country. This letter urged the enactment of legislation to permit wiretapping pursuant to court order by both Federal and State enforcement authorities.

This Commission full supports the views expressed by these experienced gentlemen and we strongly urge the adoption of their recommendations. In brief, we respectfully propose that The Congress consider legislation which would accomplish the following:

(1) Prohibit all unauthorized wiretapping, with stringent penalties for violators.

(2) Legalize court-authorized wiretapping and the use of wiretap evidence by the states, where state law so permits.

(3) Permit court-authorized wiretapping by federal law enforcement authorities, subject to approval by the Attorney General, in specified areas of major crimes and organized crime.

Such legislation, with appropriate safeguards, would resolve existing confusion and difficulties. It would also be of immense aid to effective law enforce ment. Above all, it would provide society with immeasurable protection against serious criminal invasions into its safety and security.

Mr. ROGERS. Can you epitomize your statement or give us other information we may need in arriving at a conclusion as to this proposal? Mr. GRUMET. Yes. I merely, at the very outset, want to answer a question that was put by Congressman McClory to the previous witness who, I believe, was the attorney general of MassachusettsMr. ROGERS. That is right.

Mr. GRUMET (continuing). And he quoted the attorney general as having stated before this committee something about the differences between jurisdictions where wiretapping was used and where it was not used, and he did not think it was effective. Is that a fair statement? Mr. McCLORY. If the chairman will yield, he did cite the statistic. and then when he finished with the statistic he said that on the basis of that "We have to assume that we can be effective without it." Meaning wiretapping.

Mr. GRUMET. But his statistics, as I understand, were offered to prove what?

Mr. McCLORY. His statistic was that there were 25 more indictments. 25 percent more indictments in those jurisdictions which did not use electronic surveillance as opposed to those which did use it.

Mr. GRUMET. 25 indictments?

Mr. McCLORY. 25 percent more indictments.

Mr. GRUMET. Of what crime? I do not know what he means by that.

Mr. McCLORY. In response to my question he stated that the Federal organized crime statutes were the basis of 25 percent more indictments than in the preceding year. The evidence underlying those indictments were not developed by electronic surveillance. He concluded, therefore, "We have to assume that we can be effective without it."

Mr. GRUMET. I do not know where the attorney general gets his statistics. As the gentleman who just testified said, I do not know whether there are any statistics in this area. But I would say that the evidence that we have is very much to the contrary of what the attorney general contends. I just want to illustrate that by pointing out we have just come from the Senate committee, of which Senator MeClellan is the chairman, dealing with the same subject, and on March 7th of this year, a letter was sent to Senator McClellan as chairman of the Subcommittee on Criminal Laws and Procedures, signed by, I believe, eight former U.S. attorneys for the Southern District of New York of whom one of them is the distinguished gentleman at my left, Mr. Myles Lane, one of my fellow commissioners and a colleague on the commission.

The U.S. attorneys for the Southern District of New York, which district undoubtedly is one of the largest and most important in the country. Now, in their letter all of these gentlemen-and they go back over a period of 30 years, one of them is old enough to have served under President Hoover-they all urge the enactment of legislation to permit wiretapping. I may say with the greatest respect that these

eight U.S. attorneys who have been appointed by four successive Presidents of the United States covering a period of 30 years, have had more experience in this area than the learned Attorney General of the United States. In addition to that, you have the statement which was referred to here before. The gentleman referred to the statement by Mr. Frank S. Hogan who had been the district attorney of New York County for over 25 years and who had a little to do with this work on wiretapping. I just want to quote from the statement that we presented to you here this morning his statement to us at a similar hearing held as far back as 1960. He says, and I quote:

Wiretapping is a powerful investigating weapon in the field of labor racketeering where the criminals' cunning and the victims', the businessmen's fear, would otherwise combine to conceal crime and make a mockery of law enforcement.

Our files are full of cases where, but for wiretaps, some of the worst racketeering offenders might well have gone unpunished.

Mr. LANE. Congressman McClory, I agree with something you said in your questioning of the last witness about the importance of using certain devices to detect crime. I have always been of the opinion that if something is used as a weapon, a gun or anything else or a telephone to commit a crime, it does not make sense to say that you should not use that same weapon to prevent crime any more than if a gun is used by a burglar to commit crime, it is like saying "Well, the policemen cannot use a gun to arrest or to detect him."

In the field of organized crime it has been my experience and that of this Commission that there are two crimes which constitute the treasury of the underworld. I am talking about organized crime. That is, the crimes of gambling and narcotics. Now, anyone who has been in that field, anyone that knows anything about the subject must agree that there is no way that you can combat those two crimes without the use of a telephone.

Now, to give you one specific example, we received word from the dean of Cornell that there was a lot of gambling going on in football games, as to the discrepancy in the score, the numbers, and so forth, the point spread. So we sent a couple of investigators up to Ithaca and we had them in there for a few weeks. Then they discovered that there was something more going on than that. They discovered there was a group of professional gamblers that came in every weekend from Pennsylvania, New York, Connecticut, New Jersey, and so forth. They had a setup that was almost like a motion picture setup. They used a private club there. They made them a payment of so much for the use of the club. They had one of these setups where they had a mirror, and behind the mirror they had a steel door, and in order to get up to the game every weekend, the bartender had to press the button.

Anyway, they had a game going on every weekend where they had as much as $20,000 or $25,000 on the table. I believe we were able to get one of our investigators into that, and from there we got some leads. Using the telephone, getting a wiretap order, for the next 6 or 7 months and we did not use too many wiretaps at all, but we got leads from these wiretaps, we were able to discover the 19 upstate counties, just 19 out of the 62 in New York State, that they were doing a tremendous business in gambling. I am talking about professional gambling.

On a certain day, I think it was the last Saturday of October in 1959, with the assistance of about 400 State troopers we conducted simultaneous raids at 3:30 in the afternoon-and we had a reason for picking that time-in 19 counties, and as a result of that we picked up. or the police picked up I think, about 130 or 150 of these people working in professional gambling.

We hit four banks, one of them in Buffalo, and we collected, I think, $100,000 in cash on that one raid. And for the next 5 or 6 weeks we had our accountants working on this and they were able to ascertain and project the figures to show that these people were doing, in the 19 upstate counties of New York-and this might surprise you-a business of $500 million a year. That is just in 19 counties.

Now, you figure what the profit must be in that engagement, probably anywhere from $50 million to $100 million. Now, under our tax law to make that kind of a profit you would have to have a business worth about several billion dollars.

Now, that money goes into other things, into narcotics, these people get into legitimate business. Once they get into it they us their tactics, they try to control the business-they use some of these strong-arm methods in many instances. We also found in that investigation that no professional gambler can operate unless he has two or three things going for him. Number one, he has got to get the morning line and he gets that by using the telephone. We found out he got it by a couple of outfits, one in Chicago and one in Minneapolis, where they paid so much a day or per week for the morning line. They had to get that in order to have their odds right because these professional gamblers, it is a business with them. They want to get the edge either way.

They must also be in a position to lay off their bets because they are not-the average runner on the street, and so forth, cannot handle big sums of money. So when a bet is made, say, of $10,000, they have to have somewhere to lay it off. They usually lay off, at least it has been our experience, and we got this again from some of our leads, wiretaps, they lay off or did lay off in places like Kentucky, Louisiana, Miami, and Miami Beach.

The third thing that they had going for them in order to operate was to get the race results immediately after a race, no matter whether it is at Aqueduct or down in Florida, get it all over the country because they feel if they can get the results out there, they get these people coming back for plays on the next race, the third race, and so forth.

So what they used, and we have testimony on it, they used what they call a catcher-pitcher situation where they would have somebody stationed, say, at Aqueduct, and with a hand signal he would give the results of the race within seconds after the race was over and someone with fieldglasses stationed outside of the Aqueduct Park-I am giving Aqueduct only as an example-would have an open telephone down in Maryland where they had a battery of, I think it was, 29 telephones all over the United States and they would then telephone the results in there and that would be disseminated through all the customers all over the United States.

Now, I cite that as just one example of what we have found in our own experience. This is not speculation, this is actual fact.

Mr. McCLORY. If I may comment on the observation of Mr. Lane, it would be this: That in our consideration of the legislation which we

have before us, the wiretap legislation, and other, it seems to me that we have to base our judgment on the actual experience of those who are charged with enforcing our criminal laws and who are in the daily business of apprehending and prosecuting the criminal elements with which we are confronted. I think that this one example, for instance, plus the combined judgment of the gentlemen from New York who unquestionably deal with one of the greatest crime problems in the country, is entitled to a great deal of weight, particularly in contrast to some of the theorists who are theorizing upon the subject of the right of privacy as they may interpret it under the Constitution.

Mr. McCLORY. I just want to add this: That I assume, too, that you gentlemen are just as vigorous in your support of legislation to outlaw private, unauthorized bugging and wiretapping as you are in support of official court-authorized electronic surveillance in connection with the fight against crime.

Mr. GRUMET. We have a wiretap bill, as you know, on the books of the State of New York and it is provided for in our constitution. All we are asking you gentlemen to do is to permit us to continue to do this legally. Under the laws of the State of New York it is legal. The people of the State of New York want it, as evidenced by the fact that in the recent legislature there was a bill introduced, only last month, to do away with wiretapping. It went to a vote in the lower house, in the assembly, and was defeated 2 to 1. So that through its representatives the people of the State of New York clearly indicated how they feel about this. They feel very keenly about it, particularly because of the fact that crime is spreading very rapidly.

We have a very bad situation in New York City as we have in other cities all over the country.

Mr. ROGERS. How long has New York had this in its constitution? Mr. GRUMET. New York, I believe, has had this since 1939.

Mr. ROGERS. Since 1939?

Mr. GRUMET. 1939.

Mr. ROGERS. Has crime decreased since 1939?

Mr. GRUMET. Has crime increased? Yes, crime has increased. Yes, crime has increased, but I do not know what your question is directed at. There are many reasons why crime has increased.

Mr. ROGERS. We are all opposed to crime, we want to stamp it out to protect the American citizen. I think we all agree upon that to begin with. But the big problem is: Does wiretapping within itself deter one who may have a desire to commit a crime? Does knowing that his telephone may be tapped deter him from crime?

Mr. GRUMET. No, but it helps considerably in solving many crimes and giving us leads. Now, I think the point was made by Congressman McClory, and it is well taken, after all we are engaged in this dayto-day work and, with all due respect to all, we represent here in addition to all those that I have mentioned literally hundreds of years of experience in this particular field. Now, is this going to be just cast aside because somebody says that it shouldn't be done?

I think Mr. Richardson put it very well when he said that the basic question here is a balance between the rights of the individual, right of privacy and the rights of people.

Mr. ROGERS. Then putting in the balance what you have referred to, and as testified by Attorney General Richardson, of Massachusetts,