So I am wondering, in addition to what I suggested a while ago, why would it not be advisable to get after the man who you say is responsible for these great_gambling slot machines syndicates, himself, get after that man and those who are in collusion with him. Is there a law to reach that kind of an individual?

Mr. PRESTON. There are State laws.

Mr. HARRIS. I mean a national law.

Mr. PRESTON. There are no national laws unless you get them on income-tax evasion.

Mr. HARRIS. Why should not Congress consider some legislation that would catch him, just like they did the kidnapper?

Mr. PRESTON. This will do it.

Mr. HARRIS. How much more will it catch?

Mr. PRESTON. I would like to answer the question raised by the gentleman from California, in this connection. The point is well taken, and I have an amendment here in practically the same language the gentleman read, which would exempt the common carriers, and they should not be charged with inspecting merchandise.

Now, the other question you raise about the parts, that is taken care of in section 3 of the Senate bill, prepared by the Justice Department, which requires the manufacturer to report to the Attorney General the serial number, a description of the article shipped, and he has to make an inventory filing with the Justice Department, and he may do it by sending duplicate copies of the invoices. That is the way we are striking at it, is by requiring the manufacturer to furnish the Justice Department with a description of the article, the serial number, even of a spare part, and an accurate description of it.

Mr. HINSHAW. I would like to address a question to Mr. Harris as an attorney who has had experience in this matter, and also the gentleman from Georgia, who is likewise an attorney, as to just how this law would be enforced. Is it proposed that Federal othcers shall enforce this law?

Mr. PRESTON. Quite naturally; yes.

Mr. HINSHAW. Do I understand that the State officers, if they catch somebody accidentally who may have violated a Federal law, will eventually turn him over for prosecution to the Federal officials, but they do not go out to search for violations of Federal law; is that correct?

Mr. HARRIS. The theory has been, in matters of other kinds, as Mr. Preston mentioned with reference to liquor violations and narcotics violations, and so forth, if it is a local situation and a violation of the law locally, sometimes the State will go ahead and handle it, and when they get through they will turn it over to the Federal; and sometimes the Federal will be with them and they will take them. A lot depends on the situation locally there. There are certain cases where some feel that because of various situations, the Federal Government should handle it, and they turn it over to them.

Mr. HINSHAW. My point is that the local law-enforcing officer ordinarily does not figure it is his duty to go out and search for violations of Federal law, does he?

Mr. HARRIS. That is true.

Mr. HINSHAW. It would be merely in the course of his business in enforcing the local law that he would discover it as a violation of this Federal law, is that not correct?

Mr. HARRIS. I think that is correct, but I believe what our colleague is trying to reach is the source itself and deal with it at the origin, and not at the exterior. I believe that is right.

Mr. PRESTON. That is right, the source of supply.

Mr. HINSHAW. I get that; but this requires a force of law-enforcement officers.

Mr. HARRIS. There is no question about it.

Mr. HINSHAW. What branch of the Government is going to supply those law-enforcement officers, and how many is it going to require? Mr. HARRIS. No one can say how many it will require, because you would not know the extent of it. Consequently, I think that each district-that is my opinion about how the courts operate each district would have responsibility in that district insofar as the local situation is concerned.

Mr. HINSHAW. Let us take a good look at this thing, because the law enforcement is very important. Let us say that somebody manufactures one of these slot machines, and he puts it in an unmarked carton or crate, and it is sent by a common carrier, and we exempt the common carrier because he cannot be made responsible for everything that goes into a box, as he would have to open all of the boxes. But at all events, it is ultimately delivered to the consignee. That is in interstate commerce. Where is your law-enforcement officer going to discover the violation of the law unless he investigates every shipment that is made that he suspects as being one of these machines?

Mr. PRESTON. I may say to the gentleman from California that you might ask the same question about lottery tickets, and narcotics, and other types of crime. The manufacturer is taking the risk when he ships it, because there are only 10 existing today in America, and every one of them is located in one State, and he is just taking a chance, that is all.

Mr. HINSHAW. You mean they cannot set up a factory in another State if they want to?

Mr. PRESTON. They could, but I hardly think a businessman would jeopardize that much money to put up an illegal enterprise or manufacturing enterprise which of necessity must be pretty well known as to what they are making.

Mr. HINSHAW. This is a pretty profitable enterprise, and I should think they could afford to do practically anything.

Mr. PRESTON. Not to the manufacturer, because he makes a reasonable profit. The money is made out of the operating and the distributor who puts them in the juke joints and the taverns.

Mr. HINSHAW. Who owns these machines? Are they not owned by the manufacturer?

Mr. PRESTON. Not at all, sir. There are three steps-the manufacturer, a distributor, and the operator-and the operator is the man who goes to the man running the beer joint and he says, "I want to put this machine here on a 50-50 or 60-40 basis," and the profit is not made by the manufacturer nor by the distributor, but by the operator. A machine is reasonably inexpensive, and consequently a manufacturer could not take much of a chance. with a penalty involved like we have in here, to manufacture these machines. He is required to certify to the Justice Department every machine he ships in interstate commerce, giving the name of the consignee, under this legislation.

Gentlemen, I would like to say this about this bill: It was prepared by some very able lawyers of the Justice Department, and I think if you study it you will find that it has met practically every contingency except the one with reference to the common carriers.

Mr. DOLLIVER. Which one are you referring to?

Mr. PRESTON. The Senate bill, and I think we should direct our attention principally to that, because my bill that I prepared is limited. in its operation because I did not have the time to make a great deal of research in preparing the actual language.

Mr. HINSHAW. I would like to point out to the distinguished gentleman from Georgia that while the State of California appreciates his reference to the Crime Commission report which was referred to,. and he has gone into it in some detail in his original statement before the committee, the mere fact that the Crime Commission did make a study of the situation in California and did so report does not indicate in any manner whatsoever that this slot-machine racket is any worse in our State than in any other State. It is simply the fact that our State did take upon itself the duty of making an examination and report, and I suggest that slot machines may exist also in places in the State of the gentleman from Georgia.

Mr. PRESTON. I so acknowledged in my remarks previously.

Mr. HINSHAW. And probably in other States in the United States, and it is not a device that is used in the State of California alone.

Mr. PRESTON. I regret very much the gentleman thought that I intended to reflect upon his State, because I certainly did not. I needed to refer to the States on which data were available, and it does reveal that the State of California has been perhaps more active in trying to solve the problem than any other State in the Union.

Mr. HINSHAW. It has been diligent, I can assure the gentleman, and I hope it will become a diligent effort in every other State.

Mr. O'HARA. I would like to say that I appreciate your kind reference to Minnesota. I think probably there is no State in the United States which has had as vigorous a campaign against the operation of slot machines as Minnesota has in recent years. Prior to that we had laws, because I was a county attorney between 1934 and 1938, and I was blessed with one of the finest law-enforcement sheriffs that. any prosecuting attorney ever had, and he and I would not permit the operation of slot machines; and it was a matter of pride, and in fact we are reported to be one of three counties in the State where the slot machines could not do business, as they said. The sheriff would go around and raid these places, with deputies, and bring in the slot machines, and we would confiscate and destroy them and take the money and deposit it in the county treasurer's office. Afterward, we would have to go through the same proceedings again. Amazingly, in one instance, one of the village officials came in and said, "Look, you picked up our slot machine. We were operating with this boy, and we were getting a percentage." We said, "That is just too bad. We do not want to have to try the village officers, but if you continue to do that, we will do it."

It does show, and the gentleman knows, of course, that many clubs and organizations used to finance themselves with the operation of slot machines, taking the money away from their members by the operation of slot machines. So, notwithstanding it has been against the law

all of these years in the respective States, it is a little bit touched, like prohibition, with the matter of enforcement, that when you have good law enforcement they do not run slot machines. Will the gentleman agree with me on that?

Mr. PRESTON. Certainly, I do.

Mr. O'HARA. And you have the same problem in this bill. It is a question of what kind of enforcement you are going to get, and what kind of cooperation are you going to get from the people. You know, a good law without public feeling in back of it is not going to be well

enforced.

I do think the gentleman's idea in the bill, and in the bill passed by the Senate, goes to the source, the manufacturing and distribution of those parts. But the question that comes to my mind, I would say to the gentleman, what are you going to do about these machines that are in operation? Do they break down pretty rapidly and have to be replaced with parts?

Mr. PRESTON. I think in fairness I would have to admit that the machines currently in existence would be permitted to operate where they are condoned in the States or in the communities. This law, of course, would be applicable only upon its enactment.

Mr. WILSON. Mr. Chairman, I am going to have to leave the committee, but I want to say for myself that I compliment the witness before us, our colleague from Georgia, for his courage on this bill. Fundamentally Mr. Preston, you are right, and every honest American citizen must of necessity concede that.

I think you, too, like myself and many others here, have had the experience during the war days of many a soldier in the hospitals seeing, not with connivance but just winking on the side of the military authorities, in the hospitals and in the officers' clubs and in the recreation rooms, these one-armed bandits. The odds there are not even 90 to 10, and not even 95 to 5. Sometimes it is not even 99 to 1. The operation of the entire club is paid for by the dependents of the man in the hospital. It has been going on for years, with the military authorities permitting it.

I had the privilege of serving in the Armed Forces at one of our posts some 412 years, with over 50,000 soldiers there, and I had a voice in the control of that particular item, and the one-armed bandits did not operate while I was in control, over 25 months, and we made money by other legitimate means rather than by the one-armed bandit.

I think fundamentally you are striking at a thing where an American citizen who has a desire to take part in a game of chance can do so where he has got half a break. I think that you are fundamentally striking at a thing where you do not want America to degenerate like a lot of our neighboring countries where they have legalized and federalized not only lotteries but a lot of debasing gambling.

I think fundamentally that is the thing that you are striking at, and I think that the bills before us have the groundwork to do something about it, and I compliment you.

Mr. PRESTON. I thank you very much, Mr. Wilson.

Mr. HESELTON. Mr. Preston, I read those articles in Collier's. I was formerly a prosecuting officer for 6 years. We dealt with the situation in two ways: One, we had a statutory provision which carried. a fine or jail sentence, or both; and rather early, when the situation began to develop, I asked for jail sentences. The courts cooperated

with my office, and after we secured a couple of rather stiff jail sen-tences, we did not have much to worry about on that score. But we did find an outcropping of gambling, the use of bookies, and that sort of thing, and we decided then to invoke a provision on our statutes to› padlock those establishments. I called in everyone suspected by my staff and the local police, and told them that we had good reason to believe, although we could not prove it, that they were operating illegal gambling establishments, and that if they were brought in we would invoke padlocking. That was quite effective in closing down that phase of the thing.

Then finally we had occasion to get complaints from time to time. about bookie joints that were not this type, but the telephone bookie shops. We conducted one raid and took the telephones out and confiscated them, and we had quite a battle with the telephone company as to whether we could or could not retain them.

I think on the local statute books in most States there is ample law to prevent what one of my colleagues brought out was the continued illegal operation of these one-armed bandits, or any other phase of organized crime.

I do not know what the scope of this hearing is going to be, whether it is limited to your bill and the Senate bill or whether it carriesthrough these related forms of crime which are just as serious, in my opinion, and which in many areas have led to the organized gangsters getting in and taking over. But I would hope, if this committee felt it wise, that we might go further than just a limited suggestion of one admittedly serious illegal practice, and see if we would be helpful to the local authorities.

You may have explored the existing State laws and what might be done in terms of strengthening them. Do you have any comment on that?

Mr. PRESTON. I heartily agree that we should not, of course, limit our consideration or our approach to this proposition of crime, to one thing. This is just one way. And there is another bill which is pending, offered by the Attorney General as a result of his crime conference which was held, which would do just what the gentleman said. That bill has not been enacted in the Senate, as you know, but I think if it is enacted and passed by the Congress it will do more to eliminated organized crime and rackets than any other legislation.. Coupled with the slot machine bill and the others, that will do it.

Mr. HESELTON. I share the points of view that have been expressed by Mr. Harris and Mr. Hinshaw, that we should be careful we do not draw a law that will reach out too far and inflict unfair conditions upon legitimate business. But from my own experience, I am not too much concerned about developing an approach toward this problem from the Federal point of view as well as from the State point of view. It has been my experience that, if the local officers want it, they can get complete cooperation from the Federal agencies. We did it repeatedly in connection with the interstate transportation of stolen automobiles, by asking and receiving Federal assistance. We arrested a gang that was operating between Massachusetts and Canada, solely because we could get the Federal officers and the Canadian Mounties in and break the case wide open.

I am not bothered about any alleged duplication. I think it is helpful.