FRAUD EXPOSED

Wairarapa Times-Age, 3 August 1938, Page 5

FRAUD EXPOSED

DISTILLATION OF ALCOHOL FROM SHOE POLISH WHOLESALE ARRESTS MADE IN NEW YORK. x MANY OFFICIALS AND OTHERS INDICTED By Telegraph—Press Association. Copyright. NEW YORK, August 1. A Federal grand jury has indicted 103 men, including policemen, Federal Treasury agents, doctors and druggists, on charges of distilling alcohol and brandies from materials, including shoe polish and cleaning fluids. This is considered to be the biggest round-up in the history of the city, even including the prohibition era. The ring, in which the accused worked alongside apparently respectable professional men, is charged with defrauding the Government of at least 2,000,000 dollars in taxes over a period of three and a half years. Eighty-six of the defendants were immediately arrested and warrants have been issued against the others. Investigators said that the ring distributed 10,000 gallons of alcohol every week to druggist for prescriptions,’ to extract-makers for resale to bakers and to doctors for medical purposes at half the regular price. It is alleged that policemen extracted bribes from purchasers by threats of arrest. The headquarters of the ring were at the same address as that used by “Lucky Luciano, head of New York’s vice racket.