But Treasury agents were closing in on the gang. Narcotics agents, with aid from Customs agents, had opened an investigation of Lepke’s narcotics smuggling ring after an informant had squealed to Narcotics Commissioner Harry Anslinger. The informant—whose name has never been disclosed—was a woman with revenge in her heart. Her boy friend—one of the Lepke mob—had been playing around with another woman and she wanted to get even with him for his infidelity. She gave Anslinger enough information, with facts that could be verified, to start the ball rolling. Bit by bit, the agents closed in on the gangsters. And they discovered by a close check of the stickers issued to all pier personnel that there was an irregularity in the stickers which had been issued to the guards McAdams and Hoffman.
As the agents began to put on the heat, underworld characters started to talk. Those “world travellers” who had helped bring narcotics into the country began to confess. Evidence mounted against the gang, and when the crackdown finally came, a total of thirty-one persons were involved. Lepke was indicted on ten counts of a conspiracy to smuggle narcotics into the United States.
At this time—December, 1937—Lepke was a fugitive. A little more than a year earlier he and Gurrah Jake Shapiro had been convicted on the antitrust charges brought against them four years earlier. They had been sentenced to two years in prison and fined $10,000. But Lepke appealed. He was released under $3,000 bail and immediately went into hiding.
For almost two years Lepke’s pals hid him from the law. He lived for a time in the old Oriental Dance Hall on Coney Island. Then, twenty pounds heavier and wearing a mustache, he moved to a flat in Brooklyn. Later he occupied a house in Flatbush, posing as the paralyzed husband of a Mrs. Walker. All this time he continued directing the affairs of his criminal organization.
But now, in 1939, the search for Lepke had become the most intense manhunt the country had seen in years. The Federal government wanted him on the narcotics charges growing out of his syndicate operations. And he was the No. 1 man on the most-wanted list of New York’s District Attorney Thomas E. Dewey, who then was opening his first bid for the Republican Presidential nomination. Among other things, Dewey was certain he could pin a murder charge on Lepke—who now had “dead or alive” rewards on his head totalling $50,000.
As the pressures mounted, the hunted man became desperate. And desperately he tried to wreck the cases against him by sending witnesses out of the state, by intimidation, and by murder. The heat was on the underworld as it had never been before. The rumor spread that if Lepke did not surrender to the authorities, he would be killed by one of his own kind. Lepke had at last become too much of a liability even to his old pals.
Hunted and frightened, with every day holding the threat of sudden death, Lepke began negotiations to surrender to New York Columnist Walter Winchell—on the condition that he would be turned over to the FBI rather than New York State authorities.
During the evening of August 5, Winchell received a telephone call from a man who refused to identify himself. “Lepke wants to come in,” he said. “But he’s heard so many different stories about what will happen to him. He can’t trust anybody, he says. If he can find someone he can trust, he will give himself up to that person. The talk around town is that Lepke would be shot while supposedly escaping.”
Winchell called FBI Director John Edgar Hoover in Washington and told him of the mysterious call and Lepke’s willingness to surrender if he could be assured of protection.
Hoover told Winchell: “You are authorized to state that the FBI will guarantee it.”