Hidden in Plain Sight: The Shocking Origins of the Jeffrey Epstein Case

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from MintPress News:

Epstein is only the latest incarnation of a much older, more extensive and sophisticated operation that offers a frightening window into how deeply tied the U.S. government is to the modern-day equivalents of organized crime.

Despite his “sweetheart” deal and having seemingly evaded justice, billionaire sex offender Jeffrey Epstein was arrested earlier this month on federal charges for sex trafficking minors. Epstein’s arrest has again brought increased media attention to many of his famous friends, the current president among them.

Many questions have since been asked about how much Epstein’s famous friends knew of his activities and exactly what Epstein was up to. The latter arguably received the most attention after it was reported that Alex Acosta — who arranged Epstein’s “sweetheart” deal in 2008 and who recently resigned as Donald Trump’s Labor Secretary following Epstein’s arrest — claimed that the mysterious billionaire had worked for “intelligence.”

Other investigations have made it increasingly clear that Epstein was running a blackmail operation, as he had bugged the venues — whether at his New York mansion or Caribbean island getaway — with microphones and cameras to record the salacious interactions that transpired between his guests and the underage girls that Epstein exploited. Epstein appeared to have stored much of that blackmail in a safe on his private island.
Claims of Epstein’s links and his involvement in a sophisticated, well-funded sexual blackmail operation have, surprisingly, spurred few media outlets to examine the history of intelligence agencies both in the U.S. and abroad conducting similar sexual blackmail operations, many of which also involved underage prostitutes.

In the U.S. alone, the CIA operated numerous sexual blackmail operations throughout the country, employing prostitutes to target foreign diplomats in what the Washington Post once nicknamed the CIA’s “love traps.” If one goes even farther back into the U.S. historical record it becomes apparent that these tactics and their use against powerful political and influential figures significantly predate the CIA and even its precursor, the Office of Strategic Services (OSS). In fact, they were pioneered years earlier by none other than the American mafia.

In the course of this investigation, MintPress discovered that a handful of figures who were influential in American organized crime during and after Prohibition were directly engaged in sexual blackmail operations that they used for their own, often dark, purposes.

In Part I of this exclusive investigation, MintPress will examine how a mob-linked businessman with deep ties to notorious gangster Meyer Lansky developed close ties with the Federal Bureau of Investigation (FBI) while also running a sexual blackmail operation for decades, which later became a covert part of the anti-communist crusade of the 1950s led by Senator Joseph McCarthy (R-WI), himself known throughout Washington for having a habit of drunkenly groping underage teenaged girls.

Yet, it would be one of McCarthy’s closest aides who would take over the ring in later years, trafficking minors and expanding this sexual blackmail operation at the same time he expanded his own political influence, putting him in close contact with prominent figures including former President Ronald Reagan and a man who would later become president, Donald Trump.

As will be revealed in Part II, after his death, this blackmail operation continued under various successors in different cities and there is strong evidence that Jeffrey Epstein became one of them.

Samuel Bronfman and the Mob

The Prohibition Era in the United States is often used as an example of how banning recreational substances not only increases their popularity but also causes a boom in criminal activity. Indeed, it was Prohibition that greatly increased the strength of the American mafia, as the top crime lords of the day grew rich through the clandestine trade and sale of alcohol in addition to gambling and other activities.

It is through the bootlegging trade of the 1920s and the early 1930s that this story begins, as it brought together key figures whose successors and affiliates would eventually create a series of blackmail and sex trafficking rings that would give rise to the likes of Jeffrey Epstein, the “Lolita Express” and “Orgy Island.”

Samuel Bronfman never planned to become a major producer of liquor but true to his family’s last name, which means “brandy man” in Yiddish, he eventually began distributing alcohol as an extension of his family’s hotel business. During Canada’s Prohibition period, which was briefer than and preceded that of its southern neighbor, the Bronfman family business used loopholes to skirt the law and find technically legal ways to sell alcohol in the hotels and stores the family owned. The family relied on its connections with members of the American mafia to illegally smuggle alcohol from the United States.

Soon after Prohibition ended in Canada, it began in the United States and, by the time the flow of illegal alcohol had turned the other way, the Bronfmans – whose business ventures were then being led by Sam Bronfman and his brothers — were relatively late to an already flourishing bootlegging trade.

“We were late starters in the two most lucrative markets – on the high seas and across the Detroit River. What came out of the border trade in Saskatchewan was insignificant by comparison,” Bronfman once told Canadian journalist Terence Robertson, who was then writing a biography of Bronfman. Nonetheless, “this was when we started to make our real money,” Bronfman recounted. Robertson’s biography on Bronfman was never published, as he died under mysterious circumstances soon after warning his colleagues that he had uncovered unsavory information about the Bronfman family.

Samuel Bronfman mob

Samuel Bronfman pictured in 1937 with his sons Edgar and Charles

Key to Bronfman’s success during American Prohibition were the ties his family had cultivated with organized crime during Canada’s Prohibition, ties that led many prominent members of the mob in the United States to favor Bronfman as a business partner. Bronfman liquor was purchased in massive quantities by many crime lords who still live on in American legend, including Charles “Lucky” Luciano, Moe Dalitz, Abner “Longy” Zwillman and Meyer Lansky.

Most of Bronfman’s mob associates during Prohibition were members of what became known as the National Crime Syndicate, which a 1950s Senate investigative body known as the Kefauver Committee described as a confederation dominated by Italian-American and Jewish-American mobs. During that investigation, some of the biggest names in the American mafia named Bronfman as a central figure in their bootlegging operations. The widow of notorious American mob boss Meyer Lansky even recounted how Bronfman had thrown lavish dinner parties for her husband.

Years later, Samuel Bronfman’s children and grandchildren, their family’s ties to the criminal underworld intact, would later go on to associate closely with Leslie Wexner, allegedly the source of much of Epstein’s mysterious wealth, and other mob-linked “philanthropists,” and some would even manage their own sexual blackmail operations, including the recently busted blackmail-based “sex cult” NXIVM. The later generations of the Bronfman family, particularly Samuel Bronfman’s sons Edgar and Charles, will be discussed in greater detail in Part II of this report.

Lewis Rosenstiel’s dark secret

Crucial to Bronfman’s Prohibition-era bootlegging operations were two middlemen, one of whom was Lewis “Lew” Rosenstiel. Rosenstiel got his start working at his uncle’s distillery in Kentucky before Prohibition. Once the law banning alcohol was in force, Rosenstiel created the Schenley Products Company, which would later become one of the largest liquor companies in North America.

Though he was a high school drop-out and not particularly well-connected socially at the time, Rosenstiel happened to have a “chance” meeting with Winston Churchill in 1922 while on vacation in the French Riviera. According to the New York TimesChurchill “advised him [Rosenstiel] to prepare for the return of liquor sales in the United States.” Rosenstiel somehow managed to secure the funding of the elite and respected Wall Street firm Lehman Brothers to finance his purchase of shuttered distilleries.

Officially, Rosenstiel is said to have built his company and wealth after Prohibition, by following Churchill’s advice to prepare for Repeal. However, he was clearly involved in bootlegging operations and was even indicted for bootlegging in 1929, though he evaded conviction. Like Bronfman, Rosenstiel was close to organized crime, particularly members of the mostly Jewish-American and Italian-American mob alliance known as the National Crime Syndicate.

Subsequent New York state congressional investigations would allege that Rosenstiel “was part of a ‘consortium’ with underworld figures that bought liquor in Canada [from Samuel Bronfman]”, whose other members were “Meyer Lansky, the reputed organized crime leader; Joseph Fusco, an associate of late Chicago gangster Al Capone and Joseph Linsey, a Boston man Mr. Kelly [the congressional investigator testifying] identified as a convicted bootlegger.” Rosenstiel’s relationship with these men, particularly Lansky, would continue long after Prohibition and Samuel Bronfman, for his part, would also maintain his mob ties.

In addition to his friends in the mob, Rosenstiel also cultivated close ties with the FBI, developing a close relationship with longtime FBI Director J. Edgar Hoover and making Hoover’s right-hand man and longtime assistant at the FBI, Louis Nichols, the Vice President of his Schenley empire in 1957.

Despite their similar backgrounds as bootlegger barons turned “respectable” businessmen, Bronfman’s and Rosenstiel’s personalities were drastically different and their relationship was complicated, at best. One example of the dissimilarities between North America’s top liquor barons was how they treated their staff. Bronfman was not necessarily known for being a cruel boss, whereas Rosenstiel was known for his erratic and “monstrous” behavior towards employees as well as his unusual practice of bugging his offices in order to hear what employees said about him when he wasn’t present.

Lewis Rosenstiel Roy Cohn

Rosenstiel was connected to both the FBI and to organized crime

Such differences between Bronfman and Rosenstiel were also reflected in their personal lives. While Bronfman married only once and was loyal to his wife, Rosenstiel was married five times and was known for his relatively closeted bisexual antics, a part of his life that was well-known to many of his close associates and employees.

Though for years there were only hints to this other side of the controversial businessman, details emerged years later during a divorce proceeding brought by Rosenstiel’s fourth wife, Susan Kaufman, that would back the claims. Kaufman alleged that Rosenstiel hosted extravagant parties that included “boy prostitutes” that her husband had hired “for the enjoyment” of certain guests, which included important government officials and prominent figures in America’s criminal underworld. Kaufman would later make the same claims under oath during the hearing of the New York’s State Joint Legislative Committee on Crime in the early 1970s.

Not only did Rosenstiel organize these parties, but he also made sure that their venues were bugged with microphones that recorded the antics of his high-profile guests. Those audio recordings, Kaufman alleged, were then kept for the purpose of blackmail. Though Kaufman’s claims are shocking, her testimony was deemed credible and held in high regard by the former chief counsel of the Crime Committee, New York Judge Edward McLaughlin, and committee investigator William Gallinaro and aspects of her testimony were later corroborated by two separate witnesses who were unknown to Kaufman.

These blackmail “parties” offer a window into an operation that would later become more sophisticated and grow dramatically in the 1950s under Rosenstiel’s “field commander” (a nickname given by Rosenstiel to an individual to be named shortly in this report). Many of the people connected to Rosenstiel’s “field commander” during the 70s and 80s have again found their names in the press following the recent arrest of Jeffrey Epstein.

The “Untouchable” Mobster

Bronfman and Rosenstiel became legendary in the North American liquor business, in part due to their fight for supremacy in the industry, which the New York Times described as often erupting “into bitter personal and corporate battles.” Despite their dueling in the corporate world, the one thing that united the two businessmen more than anything else was their close connection to American organized crime, particularly renowned mobster, Meyer Lansky.

Lansky is one of the most notorious gangsters in the history of American organized crime and is notable for being the only famous mobster that rose to notoriety in the 1920s that managed to die an old man and never serve a day in jail.

Lansky’s long life and ability to avoid prison time was largely the result of his close relationships to powerful businessmen like Bronfman and Rosenstiel (among many others), the Federal Bureau of Investigation (FBI) and the U.S. intelligence community as well as his role in establishing several blackmail and extortion rings which helped him keep the law at arm’s length. Indeed, when Lansky was finally charged with a crime in the 1970s, it was the Internal Revenue Service that brought the charges, not the FBI, and he was charged with and acquitted of tax evasion.

Lansky was remarkably close to both Bronfman and Rosenstiel. Bronfman regularly threw “lavish dinner parties” in Lansky’s honor both during and after Prohibition. These parties were remembered fondly by Lansky’s wife, and Lansky, in turn, did favors for Bronfman ranging from exclusive protection of his shipments during Prohibition to getting him tickets to coveted “fight of the century” boxing matches.

Rosenstiel also threw regular dinner parties honoring Lansky. Susan Kaufman, Rosenstiel’s ex-wife, claimed to have taken numerous pictures of her ex-husband and Lansky socializing and partying together, photos that were also seen by Mary Nichols of The Philadelphia Inquirer. In addition, Lansky, per Kaufman’s recollection, was one of the individuals that Rosenstiel sought to protect from legal scrutiny as part of his child prostitution and blackmail ring targeting high-ranking officials, and he was overheard saying that if the government “ever brings pressure against Lansky or any of us, we’ll use this [a specific recording taken at one of the “parties”] as blackmail.”

Lansky was known to address Rosenstiel as “Supreme Commander,” a title that would later be used to refer to Rosenstiel by another individual deeply connected to the mob and sexual blackmail operations, previously referred to in this report as Rosenstiel’s “Field Commander.”

Lansky also had close ties to the CIA and U.S. military intelligence. During World War II, Lansky –along with his associate Benjamin “Bugsy” Siegel — worked with Naval intelligence in what was codenamed “Operation Underworld,” an operation that the government denied for over 40 years.

Journalist and noted chronicler of CIA covert activities, Douglas Valentine, noted in his book The CIA as Organized Crime: How Illegal Operations Corrupt America and the World that the government’s cooperation with the mafia during World War II led to its expansion after the war and set the stage for its future collaboration with U.S. intelligence.

According to Valentine:

Top government officials were also aware that the government’s Faustian pact with the Mafia during World War II had allowed the hoods to insinuate themselves into mainstream America. In return for services rendered during the war, Mafia bosses were protected from prosecution for dozens of unsolved murders. […]

The Mafia was a huge problem in 1951 [when the Kefauver Committee was convened], equivalent to terrorism today. But it was also a protected branch of the CIA, which was co-opting criminal organizations around the world and using them in its secret war against the Soviets and Red Chinese. The Mafia had collaborated with Uncle Sam and had emerged from World War II energized and empowered. They controlled cities across the country.”

Indeed, the CIA forged ties with Lansky not long after its creation at the behest of CIA counterintelligence chief James J. Angleton. The CIA would later turn to the Lansky-linked mob in the early 1960s as part of its consistently fruitless quest to assassinate the Cuban leader, showing that the CIA maintained its contacts with Lansky-controlled elements of the mafia long after the initial meeting with Lansky took place.

The CIA also had close connections to associates of Lansky, such as Edward Moss, who did public relations work for Lansky and was said to be of “interest” to the CIA by the agency’s then-inspector general J.S. Earman. Harry “Happy” Meltzer was also another Lansky associate that was a CIA asset and the CIA asked Meltzer to join an assassination team in December 1960.

In addition to the CIA, Lansky was also connected to a foreign intelligence agency through Tibor Rosenbaum, an arms procurer and high-ranking official in Israel’s Mossad, whose bank – the International Credit Bank of Geneva – laundered much of Lansky’s ill-gotten gains and recycled it into legitimate American businesses.

Meyer Lansky Roy Cohn Israel

Lansky outside the High Court of Israel where he sought permission to emigrate in 1972. Photo | AP

Journalist Ed Reid, author of the Virginia Hill biography The Mistress and the Mafia, wrote that Lansky was attempting to entrap powerful people through sexual blackmail as far back as 1939. Reid contends that Lansky sent Ms. Hill to Mexico, where his West Coast connections had established a drug ring that later involved the OSS, the forerunner to the CIA, to seduce numerous “top politicians, army officers, diplomats and police officials.”

Eventually, Lansky was credited with obtaining compromising photos of FBI director J. Edgar Hoover sometime in the 1940s, which showed “Hoover in some kind of gay situation”, according to a former Lansky associate who also said that Lansky had often claimed, “I fixed that sonofabitch.” The photos showed Hoover engaged in sexual activity with his long-time friend, FBI deputy director Clyde Tolson.

At some point, these photos fell into the hands of CIA counterintelligence chief James J. Angleton, who later showed the photos to several other CIA officials, including John Weitz and Gordon Novel. Angleton was in charge of the CIA’s relationship with the FBI and Israel’s Mossad until he left the agency in 1972 and, as was recently mentioned, he was also in contact with Lansky.

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