Al Capone Trial: 1931

On St. Valentine's Day, 1929, Capone ordered his men to kill "Bugs" Moran, head of the gang that had machine-gunned the Capone headquarters. Masquerading as police officers, Capone's men massacred seven opponents in a downtown warehouse. The people of Chicago were outraged.

Colonel Frank Knox, publisher of the Chicago Daily News, asked newly inaugurated President Herbert Hoover for help. Reportedly, Hoover told Secretary of the Treasury Andrew Mellon, "I want that man in jail."

Federal authorities held jurisdiction over Capone's activities in only two areas: violation of the Volstead Act (i.e., Prohibition) and evasion of income taxes. The problem was proving either case: Capone had never maintained a bank account; he owned no property under his own name; he endorsed no checks; he paid cash for whatever he bought.

Nevertheless, the Internal Revenue Service sent Special Agent Frank J. Wilson to Chicago to analyze Capone's net worth and net expenditures. Over two years, Wilson compiled a list of Capone's purchases, which included custom-made suits, telephone bills, town cars and limousines, a house on Palm Island, Miami, Florida, with two new docks, a boathouse, and an extra garage.

To connect Al Capone with brothels, gambling, and bootlegging, Wilson moved Special Agent Michael F. Malone, who could be taken for an Italian, Jew, or Greek, into Capone's inner circle.

Malone supplied Wilson with inside information. But getting witnesses would not be easy because, as Wilson wrote in a memo:

… all important witnesses were either hostile and ready to give perjured testimony to protect the leaders of their organization or were so filled with fear of the Capone organization … that they evaded, lied, left town and did all in their power to prevent the government using them as witnesses.… To serve them with subpoenas it was necessary to pick them up on the streets near the Capone headquarters, at Cicero hotels and at nightclubs.

Malone identified a potential witness in the Smoke Shop manager who had quarreled with Capone. Though the manager talked very little, he implied that Chicago Tribune reporter Jake Lingle, who knew more about Chicago's gangland than any other reporter, might have information about Capone. Colonel Robert R. McCormick, the publisher, set up a confidential meeting in the Tribune Building. On his way to it, Lingle was murdered.

By 1931, IRS agent Wilson, who had been living with round-the-clock guards after learning that Capone had brought five New York gunmen to Chicago with a contract to kill Wilson, was ready for the grand jury. It returned three indictments: the first for failure to pay 1924 income taxes; the second (with 22 counts) for not paying 1925 through 1929 taxes; the third (based on information compiled by agent Eliot Ness, citing 5,000 specific offenses) for conspiring to violate the Volstead Act. The last was reserved as an ace in the hole.