Ex-mobster going before gambling study panel

Wednesday, Sept. 9, 1998 | 10:44 a.m.

The casino industry is bracing for explosive testimony Thursday from a former Chicago mobster who turned government witness when the National Gambling Impact Study Commission convenes its fifth hearing on the road in Biloxi, Miss.

William Jahoda, who ran illegal gambling operations for the Chicago mob before "rolling over" on his associates in 1989, is listed as a speaker under the alias Bobby Jay, of the Portland-based Americans Against Organized Gambling.

Timothy Kelly, the nine-member federal commission's acting executive director, refused to say Tuesday whether Jahoda is coming to testify.

"If a witness requests that we use an alias, then we certainly respect that request," Kelly said.

But William Cash, director of public services for Americans Against Organized Gambling, a group that strives to alert college students about the dangers of sports betting, confirmed that Jahoda indeed plans to go to Biloxi.

"He's going to honor his commitment," Cash said Tuesday. "He'll be there early."

Cash said Jahoda makes about 10 speeches a semester on campuses around the country for his group.

In September 1995, Jahoda created a stir in Washington when he testified behind a screen under heavy guard about the evils of gambling during a House Judiciary Committee hearing on legislation that created the federal gaming commission.

"Organized gambling, whether licensed or illegal, manufactures nothing except smoke, false promises and hard dollars at the expense of the unwary," Jahoda told the judiciary panel.

His testimony caught the casino industry and Nevada's congressional delegation by surprise. At the time, then-Rep. Barbara Vucanovich, R-Nev., charged that Judiciary Chairman Henry Hyde, R-Ill., had allowed Jahoda's appearance to turn the hearing into a "three-ring circus."

Jahoda's planned testimony in Biloxi is likely to draw fire from the casino industry, which already has voiced concern that the federal commission has stacked the deck with anti-gaming witnesses this week.

Also scheduled to testify in Biloxi is Terrence Brunner, executive director of the Better Government Association in Chicago, a longtime opponent of legalized gambling in the Chicago area.

On Friday when the commission moves to New Orleans, Edward Galanek, a New York detective who's an expert on illegal sports betting and organized crime, is among those expected to address the panel. Galanek plans to discuss how illegal bookmakers use Nevada's legitimate sports books to further their street operations.

Jahoda, meanwhile, has not been shy about speaking out against gambling, but he has been circumspect before addressing groups.

In a January 1997 Chicago Tribune story, he was quoted as saying he likes to "come in under the radar" when making public appearances.

He said he once used the Bobby Jay alias during a talk at the University of Maryland.

The Tribune reported that Jahoda's federal protection ended in the fall of 1996 after his three-year term of probation for tax fraud and racketeering expired. He now is said to live on his own under a new identity given to him by the government.

Frank Fahrenkopf, president of the Washington-based American Gaming Association, questioned Tuesday why the federal gaming commission appeared to be "going through the charade" of letting Jahoda use an alias.

Fahrenkopf said he doesn't believe Jahoda's testimony would hurt the casino industry.

"Jahoda is old news," Fahrenkopf said. "What he testifies to is illegal gambling, not legal gambling."

Fahrenkopf said Jahoda testified on Capitol Hill three years ago that there is no connection between organized crime and today's casino industry.

But Tom Grey, executive director of the National Coalition Against Legalized Gambling, suggested the industry should be worried about what Jahoda might have to say.

"My reading of it is that if he's coming, the gambling people will really have something to whine about," Grey said.

"I wouldn't want someone from the mob coming in and talking about that product. There'll be wailing and the gnashing of teeth in the casino board rooms."