Dark Rose: Organized Crime and Corruption in Portland

Epilogue: The Fallout

145 E ePilogue The Fallout The 1957–1960 McClellan Committee hearings had tremendous political and social impact on Portland. Top officials were indicted, law enforcement was branded corrupt all the way from the police chief and county sheriff through the city’s district attorney, and clear connections to organized crime were laid bare. But the close of the committee hearings did not bring an end to turmoil in Portland. Many local citizens rejected the federal McClellan hearings as a witch hunt, though state investigations and prosecutions had been ongoing ever since the Oregonian exposed the vice scandal in 1956. Additional allegations were made and the two daily newspapers warred over which one was more accurate and forthcoming about the scandal. When Mayor Terry Schrunk returned to Portland in March 1957, after having refused to testify further before the McClellan Committee, he surrendered to state authorities. Following his federal testimony, the mayor’s indictment for bribery was amended to include a charge that in 1956 he lied to a state grand jury when it was investigating Portland’s vice scandal.1 The trial jury heard opening arguments in the Schrunk case in June 1957. Prosecutors 146 ePilogue called twenty-three witnesses, including James Elkins. The racketeer , still under indictment himself, testified that his bankroll for the 8212 Club was short $500 the morning after the alleged payoff to Schrunk. Elkins told the jury, however, that he knew nothing more about Schrunk accepting bribes other than what 8212 Club manager Clifford Bennett had told him.2 This statement is false according to numerous sources. The Oregonian reported that Elkins admitted to nurturing a business relationship with Schrunk in which Elkins supported Schrunk politically in exchange for Schrunk preventing any police action from hindering his vice activities. Elkins later testified , and an Oregon State Police report corroborated, that on one occasion in 1955 he visited the sheriff’s department in response to a call from Schrunk requesting that the racketeer contribute money and whiskey to an upcoming law enforcement convention. Deputy Sheriff Elmer Wallen corroborated Elkins’s testimony. According to Wallen, Schrunk asked the deputy to help organize the convention finances, and Wallen collected contributions from Elkins and other local racketeers, including Stanley Terry and north Portland racketeer Tom Johnson.3 Despite strong evidence that he had ties to Elkins, Schrunk presented a strong defense during the subsequent trial. His lawyers built their case around the theory that the mayor was the target of a conspiracy led by James Elkins and the Oregonian newspaper. During the Schrunk trial, the state prosecutor delivered a surprise witness to challenge Schrunk’s solid defense. On June 26, much to the astonishment of everyone in the courtroom, Robert Kennedy appeared in the Multnomah County courtroom. The first thing that Kennedy told the court was that both Oregonian reporter Wallace Turner and racketeer James Elkins tried to discourage him from investigating Schrunk. “Mr. Turner and Mr. Elkins said at that time,” Kennedy testified, “that they thought it would be a mistake to go into it . . . that we had been going along well as we were and that to get into somebody as big as Mayor Schrunk, they did not think it advisable.” Kennedy claimed that he then told Turner ePilogue 147 and Elkins that he was interested only in the facts and did not care who was involved.4 “Terry [Schrunk] was not one of the people we were after,” Wallace Turner later explained. The primary targets of the Oregonian reporters’ exposé were the corrupt Teamsters union officials and District Attorney William Langley, who had used their positions for their own personal financial gain. Back in Washington , D.C., however, Kennedy told Turner, “One of us is the Chief Counsel of the Select Committee and one of us is not, and we’re going to call Schrunk,” meaning that Schrunk would be compelled to testify about his relationship with Portland vice racketeers and corrupt Teamsters officials.5 Disgruntled union members praised the Senate’s investigation in letters that flooded the nation’s capital. “I am happy to see that the United States Government is finally beginning to investigate abuse of power by some of the labor ‘unions’ that know they are above the law,” a union member wrote Senator McClellan.6 “Our relationship with the Union has come to the point where we are never even given the courtesy of a discussion of Union demand. The...