An investigation of boxing by a U.S. Senate subcommittee reveals that the ex-heavyweight champion was generous to a fault with the kind of friends he was supposed to have given up long ago
April 06, 1964

When the U.S. Senate Subcommittee on Antitrust and Monopoly convened last week to hold a hearing on whether or not boxing should be placed under federal control the initial subject matter seemed relatively mild—an under-the-table rematch contract between Sonny Liston and Muhammad Ali, the former Cassius Clay. But the subcommittee had hardly made itself comfortable in Room 2228 of the New Senate Office Building (known around Washington as the "New SOB") before it discovered that return-bout contracts, illegal or otherwise, were far less fascinating than the fact that stock in Sonny Liston (flourished above by Committee Chairman Philip A. Hart) had sunk to an alltime low. The mikesful of testimony that followed indicated Liston had done a lot of things while he was heavyweight champion but one of them was not—alas—ridding himself of the peculiar battalion of mobsters, gamblers, front men and hangers-on that supposedly had been purged from the boxing scene three years ago. Though Sonny may have seemed to live a pristine and lonely life in the high, pure air of Denver, breaking only an occasional law late at night, he was actually a man with friends galore, friends that ranged from fetid Philadelphia to virtuous Las Vegas, gambling friends and advising friends, above all, the kind of friends a man would be happy to share his money with.

Like a heavyweight fight, the hearing began slowly enough as Senator Hart and his associates poked and prodded at the rematch contract that the former Clay signed with Intercontinental Promotions before he whipped Liston, the former No. 63723 of the Missouri State Penitentiary. The Senators had difficulty grasping the idea that rematch contracts have been SOP between heavyweight champions since Achilles took on Hector, and that the World Boxing Association, which piously forbids such contracts, is mostly a grab-bag collection of political clinks and clanks who would joyously become Black Muslims themselves if it meant a title fight for the old home town. As Garland Cherry, the lawyer for Intercontinental and the first day's witness, facetiously announced to an elevator full of people upon leaving one session, "Thank God the reporters weren't up there asking the questions. Then we would have been in trouble."

But trouble came fast enough as names suddenly began dropping—old, familiar, nasty names and new, unknown, enticing names. Fingered so far—and the chorus is not through singing yet—have been Frankie Carbo, the onetime underworld czar of boxing who is now doing 25 years in a federal pen for extortion; Blinky Palermo, Carbo's former buddy who is appealing a 15-year stretch on the same rap in an effort not to wind up as a pen pal; and Pep Barone, a Palermo stooge who used to manage Liston and who is still regarded by Sonny as a lucky charm. Then there were the new names: Ash Resnick, who is, as Jack Nilon, Liston's current manager, testified, "believe it or not" the athletic director of a Las Vegas gambling joint; Salvatore J. Avena, a little-known but soon to be better-known lawyer from Camden, N.J.; and Sam Margolis, a Philadelphia man of parts who used to run a delicatessen with Blinky and who now (surprise!) turns out to own half of Liston's stock in Intercontinental Promotions, stock said to be worth $100,000 that generous Sonny insisted on giving him.

Margolis is the key man, and an interesting one. Pudgy and 50, he pleaded guilty in 1937 to operating a gambling house in Chester, Pa., was fined $50 and sentenced to from one to three months in jail. In the early 1940s he was twice arrested on gambling charges in Delaware County, Pa., but not found guilty either time. In 1950 Philadelphia police arrested him for assault and battery, but he was discharged again. Over the years he has been chums with Blinky Palermo and other Blinky buddies. In 1960 Anthony Bernhard, an undercover detective for the New York police, told the monopoly subcommittee, then headed by the late Estes Kefauver, that Margolis had been present at a 1958 Washington meeting between Palermo and Carbo, which pinpoints Margolis as a man who knows boxing's ins, if not its outs. (Senator Kenneth Keating of New York pointed out last week that Angelo Dundee, the trainer for Clay, also attended the same little soiree, and the Senator wondered aloud if Carbo did not now, even by remote control from his cell on McNeil Island in Puget Sound, have an interest in both the Clay and Liston camps? This speculation created a rustle of headlines, though there was no reason to believe that the group of 11 Louisville businessmen who handle Clay could be controlled by the mob. They pay Dundee a flat salary to train Clay at his famous Fifth Street Gym in Miami Beach—see page 70.)

There was nothing speculative about Sam Margolis' lasting friendship with Blinky Palermo. A check last week of police records in Los Angeles, where Palermo and Carbo were tried for extortion in 1961, showed that Margolis was a constant spectator in the courtroom. Moreover, a look at the visitor's book in the L.A. County Jail revealed that Margolis frequently signed in to comfort Blinky in his time of trial. Margolis and Blinky had long been in business together in Philadelphia as partners in the Sansom Delicatessen at 111 South 39th Street. Until 1961 Margolis and his wife reportedly owned 50%, and the other 50 was split up between Blinky and members of his family. Geraldine Liston, Sonny's wife, may even have sliced a few pickles at the deli—at least she gave her occupation as a cook at the Sansom when she and Sonny applied for a car loan in 1960. Margolis is now in the vending machine business—an enterprise he apparently runs from his home.

The question, of course, is how did Margolis turn up owning 225 of Sonny's 500 shares in Intercontinental Promotions? Margolis claims that Liston gave him the stock last fall because he, Sam, helped set up Intercontinental by getting Liston and the Nilon brothers together. That would make it a kind of finder's fee of unprecedented proportion, and the Senators understandably decided that they wanted to hear Margolis explain what he was finding—and on behalf of whom. They also expressed interest in Lawyer Avena, who fell heir to 50 shares of the stock. Both men have been asked what moved Sonny to give away almost three-fifths of himself in payment for services of a highly vague nature.

If Avena had anything to say in the matter, he was saving it for the hearing. He did confirm that Margolis was his client, yet he refused to say how he—supposedly just another Camden lawyer, though one who certainly has some unique connections—latched on to Philadelphia Sam. "I won't go into details about what I was handling for Mr. Margolis," he said. He said that he had met Liston through Margolis, and that when the Nilon brothers and their lawyer, Cherry, decided to set up Intercontinental "Sonny asked me to represent him." In any event, as a fee for advice given to Client Liston, Avena picked up 50 shares.

The names of Margolis and Avena first came up when Cherry testified, but the star witness last week was Sonny's harassed "adviser," Jack Nilon, the very man who took over Liston in 1962 to show the world that the Palermos and Carbos were things of the past. When Margolis asked Cherry last fall to turn the chunk of Sonny's stock over to him, Cherry rang up not Liston, but Adviser Nilon, for approval. Sonny's generosity shocked him, Nilon testified. He said he went to Sonny and tore a dollar bill into four pieces to impress Liston with what he was giving up. Sonny was not impressed. But in the witness chair Nilon, who has been feuding with Sonny, saw little wrong with the stock deal. "Personally," he told the Senators, "I feel anyone who can put up with Mr. Liston's antics—even if he got the whole thing—would be underpaid." The Senators never did ask Nilon why he thought Sonny gave up the stock, but later, when a reporter did, Nilon replied, "I don't need to ask questions. I've got an imagination."

Nilon said, in so many words, that Sonny is personally obnoxious, and he went on to give some revealing behind-the-punching-bag insights into Liston's training for the Clay fight. As a matter of fact, Nilon said he had planned to quit as manager after the Clay fight even though there was money to be made. "There is more to life than bread," Nilon declaimed. Nilon's gross take from the Liston fight could be as high as half a million dollars, prompting Senator Hart to remark, "There's a lot of bread in that life." But when Liston lost, Nilon added, "I didn't think it was right to walk away from him." Liston, Nilon declared, "is almost a neurotic. In Las Vegas he steps on a stone. You might have thought he had a broken leg. In Florida he had a cold, he was dyin'." When Liston arrived in Miami Beach to train for the Clay fight, Nilon said he had to bring in Dr. Robert Bennett from Detroit to attend to Sonny's ailments, real or imaginary.

Besides this, Nilon went on, "I didn't feel Sonny trained as hard as he could. He was doggin' it. He was readin' his press clippings." Nilon said he told Liston that Clay was a fast kid who could run, but Sonny only got angry. For most of the training period he and Sonny were "at odds." Instead of running five miles, Sonny would only do one and—sin of sins for a champ in training—he took to "stayin' up late, playin' cards and so on." The Senators did not pursue the so on. There was certainly nothing in the testimony last week to indicate that Liston gave anything but his huffing-and-puffing best once the fight with Clay actually began.

Life at Liston's house, which Nilon visited only once, was "chaos" "It was like a ballroom," he testified, with hangers-on galore. Asked to name them, Nilon flung his hands up in disgust and exclaimed, "Beeewwww!" Pressed for specifics, he cited, among others, Martha and Joe Louis (besides Avena, Liston has Martha Louis as a lawyer, but then, as Nilon quipped of Sonny, "He's got lawyers on lawyers"), Sam Margolis and Pep Barone, the Palermo front man who once was a link in Sonny's managerial chain. "Sonny," said Nilon, "thinks an awful lot of Pep Barone." Indeed, Sonny thought so much of him that he invited him to Miami Beach. "He thinks Pep Barone's good luck," Nilon said, by way of possible explanation. "Sonny's very superstitious."

Back in 1960, when Senator Kefauver told Sonny to divest himself of mob management, Sonny was supposed to buy his contract back from Barone for $75,000. But, as Nilon told it, Barone has not been paid in full. While in Florida, Barone griped that he was still owed $42,000, and after the Clay fight Nilon gave Pep a check for $3,000 or $4,000 (Nilon could not remember the exact figure) which he charged to Liston's account (that Nilon remembered) because Barone "didn't have any money to get out of Miami."

"That," interjected Senator Keating, "would get him quite a way out."

Another camp follower in Liston's house of chaos was Ash Resnick, a gambler and the athletic director for the Thunderbird Hotel in Vegas. "I don't know what they call athletics," said Nilon, who clearly loathed Resnick. Nilon said that, according to "hearsay" (Do you want hearsay. Senators? Nilon asked. You betcha, they replied), Resnick had bet on the Liston-Clay fight, and "lost everything." The one thing Resnick did not lose was the publicity value of the shirts with Thunderbird written on them that he had talked Liston into wearing.

By the weekend the Senators had clearly heard enough to want to ask a lot more questions. Was Sam Margolis going to have an explanation for Sonny's generosity? Was it just a wild coincidence that Liston's new shareholder turned out to be an old business partner of Blinky Palermo's and no stranger to Frankie Carbo? Called to testify on Monday, Margolis made it seem as though everything was just wild coincidence. "Under penalty of perjury," he vowed, "I deny that they [Palermo and Carbo] have any interest [in Liston]." Sonny, Margolis claimed, had any number of reasons for giving him the stock. He, Sam, had helped set up the Intercontinental deal, he had let Sonny run up "a big bill" eating on the cuff in the Sansom and, most important, any time Liston had "problems" Sonny had come to him for friendly advice. If Sonny himself is called, he may well have to testify that when you have dear friends like Blinky Palermo and Sam Margolis and Pep Barone, why, you don't give 'em up, man, you don't give 'em up—unless they give you up first.

The last word was still Jack Nilon's. "Well," he said, "we took the heat off Bobby Baker."

PHOTOA stern Senator Hart brandishes the stock certificates that Sonny Liston signed over to a couple of mysterious strangers, Sam Margolis and a lawyer, Salvatore J. Avena. THREE PHOTOSThree men with roles in the curious manipulation of Liston's stock are (left to right) jolly Sam Margolis, jittery Jack Nilon and earnest Garland Cherry. PHOTOAsh Resnick, gambler and Liston camp follower, gets wifely encouragement at earlier inquiry. PHOTOSonny Liston gets managerial encouragement from Barone in days when mob openly had him.

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