Gangsters in America – Caspar Holstein – The King of Harlem Politics
He was considered a genius; a compassionate man who gave freely to the poor. But Caspar Holstein made his fortune in the Harlem numbers game of politics, which he helped invent.
Casper Holstein was born on December 7, 1876 in St. Croix, Danish West Indies. His parents were of mixed African and Danish descent, and his father’s father was a Danish officer in the Danish colonial West Indies militia. The Holstein family moved to New York City in 1894. An extremely bright child, Holstein graduated from high school in Brooklyn, no small accomplishment for a black man before the turn of the century. After graduation, he enlisted in the Navy and, during World War I, visited his homeland, which was then known as the Western Virgin Islands.
When Holstein was discharged from the Navy, he worked various odd jobs, including as a doorman in an Upper East Side building. He also became a personal assistant to a wealthy white couple, and years later, after he made his fortune and they lost theirs, Holstein supported this couple and then paid for his funeral.
Seeking better himself, Holstein wandered to Wall Street, where he landed a job, first as a messenger, then as chief messenger, for a Wall Street commodity brokerage firm. Holstein fell in love with gambling, especially horses, but he also dabbled in the stock market, examining daily figures from the Boston and New York City Clearing Houses. One day, Holstein came up with an idea that would drastically improve his situation. He knew that people in black neighborhoods like Harlem loved to gamble, but most didn’t have enough extra money to do so. When he saved up enough money to start his company, Holstein devised a scheme where people could bet as little as a penny on a random set of three-digit numbers, which would appear daily in New York City newspapers.
Using figures from the Boston and New York City Clearing House, Holstein took two middle digits of the New York number and one middle digit of the Boston number. So if the totals for the two clearinghouses were 9,456,131 and 7,456,253 respectively, the winning number would be 566; where “56” is the two digits before the last comma of the first figure, and “6” is the last digit before the last comma of the second figure. This system was so random that it couldn’t be tampered with, as it would be later, when gangster Dutch Schultz got into the Harlem numbers business and started using racing figures, which he in fact tampered with. In the early 1920s, the Holstein system was all the rage in Harlem. Holstein became known as the “King Pellet”, earning approximately $5000 per day.
Using his newfound wealth, Holstein generously contributed to worthy causes. He gave huge amounts of cash to St. Vincent Sanitarium, the Garvey nationalist movement, and financed Opportunity magazine’s literary awards, which discovered much of Harlem’s young talent. Holstein built dormitories in black colleges and financed many of Harlem’s artists, writers, and poets. He also helped start a Baptist school in Liberia and established a hurricane relief fund for his native Virgin Islands. The New York Times said Holstein was “Harlem’s favorite hero, because of his wealth, his sporting inclinations, and his philanthropy among people of his race.”
Seeing how Holstein and Stephanie St. Clair had turned Harlem into a financial bonanza due to their numbers deals, gangster Dutch Schultz barged in and took over their games. So. Schultz had great politicians, including the disgraced Jimmy Himes in his back pocket. Schultz also bought off the police and killed black number runners en masse. Schultz eventually forced St. Clair to work for him, but Holstein turned down Schultz’s offers to consolidate his numbers business.
In 1928, Holstein was kidnapped for a ransom of $50,000 by five white gangsters, whom the Harlem public assumed to be thugs sent by Schultz. News of the Holstein kidnapping made national headlines. The New York Times reported that Holstein had been seen at Belmont Racetrack just days before he was kidnapped, betting more than $30,000 on ponies. Holstein was released after three days in custody, insisting that he did not pay ransom. His explanation was that his captors felt sorry for him and released him with a $3 cab fare.
However, Holstein’s story carried little weight, as he soon reduced his political activities. A few years later, Holstein completely stopped trading him on the street and operated only as a best firing. In 1935, even though he was barely gambling, Holstein was arrested for illegal gambling. He was tried and convicted, and spent a year in prison. Holstein claimed that he was framed, possibly by Schultz, but spent his time in jail without incident. When he got out of prison, Holstein got into the real estate business, providing mortgages for people in Harlem who were avoided by regular banks.
Casper Holstein died on April 5, 1944, at the age of 68. More than 2,000 people attended his funeral at the Harlem Memorial Baptist Church. A scholarship at the University of the Virgin Islands and a housing development on St. Croix are named in Holstein’s memory.