The following is from the Chicago Tribune:
Long before iPhones, cops battled phone use in fight against gambling
It’s probably safe to assume that shortly after man first harnessed the power of fire, someone committed the first act of arson. And so it has gone with every great innovation in history. Great leaps of technology usher in new crimes, which require new laws that unleash new struggles over enforcement.
The invention of the telephone in 1876 marked a new telecommunications era that eventually changed virtually everything, from business transactions to warfare and romance. And, of course, crime. In 1904, Chicago got an early taste of how the competing interests of security and privacy would start to play out for law enforcement and the telecom industry — in an episode with echoes of today’s dispute between Apple and theFBI, over information that might be gleaned about the attack in San Bernardino, Calif.
At the turn of the 20th century, telephones were still a novel technology and gambling — not terrorism — was a top police priority. Chicago police and city officials trying to stop illegal gambling faced off with the Chicago Telephone Co. over issues of security and privacy.
Of course, telephones in 1904 were primitive compared with today’s smartphones. There was nothing smart about them, and they were dependent on human operators to connect calls. But telephones were already revolutionizing how people communicated. It was easier than ever to convey information in an instant across great distances.
So it was only natural that Chicago’s “poolrooms” — illegal establishments where people wagered on horse races — used telephones as well as telegraph tickers to get the latest race results.
For years, critics had accused city officials, including Mayor Carter Harrison Jr., of turning a blind eye to gambling. Amid mounting criticism in 1904, Harrison acknowledged the harm caused by gambling addiction. “The craze for ‘playing the ponies,’ as the slang phrase goes, has not only captured the regular sporting element, but has spread to clerks, newspaper men and public officials, very often with ruinous results,” he wrote in a letter to the editor to a St. Louis newspaper. “Even women and girls seem to have become infected.”
That March, the police launched a crackdown, with Assistant Chief Herman Schuettler leading a special squad of plainclothes officers. They quickly zeroed in on telephones, seeing them as a criminal tool.
In one raid reported by the Tribune, officers burst into a poolroom above the Illinois Cafe on Wabash Avenue near Jackson Boulevard. They found racing sheets, but the rooms were deserted. A telephone on the wall was ringing. A detective picked up the receiver and heard a voice on the other end saying: “I’d like to put $15 on Mauser in the fifth race at New Orleans. Will I have time to get my money over to you?”
“Keep your money,” the cop said, tearing the phone out of the wall.
City officials criticized the Chicago Telephone Co. (part of American Telephone & Telegraph Co.’s Bell network) for allowing gamblers to use phone lines.
“We have no means of ascertaining whether these parties are using the wires for gambling purposes,” the company’s general manager, Angus Hibbard, told a reporter for the Chicago Record-Herald. “We could not establish a system of espionage that would show the purposes to which each wire is put.” Another company official remarked, “How can we tell if these places are illegal? If they are illegal the authorities should close them.”
Ald. Joseph Badenoch did not buy their argument, pointing out that the phone company’s contracts forbade customers from using foul or profane language. (Whether that was constitutional or enforceable didn’t seem to trouble him.) Badenoch wondered: If the telephone company could prohibit cussing, why couldn’t it prohibit gambling?
A lawyer for the city said the police had the right to confiscate or destroy any phones being used for illegal purposes. “Any lawful instrument, when used for unlawful purposes, becomes unlawful,” William Sexton, the city’s assistant corporation counsel, told a Tribune reporter. Telephones used by gamblers were “pure gaming devices,” Sexton explained. “An officer could go into one of these shops and wreck the machine, or walk out with it if he is strong enough to snap the wires.”
And Sexton suggested that the phone company should listen in on calls to check for illegal behavior. “The plea of the company that it doesn’t know to what use its wires are put is ridiculous,” he said. “It has the means of knowing, and yet when you pick up a party line telephone these days you don’t know but what you are going to be interrupted by someone speaking from a disreputable resort. That happened to me a few days ago.” (“Resort” was a common term in the early 1900s for brothels and similar dives.)
Schuettler ordered his men to disconnect all telephones they found in gambling houses, but the phone company objected.
“It is a statutory offense for anyone to interfere with the apparatus of either telegraph or telephone companies,” Arthur Wheeler, the phone company’s president, told the Tribune. And in a letter to the mayor, Wheeler rejected the idea of eavesdropping. “No anxiety to better a lawless condition will justify lawless measures,” he wrote.
Harrison called Wheeler a “pettifogger,” complaining that the company was putting profit above the public good. “They want no reform that touches their own wallets,” he told the Tribune.
At the same time, Chicago was putting pressure on Western Union Telegraph Co. to stop selling racing results. In a surprise, the company agreed. And eventually, Chicago Telephone Co. and the city reached a detente. The city didn’t press the idea of forcing the phone company to eavesdrop on gamblers’ calls. And the company didn’t object when the police tore out telephones in gambling establishments.
During the gambling crackdown of 1904, police tore out 280 telephones and 15 ticker machines. Chicago’s gambling syndicate began using boys as messengers instead of telephones to spread information on races and wagers, but business plummeted. Betting in Chicago on horse races reportedly fell from $400,000 a day to just $3,500.
It turned out to be just a temporary downturn. “The gamblers are just hibernating,” Schuettler presciently remarked in a December 1904 Tribune story. “They are not in caves, but they bide their time in secret places, ready to spring into activity the moment the police relax their vigilance.”