01x02 - Build a Better Operation

[bunniefuu]

[narrator] By following

the playbook's opening lessons,

you've maneuvered your way

from the ground floor

to the mob boss penthouse.

Now it's time to focus

on your bottom line.

Vice is commerce.

It's not about morally,

"Oh, it's wrong to deal drugs."

Morally, "It's wrong to run a brothel."

It's business.

It's about grabbing money with both fists.

[narrator]

Reaching your full earning potential

won't happen on its own.

It is absolutely critical

that a mob boss has a business plan.

If there's no plan,

the structure will fall.

[narrator] But by putting your intellect

to work along with your muscle,

you can outfox your competition

and become

the underworld CEO of your dreams.

Just like this guy.

Harlem's superfly heroin tycoon,

Frank Lucas.

Lucas's revolutionary strategy

upended New York's drug trade

creating his own supply chain

that banked more

than a million dollars a day.

I used to sleep in the bed, in the cold.

And then I was

in the big time, and I started rolling.

[narrator] Follow Frank's

cutting-edge business plan,

and you, too, can make sure

that your crimes do pay.

[funk bass playing]

[narrator] Frank Lucas built

a multimillion-dollar

international heroin empire

from the ground up.

All before his 40th birthday.

His goal was to make money selling heroin,

and so he made

a lot of money selling heroin.

[narrator] But before you follow

Frank's path to the C-suite,

here's what you can learn from his rise.

Frank Lucas was born

in rural North Carolina

during the Great Depression.

We have no, no opportunity there

in, uh, segregated North Carolina.

You won't make a good life for yourself

and be able to take care of your family.

He did see his cousin m*rder*d

by a member of the KKK.

They came and blew his brains out.

They stuck the shotgun in his mouth,

pulled the trigger.

[g*nsh*t]

Sometimes certain things

happen in your life, and it change it.

You know, it change it.

And he left, and he came to New York.

[Richie] Now, the problem was

he was illiterate.

He couldn't get a job

delivering a newspaper.

He couldn't do anything.

The only way he could survive

was to get into something ill*gal

where he would be accepted.

So he started selling drugs.

[Ezell] Bumpy Johnson was the baddest

Black gangster probably ever lived.

Bumpy was like a, um like a dad to him.

[Frank] I worked with Bumpy

for that many years.

Thirteen years,

nine months and eight days.

And, uh, every dime I made,

I credit him for it.

You know, I credit him for it.

[Richie] When Bumpy died,

Frank got the drug business.

Frank wanted the drugs

because he thought that that was

where he would make the most money.

Out of seven boys, Frank was the oldest.

He was like my hero.

He'd ask us to do something,

we would do it.

[Richie] He was able to maintain

his control through his brothers.

He trusted his brothers

and made them rich.

Always talks about family, you know.

He just drills it in your head.

"You stick with your family."

[narrator] Frank had

a promising career path

and a loyal inner circle

to help him build his business.

But that didn't mean

everyone respected his authority.

As you launch your enterprise,

how do you prove you've got what it takes?

Nobody fools

with a guy from Harlem, you dig?

[narrator] As a mob boss, the only way

to ensure your operation's success

is to immediately show

the consequences of getting in your way.

First, I'm gonna bash his head to a pulp.

You have to establish yourself

as a k*ller.

It's a real tough industry

where reputation

and street cred is critical.

Yeah!

If you show weakness as a mob boss,

you're not gonna be alive very long.

[narrator] These guys knew how to flex

their muscles right out of the gate.

Shortly after taking over

Boston's Winter Hill g*ng,

Whitey Bulger reportedly sent

a message by k*lling Louis Litif,

a longtime associate

who disobeyed Whitey's orders.

His body was found

mutilated in the trunk of a car.

Albert Anastasia kicked off his reign

by allegedly ordering the m*rder

of salesman Arnold Schuster,

who got on the boss's hit list

for helping police

track down a known fugitive.

And when Griselda Blanco

began ruling the Miami cocaine trade,

she invented a tactic

to keep her adversaries in line,

enlisting motorcycle hit men

called sicarios,

who would perform drive-by assassinations,

usually in broad daylight.

[indistinct chatter]

It wasn't long after Frank Lucas

took over Harlem's heroin business

that his reign was tested.

When you're at the top,

there's always eagles, okay?

There's always maybe somebody,

they start looking at you and figure,

"You know something? I could do this

a little bit better than this person."

"Maybe I should be the leader."

[narrator] You can't afford to let that

sort of insubordination go unanswered.

In 1960s Harlem,

the baddest guy around is Tango.

[Ezell] Tango was a big bully.

Six-foot-five, six-foot-six.

People in Harlem were

kind of fearful of him.

[narrator] Tango is

a freelance heroin dealer

known for shortchanging his suppliers.

[grunting]

It's something new boss

Frank Lucas can't allow.

Frank senses an opportunity

to show who's really in charge

and cut the giant down to size.

When he hears

Tango is looking for more product,

Frank supplies him with a kilo of heroin,

knowing Tango

will ultimately try to stiff him too.

And when Frank comes

to collect two weeks later,

Tango doesn't disappoint.

He refuses to pay Frank a dime

and lashes out, challenging Frank's honor.

And his mother's.

[gasping]

[narrator] A crowd forms,

just as Frank knew it would.

[tense music intensifies]

[g*n c*ck]

[crowd screaming]

[narrator] The message is clear.

Frank knew

to let people know when you are the boss,

that not only

is your finger on the trigger,

but you know how to pull it.

[narrator] That's the sort of reputation

you need to succeed.

But as a mob boss,

your brawn may kick open the door,

but it's your brain

that'll bring in the cash.

Start with this mantra

any wise businessman must follow,

never pay retail.

Kids dream of becoming athletes,

astronauts, or movie stars.

No one ever aspires to become a middleman.

Too bad,

because that's where the money is.

[Lewis] In the heroin business,

the supply chain, it's international.

The middleman is making

a tremendous amount of money

because he's going right to the source.

[narrator] And that's coming out

of your profits.

Let me explain.

While Frank was getting started,

heroin came to the US

through what was called

"The French Connection."

[bell dings]

It started with poppies grown in Turkey.

When the plants matured,

they were harvested for opium sap.

The sap was boiled with lime

to separate the morphine.

Then it was off to France,

where industrious chemists

turned the morphine into heroin.

It's a precise and smelly process.

Next, it was up to the middlemen

from the Corsican Mafia

to move the refined heroin

across the Atlantic to America,

hiding it any way they could.

Now, that's an expensive toaster.

Once the heroin made landfall,

the American mob sold it

at a markup of up to 400%.

Then it hit the streets,

courtesy of domestic dealers

like Frank Lucas.

For the Mafia, this arrangement

made them countless millions.

But for hustlers like Frank,

it was a painfully

inefficient proposition.

Frank wanted to try to figure out,

"How do I cut out the middleman

to maximize my profits?"

And also reduce

the opportunity for law enforcement

to penetrate his organization.

[narrator] Lucas needed a big idea,

which he got from the same place

you're probably getting

this essential content,

television.

[Frank] There used to be

a news broadcast come on.

They used to tell you

about those guys in Vietnam getting high.

[broadcaster] Washington now admits

there is a serious drug problem

among its servicemen in Vietnam.

[narrator] And while some

might only see a crisis,

Frank's mind went to a different place.

Frank saw an opportunity

to bring the heroin in from Asia.

[narrator] Frank's master plan?

Bypass the French Connection

and create his own heroin pipeline

from the Far East.

And luckily, he already had a hookup.

His cousin,

a gentleman named Ike Atkinson,

was a retired Army sergeant in Asia

who was able to make contact

with those who were growing the poppies.

[narrator] But when you're considering

a new business venture,

you need to look before you leap.

[horns honking]

[narrator] Frank travels

to Bangkok, Thailand,

to meet with cousin Ike

who introduces him to his local supplier.

A man Frank dubs 007 for obvious reasons.

007 is willing to sell Frank

over 200 kilos of heroin on the spot

for around a million dollars,

one-tenth of what the Mafia would charge.

Frank eagerly agrees,

and finds a helpful service man

to bring the haul stateside.

This could be the start

of a beautiful relationship.

But Frank needs to make sure

007's operation is up to the challenge.

So he heads into the Thai jungle himself,

hiking for days in the sweltering heat

until finally he reaches

the Promised Land.

[mysterious music plays]

Frank is so impressed,

he buys more product on the spot.

But the return trip hits a snag.

Bandits.

Frank fights alongside the guides.

When the smoke clears,

the bandits are dead.

While Frank's goal

of securing a direct heroin supply,

that's alive and well.

I went in. I got the load.

And came back, and the rest is history.

[narrator] But even if you secure

a direct hookup for your product,

you won't become a top boss

without mastering sales.

How do you keep

your merchandise flying off the shelves?

Anytime your sales volume

isn't up to your full market potential,

whatever the reason, you've got a problem.

[narrator] The playbook solution

to this common dilemma?

Become the only game in town.

[woman] If you corner the market,

you have control over the market.

You can charge whatever the hell you want.

[narrator] It certainly worked

for these guys.

Crime boss Enoch "Nucky" Johnson

used his political connections

to control all of Atlantic City's rackets

during Prohibition,

making half a million dollars a year,

nine million today,

off of ill*gal booze,

prostitution, and gambling.

Philadelphia mob boss Nicodemo Scarfo

cornered the methamphetamine market

by importing and distributing

more than 100 gallons of P2P.

Enough of this key ingredient

to make half a ton

of the highly addictive drug.

And Cheng Chui Ping, known as Sister Ping,

made $40 million over two decades

by becoming the go-to provider

for smuggling migrants

from China to the United States,

earning her the nickname

"The Mother of all Snakeheads."

But Frank Lucas was looking to serve

an even larger

and faster-growing consumer base.

About 50% of the heroin addicts

live in New York City,

and an estimated 80% of the known addicts

in New York City live here, in Harlem.

[narrator] Demand was clearly

not a problem,

but how do you make sure

customers come to you to get their fix?

It starts with marketing.

Like most organizations,

you have a product,

you give it a brand name.

So you want people to look for your brand.

You have to make sure your brand is good.

[narrator] And that its name

grabs people's attention.

Here's some of Frank's competition.

Some of these I recognize.

You want me to read all of them?

Okay.

Mean Machine.

Could Be Fatal.

Taster's Choice.

Harlem Hijack. Joint.

f*ck Me, f*ck You.

d*ck Down.

Oh, Can't Get Enough of That Funky Stuff.

- Payback.

- Tragic Magic.

Nice To Be Nice.

Ding Dong.

OD Correct. Official Correct.

Past Due.

Payback Revenge.

Green Tape. Red Tape. Rush.

They didn't lack

for imagination. [chuckles]

[narrator] But clever branding

only goes so far.

It's what's in the package that counts.

Frank stamped his "Blue Magic,"

and it was the best dope you could buy.

[narrator] Frank's secret sauce?

Most heroin that dealers sold at the time

had purity levels

of just one to three percent.

But Lucas put his customers first,

upping the purity level

to five to seven percent.

They got a better high.

I mean, you know, you can buy a Ford

or you can buy a Cadillac.

I'd rather buy the Cadillac,

and that's what Frank

was selling these people.

[narrator] And when you're selling

a premium and potentially deadly product,

quality control is essential.

Frank made sure his production line

was in the hands of a true expert.

The manufacturing genius

he called Red Top.

Each time Frank receives

a heroin shipment from Asia,

he delivers it to Red Top

who cuts the heroin

with additional substances

to get it street ready.

As demand increases,

Frank hires more staff

and makes these new employees

wear a specific uniform for transparency.

To avoid detection,

Lucas has Red Top frequently shift

the operation around the city.

Sometimes he even reportedly pays off cops

to do the work inside their homes.

But to truly corner the market,

Frank needed something else.

A solid retail strategy.

Studying police behavior,

Frank notices a key pattern.

At 4:00 p.m. daily,

cops on the early shift leave their posts.

But the night shift

doesn't take over until 5:00.

Frank instructs his lieutenants

to hit the streets hard

during this golden hour.

While Frank monitors

his crew's customer service

by cruising through Harlem undercover.

If anybody slips up, there's hell to pay.

[gasping]

[narrator] But when your product

sells this well,

sometimes all you have to do

is sit back and enjoy.

By creating a premium product

and mastering distribution,

Frank had Harlem's heroin market

in the palm of his hand.

At this point, who wouldn't want

to enjoy the fruits of their labors?

But before you start

throwing your money around,

pay close attention

to the playbook's next lesson.

When you're pushing drugs on the street,

you don't exactly get paid

with direct deposit.

Cash money is preferred

when you're dealing in ill*gal activity

because there's no record.

[narrator] But being flush with cash

can create some problems.

They were making so much money

in the street, it was crazy.

[Lewis] Guys like Frank Lucas,

they had hundreds of thousands of dollars

of twenties and fifties

and tens and fives.

It's bulky to carry.

It's difficult to count.

And you know,

the bank will be a little suspicious

about why do you have all this cash money

when most people get paid in checks?

[narrator] Those aren't the only issues.

Ultimately, everybody, including mobsters,

have to give

some accounting of their money,

and if you're living in a mansion

in Howard Beach, and you've got a Porsche,

and then when it comes time

for your income taxes

you claim that you make

$12,000 a year as a mailman,

it's not gonna add up.

[narrator] This is why

the crime gods invented

money laundering.

Ready to turn dirty money into clean cash?

While techniques vary,

they mostly follow the same basic steps.

Step one. Placement.

Create a legitimate business

with a bank account

where you can park your illicit profits,

like a car wash or a strip club.

Step two. Layering.

Use complex transactions to separate

the money from its ill*gal source.

For example, buy gold.

Cash it in.

Then send that money

from one international bank account

to another

to make it even harder to trace.

Or sink the proceeds into assets

like luxury cars, jewelry, or real estate.

Then sell them again.

Bringing us to step three. Integration.

Invest your freshly-laundered dough

into the legitimate financial system

to keep the taxman off your trail.

Voilà! Your dirty drug money

is now clean as a whistle.

Sounds easy,

but the tricky thing

about money laundering,

you can't do it alone.

[Ezell] In New York, Frank knew everybody,

so he had a nice connection

cleaning the money up for him.

[Lewis] He had a connection

at Chemical Bank at the executive level.

He would direct the tellers

to take care of Frank when he came in.

[narrator] And take care of him they did.

[Lewis] They would count

hundreds of thousands of dollars

in fives, tens, ones, and twenties.

And the bank person he was working with

would ask no questions

and just change that money

into $100 bills.

[narrator] Like a true boss,

Lucas invested his clean cash

in legitimate tax-generating businesses.

He practically controlled

an entire block in Harlem.

He had a club there.

He had a couple of stores.

He had office buildings

in places like Detroit

and other parts of New York City.

A ranch in North Carolina.

[mooing]

He bought 4,000 acres of land.

Three hundred heads of cattle.

He had, like,

a $100,000 prize bull down there.

It was a big-a*s bull.

[mooing]

This sucker was huge.

[narrator] Frank's diversified portfolio

paved his way into high society.

Frank knew the celebrities of the day.

Boxers, Joe Louis. Entertainers.

He was a celebrity of his day

even though he was, you know,

doing something very ill*gal and wrong.

[Ezell] One time I'm sitting in the bar,

he's like, "Boy, you like James Brown?"

I'm like, "Yeah."

And then the music started playing,

and James Brown came over,

grabbed my hand and tried to get me

to dance, and I'm like, "Whoa!" [laughs]

[narrator] Thanks to Frank's

money laundering expertise,

he and his brothers were able

to live it up as Harlem royalty.

Everything's money.

This is America. [chuckles]

Everything's money.

[narrator] But when your core product

is high-grade heroin,

the happy days

probably won't last forever.

[siren wailing]

A lot of people started dying,

and the government started waking up.

America's Public Enemy Number One

in the United States is drug abuse.

[narrator] At times like these,

how do you keep

your business plan on course?

The company has suffered serious damage

both to productivity and human relations.

Both must be repaired

as quickly and completely as possible.

[narrator] If you want to build

your business to last,

you need a strategy

that can adapt to all market conditions.

In 1971, President Nixon

coined the term "w*r on Drugs,"

and in New York City, this w*r was raging,

and so it was critical

for New York City Police Department

to show that they could get things done

by taking on these guys.

[narrator] Frank used

a multipronged approach

to address this problem.

Starting with a PR campaign.

He thought doing things for the community

would be an effective way

of protecting himself and his enterprise.

Loaning money to people.

Not worrying about

if you got it paid back.

Taking care of people.

So he kept a community on his side.

[narrator] He also made sure to take care

of an even more important demographic.

Cops.

Frank spent a lot of money

paying off police.

Having the police on the take means

being able to walk down the street

and not worry about being locked up.

It means knowing that you're gonna have

a supply of drugs coming in safely

without being interdicted by the police.

[narrator] But as many

mob bosses discover,

acts of generosity

can leave some men in blue wanting more.

By the early '70s,

Frank Lucas has moved his family

to a quiet house in the suburbs.

But when you inhabit the criminal life,

business has a way of following you home.

[horn honks]

Today, Frank is met

by an unwanted visitor,

a corrupt NYPD detective

he comes to call Babyface.

He orders Frank to pay him

10,000 cash a month.

Or he'll shut down

Frank's operation for good.

Frank doesn't see any real options.

So he pays up.

But while Frank scrambles

to keep Babyface off his back,

an even greater threat is amassing

against him from the DEA.

Agents have been working around the clock

to gather intel on Frank's operation.

And when a mob informant steps forward

[siren wailing]

they hit hard.

[Lewis] I can tell you

when the agents and the police officers

came to arrest him,

his wife threw several gym bags

out of the window.

And there was over $500,000

in cash, small bills.

And this was money that he was collecting

to go to Thailand

to buy 100 kilos of heroin.

[narrator] Sadly,

he'd never make that trip.

Frank goes to trial on both federal

and state drug trafficking charges.

He's found guilty

and sentenced to 70 years in prison.

But then Harlem's top drug boss

makes one last transaction.

[Lewis] Frank joined America's team

and made a business decision

to cooperate to reduce that jail time.

As a businessperson

looking out for himself,

he made the right decision for himself.

[narrator] Even if it meant

turning on his own brother.

You never tell.

And he flipped!

That type of betrayal is

it's hard to deal with sometimes.

It is. You know, somebody else,

you can deal with a little better,

but your brother, your own family members?

Cuts you to the core.

Still hurts to today. Still hurts.

[narrator] What can I say?

It's just business.

Frank Lucas's profit-maximizing genius

earned him millions,

but his time on top

lasted just seven years.

If you want your flame

to burn both bright and long,

you need to dig deeper into the playbook

and follow our next criminal titan,

Sicilian boss of bosses,

Salvatore "The Beast" Riina.

The secret to his legendary run

of underworld domination,

total disregard for human life.

Are you ready

to unleash the beast inside of you?

[theme music playing]