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Ril srd Mr. Hoover - 11/6/35 I further advised Judge Clark that this Bureau is =a. keeping closely in touch with the activities of racketeers in New as York City and Newark, New Jersey in order that the Bureau might be ina position to take prompt and immediate action in the event any of these parties violate any laws within the Bureau's jurisdiction; that apparently they have carefully avoided such violations; that donate amt adwed = a ™, = wo their principal sources of income are alleged to be from gambling houses, slot machines, night clubs and the so-called policy and loan racketa; that none of their activities along these lines con- stitute federal violations which would come within this Bureau's ol jurisdiction and all are purely local in charactere I explained ae to the Judge, however, thet in the event the racketeers' income ‘ from these sources is not properly reported and the required tax paid it would, of course, constitute a violetion of the income ax laws and give the Intelligence Unit of the Internal Revenue tax * a! thi J " q e nvestizative juri sdiction, + amuat Ya Vals The Judge stated that about last March a represen- tative of the Intelligence Unit of the Internal Revenue Bureau - conferred with him and at that time stated that investigation of . Zvillman was being conducted with a view to prosecution for income coe tax evasion, rye_Tudge then called the toca. representa. of the fea: Intelligence Unit, 6 Yr. Parker, to his office and inquired con- mingling cerning the status of the investigation of Zwillmean's income. Mr. 2 Parker advised the investigation was atill being conducted and that it was being supervised by Mr. Baldwin, of the Intelligence Unit, E-x. who is presently out of town, Judge Clark then told Mr, Parker that _ ad it appeared to him that the investigation had been in progress long ae enough to have accomplished something; that apparently the Intelli- we! gence Unit did not have enough agents on the job or else the ones : who are conducting the investigation are not qualified to do the work. He informed Mr. Parker that he expects and is going to insist on some prompt action; that he is tired of Zwillman and others of | his type whose income runs into the millions openly flaunting the law around Newark and that if such action as might be necessary to | institute prosecution against Zwilliman is not forthcoming at an early date he, Judge Clark, is going to find out the reason whys During this conversation with Mr. Parker Judge Clark was very emphatic in his statements and he instructed Mr. Parker to have Baldwin call upon him just ae soon as he, Baldwin, returns to Newarke