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" RWird . Mr. Hoover - 11/6/35 I further advised Judge Clark that this Bureau is keeping closely in touch with the activities of racketeers in New York City and Newark, New Jersey in order that the Bureau might be in a 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 their principal sources of income are alleged to be from gambling houses, slot machines, night clubs and the so-called policy and loan rackets; that none of their activities along these lines con- stitute federal violations which would come within this Bureau's jurisdiction and all are purely local in character. I explained 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 tax laws and give the Intelligence Unit of the Internal Revenue Bureau investigative jurisdiction. 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 Zwillman was being conducted with a view to prosecution for income tex evasion, The Judge then called the local representative of the Intelligence UNITE, @ Yr. Parker, to hie office and inquired con- cerning the status of the investigation of Zwillmen's income. Myr, Parker advised the investigation was still being conducted and that it was being supervised by Mr. Baldwin, of the Intelligence Unit, who is presently out of town, Judge Clark then told Mr, Parker that it appeared to him that the investigation had been in progress long enough to have accomplished something; that apparently the Intelli- 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 Zwillman is not forthcoming at an early date he, Judge Clark, is going to find out the reason why. 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 as soon as he, Baldwin, returns to Newarke