Brokers, Bagmen, & Moles TRANSCRIPTS

[00:00:00] Anjay: Previously on Brokers, Bagmen, and Moles.

[00:00:05] T-Bun: These fucking guys, Randy Jackson was like a, he was like a fucking hayseed-looking guy. You know, Pete Vogel and the Japanese yen. Wanna give me $10,000, have people lose a $100,000 to him? They'll give him back $90,000. I go, don't sound right. Two seconds later, Randy Jackson he goes, I'll take him off you. With that, my heart went right to my feet. My dad's right—they're G, they're the FBI.

[00:00:37] The Untouchables: I grew up in a tough neighborhood. And we used to say, you can get further with a kind word than a gun, than you can with just a kind word.

And in that neighborhood it might have been true. And sometimes the reputation follows you.

[00:00:54] Anjay: Al Capone. Well, Robert De Niro playing Al Capone. The world's most famous gangster, grew up in Brooklyn, but he gained his fame and fortune in one of Chicago's toughest neighborhoods, Cicero. Technically it's a suburb. Roughly six square miles, it lies just outside of the city's western border, right up against the canals, the railroads, and the expressway.

You know, all the places the mob might like to have nearby. At the turn of the 20th century, Cicero was a factory town where European immigrants chased the American dream. Capone arrived in Chicago in 1919, and the city has never been the same.

[00:01:42] NBC News: Going back to the roaring ‘20s and early ‘30s, Cicero was a synonym for Al Capone and his domination of the illicit liquor industry and other criminal pursuits.

[00:01:53] Anjay: Capone died in 1947, but Chicago's mafia, known as the Outfit, was just getting started.

[00:02:03] NBC News: I characterized Cicero in 1961 as being a walled city of the syndicate.

[00:02:12] Anjay: It's just beyond the jurisdiction of the Chicago police. Cicero became a haven for mobsters. They raked in big bucks with sophisticated bootlegging and gambling operations, and they did whatever they had to do to protect the empire.

[00:02:35] Eyewitness News: Anthony and Michael Spilotro showed very similar injuries. The bodies had been in the grave for several days, at least a week, and possibly longer.

[00:02:47] Anjay: That's the famous murder from the Martin Scorsese classic mob flick, Casino. In it, Joe Pesci's character—who was based on Anthony Spilotro—was beaten to death by members of the Chicago Outfit and buried in an Indiana cornfield.

We'll talk about the Spilotros later. Back in the ‘40s, ‘50s, and ‘60s, Cicero guys had two options: they could break their backs working in a factory, or if they knew the right people and they were tough enough, they could join the Outfit. More dangerous, sure. But it was a chance to make some real money. As time went on, one of those options went away.

[00:03:31] NBC News: Since the mid-70s and the recession and the rusting out of the industrial belt, one estimate says Cicero has lost 25,000 jobs.

[00:03:42] Anjay: It was around that time in the late-70s and early-80s that a group of street smart kids from Cicero discovered a new career path. Like the Outfit, it was a closed society. They were shrewd, cunning, and cutthroat men who would do anything to get rich.

I'm Anjay Nagpal, and this is Brokers, Bagmen, and Moles.

[00:04:20] News: Traders were shocked today with news that undercover FBI agents posed as workers here for two years.

[00:04:29] T-Bun: Everybody was like afraid. Like, what the fuck are we doing?

[00:04:33] News: They are the daredevil gamblers of the financial world, but some commodities traders in Chicago are starting to get nervous.

[00:04:41] T-Bun: I know for sure this fucking guy's no good man.

[00:04:45] Ray Pace: There's no way this guy's coming up to me and offered me that deal. So I knew they were coming. I knew it was only a matter of time.

[00:04:59] Anjay: What do you think, Kev? How's this gonna go? How's this gonna go?

[00:05:02] Kevin: Yeah, yeah. I mean, he's talking about a pretty rough, traumatic part of his life, right?

[00:05:08] Anjay: I'm in the car with our audio guy, Kevin. We're on our way to interview a former broker named Ray Pace. We're meeting Ray at a boxing gym where he's the part owner and the trainer. Tim and Stretch are meeting us there. I guess Tim boxed with Ray, like Ray, you know, trained him.

Yeah, I wouldn't wanna box Tim or Ray. I don't care if they're 60.

Ray and Tim go way back. Ray was on the floor four or five years before Tim, but unlike Tim, he never got the chance to become a lifer. Because when the FBI investigated the floor, Ray faced prosecution on RICO conspiracy, 8 counts of mail fraud, 33 counts of wire fraud, and 77 violations of the Commodities Exchange Act. His life was never the same. And this boxing gym, it saved him.

It's on the fourth floor of a classic Chicago-style building. Red bricks, a grid of super wide windows. Heck, there's even a stuffed pizza place on the first floor.

Inside the space is exactly what you'd imagine for an old school boxing gym. Wood floors, beat up, black punching bags hanging from the ceiling, and a boxing ring right in the middle of the room. The place smells like sweat, but that could just be me.

Ray comes out to meet us. He's got a full head of salt and pepper hair and a square jaw, but he's not a huge guy and he looks really friendly.

And when Ray started talking, I realized he might be as nervous as I am.

[00:06:54] Ray Pace: Hopefully I don't sound too bad. Hanging around the corner most your life doesn't make you most articulate.

[00:07:01] Kevin: Uh, lemme know when you guys are ready. I can slate. I'm ready. All right, slate.

[00:07:07] Anjay: Do you know what I'd love to hear a little bit about is like your, um, your boxing career, like how did that, uh, get started?

[00:07:12] Ray Pace: A pretty tough neighborhood, you know, that's where it starts.

When I, we were kids, we had boxing in high school every day, five days a week, every day for two different years.

And then I went on to fight in the amateurs, but it started there, you know, hung around the corner since I was 14, 15.

[00:07:26] Anjay: So what neighborhood?

[00:07:29] Ray Pace: Leads to it. Cicero, west side of Chicago.

[00:07:31] Anjay: Yep. That's Cicero, home of Al Capone.

[00:07:35] Ray Pace: It was a pretty rough neighborhood, so it lent itself to different types of trouble, put it that way. You know, there's a lot of gambling and a lot of stuff happened in that neighborhood at the time. So, but real, real working class, great neighborhood to go, but I wouldn't change anything. You know.

[00:07:49] Anjay: He kept alluding to Cicero being a really tough neighborhood and how it was easy to get in trouble.

I'm pretty sure he was talking about the Outfit and it felt like Ray didn't want to be in that lifestyle. So he went to college on a baseball scholarship. But his real talent was in boxing. He even tried to go pro, but it wasn't paying the bills. So he bounced around a bit.

[00:08:14] Ray Pace: After school, uh, I worked, I could have been on, uh, physical education.

That's what I got my degree in. Cuz I was an athlete since I was a kid.

Did that for a short time. Got on, uh, some motion picture and TV commercial and that union and I started doing that for a while.

You know, my wife was working for Jimmy at the time, Jimmy Kaulentis, so Oh yeah. She was holding the deck for him.

[00:08:33] Anjay: Ray's wife worked for a man named Jimmy Kaulentis. He was one of the founders and majority owners of the brokerage firm, ABS Partners.

[00:08:43] Tim: So your wife was working on the floor. That's an incredible job.

[00:08:46] Ray Pace: She went right outta high school.

[00:08:48] Tim: Did she really?

[00:08:48] Ray Pace: Yeah. Yeah.

[00:08:49] Anjay: How did she get down there? I mean, what was her entry into it?

[00:08:52] Ray Pace: Same thing with her. One of her girlfriends was working in the cattle.

[00:08:55] Anjay: The cattle pit where brokers traded contracts on the future price of cattle. Each contract represented 40,000 pounds of cattle.

That’s a lot of beef.

[00:09:12] Ray Pace: Next thing you know, they had six of 'em that went to school to get her head started down there running orders.

[00:09:21] Anjay: Just like Tim Stretch and T-Bun. Ray didn't seek out a career on the floor. He just stumbled upon one through personal connections. His wife and her friends got to the floor around 1980 and over the next few years, they pulled in as many friends as they could. If, like me, you figured our financial markets were run by educated and properly trained individuals—well, you'd be wrong. Because Chicago's exchanges were largely run by a network of friends and family who got there first.

[00:09:57] Ray Pace: There was nothing coming in, so I had nothing to lose and I went down. I didn't know really anything about the business, and that's how I ended up going down there.

[00:10:03] Anjay: Ray's wife worked for a large brokerage firm called ABS Partners. She must have done well because they offered Ray a job too. He accepted and stepped into a whole new world.

[00:10:17] Ray Pace: When you first walk on the floor, I think it's like mass confusion. You're just looking around going. What you know, it's so fast-paced and people are running around, you have no clue what's going on, and you start thinking, I don't know if this is for me. It wasn't really the real world, you know? It really wasn't.

I mean, I came from nothing. My father was a factory worker, so when I went down there to see the kind of money that I went through there, or just what guy spent on a daily basis, just the lunches that they went on. $2000, $3000. You're talking in the ‘80s now.

These guys were spending, you know. It could be lucrative in a real, real short period of time down there, which brought out to go to their bad side sometimes and guys, right? Let's face it. But it was like nothing I was ever involved in.

Believe me it was, it was something.

[00:11:09] Anjay: ABS partners had brokers in just about every pit on the exchange and was one of the most profitable companies on the floor.

So these stories of lavish lunches are no surprise. ABS had a powerful and controversial group of owners. Controversial, either because of flagrant conflicts of interest, or because of the dubious company they kept.

For example, Ray's wife worked for ABS co-founder Jimmy Kaulentis. Kaulentis was very close friends with the Spilotro brothers, the mobsters that we mentioned at the top of the episode who were found murdered in an Indiana cornfield.

[00:11:51] Ray Pace: There was rumors that mob money was being laundered down there. A lot of talk that maybe the brokerage group being one of the largest brokerage groups on the floor, maybe they were a target, you know.

Maybe they were looking to see how they were getting there, how they were soliciting their business. You know, when you looked at it, you just didn't, you didn't see it, you know.

[00:12:09] Anjay: Ray is addressing rumors that ABS paid bribes to solicit business. But Ray never saw anything to substantiate that. So I asked him about some other rumors.

[00:12:36] Ray Pace: There was definitely rumors about that there was Feds on the floor. Nobody knew where, nobody knew what pit it was. Just talk of it, you know?

It was just talking in the pit and somebody mentioned it. Somebody said something about the Feds being on the floor. So I don't think this was a total secret to everybody down there. I think there had to be some knowledge of it for somebody maybe higher up at the exchange.

[00:12:58] Anjay: Ray doesn't remember who he heard the rumors from, but Ray does remember his first interaction with the FBI agent in his pit. A guy who went by the name of Peter Vogel.

[00:13:12] Ray Pace: A real clean-cut guy, real conservative-looking guy. You know, he talked about being well capitalized. I think his name was Peter Vogel, that he went by on the floor. He had a badge, came in just like any other guy that was trading in a pit for himself.

[00:13:25] Anjay: All traders had badges with two or three letter acronyms on them to help them identify who they traded with.

[00:13:32] Ray Pace: And I told him things, you guys are gonna be surprised at this, that were so positive about the way to conduct yourself in a pit. I said, look, you can make enough money down here without trying to uptick downtick the market or jump the stops. Don't start doing that shit. I told him all those things. When he first came in a pit.

[00:13:52] Anjay: Ray was adamant that he advised Vogel to act with integrity and not to commit the type of illegal acts the agents were there to catch. So Ray offered the new guy some advice.

[00:14:05] Ray Pace: Keep your integrity, do the right thing in here, you, you'll make a lot of money. There's a lot of money to be made here without having to do that. You know, cuz there's a lot of guys in the pit that don't conduct themselves the right way and do that stuff.

[00:14:16] Anjay: They were in the Japanese Yen Currency Futures at the time.

It was a pretty small pit. So Vogel was able to get closer to some of the brokers like Ray and a few of his colleagues from ABS.

[00:14:28] Ray Pace: In the pit. You watch a guy. Day-to-day and his actions and how he conducts himself in the pit.

And this guy was, whatever you need, Ray? Whatever you need, Ray? He's in, he was constantly there.

You, you, okay Ray? And then after a while, you, you.

Nobody's that helpful.

He was too helpful.

And, and if you're in the business, you'll know what I mean. Nobody that helpful.

[00:14:52] Anjay: It was the same thing T-Bun described in our last episode. Ray saw Vogel offering to bag trades for a broker. And like T-Bun, Ray, thought it was really strange.

No local traders just walk up to brokers and say, Hey, if you made any mistakes today, I'll help you cover those up.

[00:15:13] Ray Pace: He had only been in a pit a couple months and stood close to me and said he wanted to talk to me about something. We were in the Merc Club, lunchtime when we went down there and.

[00:15:23] Anjay: The Merc Club, the place T-Bun ran up a monthly bar tab that exceeded his mortgage payment.

[00:15:30] Ray Pace: He used an example and he said, if we, you know, do a trade and you lose uh, $10 grand, I'll give you $9,000 cash.

He sat there and I said, something's not right here. I don't know this guy. I know this guy for two months, three months, he's offered me this kind of deal. He just gave $9,000 cash. I looked at him and I said, no, I'm not doing that. I said, I'm not never getting involved in it. I, I had a cup of coffee. I got up and I walked away.

[00:16:00] Anjay: This is the exact same tax evasion deal that the FBI offered T-Bun in our last episode.

[00:16:07] Ray Pace: I knew that all of those rumors that I had heard before this was him. It had to be, there's no way this guy's coming up to me and offering me that deal right then and there.

I knew what was going on.

[00:16:21] Anjay: The chaotic rhythm of the floor made it hard to catch traders cheating. So the FBI blatantly tried to help traders commit crimes, and it wasn't going unnoticed.

[00:16:33] Ray Pace: Nobody's gonna go out on their way as much as this guy did in the pit. But then, but then on top of that, when he took me to the lunch with the tax thing, that was kind of what sealed it in my mind anyway.

[00:16:47] Anjay: So let's slow this down a little bit. What T-Bun and Ray realized was that the agents were trying to catch guys in at least two ways.

One was through a tax evasion scheme that seemed too good to be true.

The other was to voluntarily help brokers with any costly errors they made filling customer orders in the pit.

Ray was in the Japanese Yen Pit and T-Bun was in the Swiss Franc Pit.

And even though they knew each other, they never figured out they had the same kind of run in with the agents. They did, however, both display the same kind of street smarts.

Here's T-Bun.

[00:17:31] T-Bun: So I went back in the pit and a couple guys are order fillers, I say, come here.

So I went down in the club one by one. I said, I don't know for sure, but this fucking guy's no good man.

[00:17:43] Anjay: T-Bun is talking about Randy Jackson, the hayseed-looking guy from the last episode.

[00:17:49] T-Bun: Well, yeah, I've been noticing that. He's always fucking nosing around asking questions. So then all the guys all the order fillers that stood by me, they wouldn't trade with him anymore.

So he like iced him. So he went on the other side of the pit.

[00:18:04] Anjay: T-Bun told his broker friends who stood by Randy Jackson that he might be FBI.

And remember, Randy's whole job was to pretend to be a willing bagman to brokers in his pit to help them cheat. So now thanks to T-Bun, they were suspicious of Randy and wouldn't trade with him.

Over in the yen pit, Ray gave Peter Vogel the same treatment. He iced him.

[00:18:36] Ray Pace: I really didn't talk to him much after that. I stayed away from him.

[00:18:41] Anjay: Ray was a broker and Peter Vogel was a local who had been standing next to him for probably over a year.

So Ray traded directly with Vogel a lot. If Ray did anything illegal at all, he was probably already in deep trouble.

Ray knew something was up with Peter Vogel, but he wasn't as sure as T-Bun was, so he kind of kept it to himself.

Meanwhile, Peter Vogel kept trading with the other brokers around Ray.

[00:19:13] Ray Pace: He was putting himself in the right spot around other order fillers that were up on the top step.

[00:19:19] Anjay: Position is everything on the floor.

So Peter Vogel was smart to get as close to the top step as he could because that's where the biggest brokers stand, and that's where you're the most visible to everyone in the pit.

Those top step brokers also had the biggest orders, which gave them a way to cheat if they were so inclined.

[00:19:41] Tim: Could you dual trade those days?

[00:19:43] Ray Pace: Yeah, I could at that time. Yeah. You could trade your own account while you're filling orders. Yeah.

[00:19:49] Anjay: Dual trading. That's when as a broker, you could speculate on the market with your own money and at the same time execute orders for customers. I've always thought that dual trading was a rife for manipulation, and here's why.

[00:20:07] Ray Pace: Now, let's face it, you don't do anything illegal, but if you're the order-filler and you got the business that's coming through you, you basically see where the public's going.

If you, you know the, the difference between the buys and sell you, you can kinda see where the, the. It's an edge that you have.

[00:20:23] Anjay: What Ray is saying here is really important. He says that when you see customer's orders, it gives you a good idea which way the market is going to go.

If everyone is buying, the market is gonna go up, and as a broker you have the inside view.

[00:20:42] Ray Pace: I never let that get in the way, the orders came first. You didn't want to get into that because that that was your living.

You know what I mean? So whatever I made on the side was just a little extra I that I wasn't as concerned with that as I was would fill in the orders.

That's why this was so ironic that this all happened, to be honest with you, you know.

[00:20:57] Anjay: To be clear, it was legal for brokers to trade for themselves and speculate on the market, but they weren't supposed to let their knowledge of customers’ orders influence their personal trading. That was called front running, and front running was illegal.

Right now, you might be thinking, well, who the hell made up these crazy rules in the first place?

Well, the people who ran the exchange, who also owned the exchange, who also traded on the exchange, those are the people that made up the rules.

As for Ray, he says he rarely dual traded and never traded in front of his customers, but he does admit that when he filled orders, he sometimes cut corners and worked with locals to get out of his errors.

The two FBI agents tried to lure Ray and T-Bun into illegal tax deals in early 1988. By the fall, suspicions began to mount that there were Feds on the floor.

For Randy Jackson and Peter Vogel, time was running out.

As the year wound down, Randy Jackson got in on a huge Super Bowl squares betting pool. On Sunday, January 22nd, the 49ers beat the Bengals 20 to 16 to take Super Bowl 23, and Jackson won about $6,000.

But he never showed up to claim his cash because by then his identity was no longer a secret.

[00:22:57] News: Traders were shocked today with news that undercover FBI agents posed as workers here for two years, uncovering what could be the biggest financial scam since the Wall Street insider trading scandal.

[00:23:11] Anjay: On January 19th, 1989, the Chicago Tribune published a bombshell headline that read, "US Probes Futures Exchanges."

The next day, an article described the surprise, late-night visits the FBI made to trader's homes to get them to admit they were cheating and to testify against their fellow traders.

[00:23:34] T-Bun: They went to the one guy's house. Poor guy. And he thought they came to drink with him. He liked to drink beer, and he talked to him for like three fucking hours.

[00:23:43] Anjay: That guy was a successful broker named John Baker.

The younger guys in the pit called him the Mutant Peacock because of his flamboyant trading jackets and his ability to drink staggering amounts of alcohol.

And Baker was doing just that at the Merc Club after work the day the Feds came over. By the time they knocked on his door, he had just polished off his fancy dinner consisting of a Whopper, fries, and a can of Chicago's finest beer, Old Style.

And as he cracked another beer open, the doorbell rang.

[00:24:24] T-Bun: He was drunk, but he thought they were coming to like party with him and his wife said, you, you drunken bastard.

[00:24:32] Anjay: According to his lawyer, he was not very coherent, so they talked to his wife too.

They told her they'd repossess their house, her jewelry, everything they had, if her husband didn't cooperate.

As for Ray, he was on the floor every day that week with a hole burning in the pit of his stomach.

[00:24:56] Ray Pace: It's spreading like wildfire around the floor. And people had already been approached.

They had come to their house with subpoenas, so I knew they were coming.

I knew it was only a matter of time, just because he had stood next to me long enough.

But still at that point in time, I didn't see it as that big of a deal, you know, I mean, you're talking about a couple ticks on these orders here and there.

In a pit, it's an every, everyday occurrence. Happens every day in a pit all day long.

[00:25:20] Anjay: Ray admitted to skirting the rules, but he says most of it was in service of helping his customers. And he said these trades involved very small dollar amounts.

So at first he really didn't think this was that big of a deal, but by Thursday night it was all over the news. The national news. And all of a sudden it seemed like a pretty big deal.

[00:25:47] News: As many as a hundred brokers and traders are alleged to have systematically cheated customers out of millions of dollars.

The daredevil gamblers of the financial world. But some commodities traders in Chicago are starting to get nervous.

Accused of conspiring to skim profits from customers. Double dealing in the trading pits. And cheating customers out of millions of dollars.

[00:26:10] Anjay: And finally, a few days later, Ray heard a knock at his door.

[00:26:21] Ray Pace: There was two guys that came to my door and knocked on the door and my wife and I were sitting down for dinner and, uh, I didn't even have to look. I go, they're here.

And they just handed me to paper and I took it, shut the door and went back in the house and wouldn't eat a bite of dinner. Threw it in the garbage. Yeah.

[00:26:39] Anjay: Did you really throw it in the garbage?

[00:26:40] Ray Pace: Yeah. Yeah, it's kind of tough situation at the time, you know? So, yeah.

[00:26:48] Anjay: What was it like?

[00:26:48] Ray Pace: Not much of an appetite.

[00:26:52] Anjay: More than a dozen FBI agents knocked on doors that first week. They revealed their true identities. They told the traders they had them on tape making illegal trades, with the hope being, they'd cooperate with the government's investigation. They had subpoenas, but they didn't arrest a single person.

[00:27:13] T-Bun: Everybody was like afraid. Like, what the fuck are we doing? We're doing, we always, we've been taught to do, you know?

And all of a sudden now, this guy's. Oh, they're by my house last night. They're by my house last night.

[00:27:27] Anjay: A few days after they were at Ray's house, they paid T-Bun a visit.

[00:27:33] T-Bun: My dad was just getting outta the hospital. I went to pick him up. My brother was at my house and so I rang the doorbell and my brother went downstairs and there was three guys with suits, you know, wingtip shoes.

And he goes, Anthony home? My brother says, no. Who are you?

We're friends with him. My brother looked, he goes, He doesn't have friends like you. Get the fuck outta here.

It was a Sunday.

Monday went to work and I heard a couple doors slamming.

There they were coming up the steps. I opened the door.

They said, you're going to jail.

Oh, you gotta cooperate this and that. So I said, listen. I didn’t do nothing wrong.

No. You know people, you know everybody down there.

You know what goes on. You talk, we'll spare you jail.

I said how about this?

Go fuck yourself.

And I closed the door.

[00:28:27] Anjay: As T-Bun told me the story, all I could think about was that line from the movie Goodfellas.

[00:28:33] Goodfellas: And you learned the two greatest things in life. Never rat on your friends and always keep your mouth shut.

[00:28:41] Anjay: I really don't think the FBI expected these reactions, but Ray Pace and T-Bun, they lived by a certain code.

[00:28:51] T-Bun: I have nothing to tell 'em that didn't, that wasn't going on at the beginning of time down there.

They made it sound like they were taking some little lady in Iowa's money out of her account, stealing it.

It wasn't the case, you know, it was just a practice like anything else.

[00:29:08] Anjay: Ray and T-Bun, they rationalized what they consider to be minor rule violations by saying that everyone did the same thing.

That moving fast and fixing mistakes later, those were the unwritten rules of the floor.

This rationale is important to remember because it would actually become raised defense in court.

And it set him on a completely different path than his fellow yen traders.

[00:29:37] Ray Pace: It was errors. It was errors. It was stuff that was misfiled. It was stuff that was coming in late from the desk.

You had to make that order good, to make the customer good. Right. And there was a lot of different ways that could happen. And that's what we did. That's what we did as a filling broker.

Did the locals help? Yeah. I mean, that wasn't my idea.

That was intact when I came down to the Florida. I never invented the system, you know what I mean?

[00:29:58] Anjay: Ray never equated minor trading infractions with violating federal laws that could land you in jail.

I'm not defending him. I'm just saying that if you're working in a system like this, maybe the system itself or the people who created it and who were charged with its oversight, maybe they should be held accountable too.

[00:30:23] Ray Pace: You don't think you're breaking any laws in there. That's the honest to goodness truth.

We, we had an orientation of stuff at the Merc, but nobody ever told us anything we were doing in that pit was against the law.

Nope. Ever. This is something that was the way business was done.

I don't think anybody thought they were hurting anybody by that. I don't think anybody thought they were hurting the customer by that.

[00:30:45] Anjay: In a press conference, US attorney Anton Valukas announced that traders were facing RICO charges.

RICO is shorthand for the Racketeer Influenced and Corrupt Organizations Act.

It was created to take down big corrupt organizations like the mob, and until this case, it was never used against a legal business.

[00:31:12] News: The government says this is the most wide-ranging use to date of the Racketeering Influenced and Corrupt Organizations, or RICO law, against white-collar crime.

The pits have been labeled as criminal enterprises, but only individuals are implicated, not the exchanges themselves.

[00:31:29] Anjay: That is crazy. How do you label a pit a corrupt organization, but not the exchange that the pit is in?

On the next episode of Brokers, Bagmen, and Moles, we're turning our attention to the system itself and the man at the top of the Merc. His name is Leo Malamed. He was no Al Capone, but like Capone, he's an outsider who came into Chicago and built an empire that changed not only the city, but the whole world.

[00:32:09] David Greising: We think these exchanges are corrupt from the bottom to the top. We want to go after Leo Mohamed and people like that. We think the whole enterprise is corrupt. That's the sort of thing. The head of the FBI is going to approve.

[00:32:25] Anjay: Before you go. If you or someone you know might have a hot tip or just a funny story related to our show, we have a hotline for you. Call us at (646) 820-1452.

That's 646 820 1452. And please follow us on social media. Our handle is @entropymediaco. That's at Entropy Media Co where we'll be posting additional information about the case and awesome behind the scenes action.

This has been a production of Entropy Media in association with Stretch Productions.

This is Entropy's very first show, so if you've enjoyed it, please follow wherever you listen to podcasts and rate us there too. Every follow rating or even a personal recommendation to a friend or family member really helps.

I'm your host, Anjay Nagpal. Our showrunner and senior producer is Danielle Elliot.

Our producer is Jenn Swan.

Our executive producers are Tim Hendricks, Kevin "Stretch" Huff, and Dennis Stratton. Original music, sound design, and editing by Gerard Bauer.

Music clearances by Deborah Mannis-Gardner from DMG Clearances.

Production legal by Bruns, Brennan, and Berry.

Legal clearance/Fair use by Rachel Strom at Davis Wright Tremaine.

Fact checking by Delilah Friedler.

Show art by Rebecca Hendin.

And from Entropy Media, our in-house executive producer is Josh Fjelstad. Our head of operations is Nuna Eboe. Our project manager is Sebastian Perry. Our associate producer is Heidi Roodvoets. Our development coordinator is Simona Kessler.

And I wanna send a very special thanks to Laurie Morse and David Griesing.