Hot Springs, Arkansas, was a lawless resort town in the 1920s and 30s and a favorite hangout of gangsters like Al Capone and Lucky Luciano. No fewer than ten big-time illegal casinos and many smaller gambling parlors lined the streets, along with bath houses and night clubs. Several hotels offered prostitutes, one of them operated by Grace Goldstein, a plump, peroxide blond, who was a dear friend to the police chief and chief detective.
Born Jewell Laverne Grayson, she left her Paris, Texas, home for New Orleans while still a teenager. The Crescent City is where she perfected her trade as a prostitute and changed her name. After saving up, she opened her own small brothel. Her success didn’t sit well with the other madams so they paid the cops to harass her until she left town.
In 1928 she moved to Hot Springs, rented out two floors of the Hatterie Hotel and hired girls with show-stopping faces and figures. A few years later, she opened a second bordello in a two-story house.
Hot Springs is where she met Public Enemy No. 1, Alvin Karpis, the only member left of the Barker gang. It was June 1935 when he first blew into town and stayed at Grace’s place. At the time, he was on the run from the Feds for two kidnappings.
He always had a roll of cash and spent it lavishly, and Grace set her cap for him. Karpis called her a “big leaguer,” who ran the finest whorehouse in Hot Springs. He was impressed with her list of connections, too, which included the town mayor, local police, politicians and notable crooks.
In November 1935, Karpis pulled a Wild West style train robbery in Garrettsville, Ohio, that didn’t net him a whole lot of money but did bring the postal authorities down on his neck. He made his escape from Ohio in a newly purchased private plane and landed back in Hot Springs.
Fresh off the train robbery Karpis took Grace with him to see her brother, Leonard, in Texas where he unloaded a stash of guns used in the robbery.
When they got back to Hot Springs, Grace rented them a secluded mountainside cottage near Lake Hamilton outside Hot Springs where the pair spent time fishing and target shooting. But Karpis felt like he had to stay on the move, so Grace rented them a house on a hillside that overlooked Lake Catherine.
Postal authorities were getting hot, so Karpis took off for New Orleans. Before he left, he made a date with Grace to rendezvous in two weeks on a lonesome stretch of road between Hot Springs and Malvern. When the time came, Grace was there, but visibly upset. A half dozen FBI and postal agents had raided her place early one morning. They grilled her and threatened her with beatings and jail time. Grace held fast, divulging nothing. Later in the day, she went up to the Lake Catherine house. The Feds followed her. They figured Karpis was in residence, so after she left the house, they sprayed it with lead, exploding the windows and doors and nearly burning it down.
Grace and Karpis decided that this was good time to take a vacation. They took off for Florida in Karpis’ new Terraplane coup then crossed over to Mississippi, visiting sites and acting like tourists the whole way. When the trip was over, the outlaw delivered her back to Hot Springs and left for New Orleans, where he was finally captured May 1, 1936.
Grace was fodder for the newspapers as soon as Karpis was in custody. In just about every article, she related how the FBI had spirited her away for a 12-day period, moving her from place to place while they tracked down Karpis.
When authorities first questioned her, she acted innocent about Karpis and claimed she didn’t know who he really was. She told them that he introduced himself as Ed Wood, a sportsman and gentleman of leisure. He took her to nightclubs and on trips. He liked to fly, so he chartered a plane and took her to the Max Baer-Joe Louis fight in New York in September 1935. It was there, she claimed, they married. She said the ceremony took place in a hotel but couldn’t remember the name, and she gave a couple of different dates.
Grace professed to not know who he was until she saw a newspaper photo of him.
She told reporters she was not sorry to be married to Public Enemy No. 1. “It was already done and there was nothing to do about it,” she said. “ I know I shouldn’t have fallen in love with him, but he was so kind hearted. All those boys are like that.”
It was a happy marriage, she said. The two lived in luxury. They enjoyed shopping, although he would stay on the curb while she made her purchases. Karpis spent $9000 on her. At Christmas he gave her more than $1000 to buy herself a present. She spent it on having a good time. She said he had a fondness for hats.
To be continued…