Hot Springs madam goes to jail

Here is the conclusion to the story of Grace Goldstein, Alvin Karpis’s girlfriend.

Two years after Alvin Karpis was safely behind bars, the FBI began to build a case against his girlfriend, Grace Goldstein. They nabbed her in May 1938 at a Los Angeles hotel as she prepared to set sail for Honolulu. The charge was conspiracy for harboring Karpis. Seven others were also charged in the same crime, including three Hot Springs cops.

Indicted under her real name, Jewell Laverne Grayson, alias Mrs. Grace Goldstein, alias Mrs. Helen Wood and Mrs. Parker (the latter two names used when traveling with Karpis), she gave her home as Paris, Texas.

During the 12-day trial in October 1938, prosecutors tried to prove to the jury of 10 men and 2 women that Grace and the others had hidden Karpis from authorities in Hot Springs from June 1935 to May 1936. The government established that she operated “disorderly houses,” and it claimed that Karpis had used those houses as his headquarters. Prosecutors also tried to prove that the police were on her dole and, therefore, look the other way when Karpis was in town.

The newspapers reported that when she appeared in court, she was “smartly gowned in blue, her characteristic smile gone, but otherwise she was self-possessed.” Her previously bleached hair was now auburn.

The owner of the apartment building next door to one of Grace’s whorehouses testified that Chief Detective Herbert “Dutch” Akers came by the house every Monday around dusk. The witness, a widow, related how Grace hurried out to his car each time. After talking with him, she would run back into the house and grab her purse. Grace then rushed out to her own car, climbed behind the wheel and followed Akers. Later, she returned home by herself.

            The widow’s testimony was backed up by two of Grace’s girls, blond Jewel Greta Gilstrap and brunette Delia Mate Jeffries. Jewel and Delia also testified to overhearing telephone conversations between Grace and someone whom they believed was Police Chief Joseph Wakelin. After these phone calls, Grace dashed from the house to her car. When she returned home she told the girls she had been out with “the old man,” referring to Chief Wakelin.

The neighbor told the jury that her living room was just across the driveway from Grace’s bedroom, close enough to overhear conversations, and that she once heard Grace tell some of the girls that she paid off police.

Five days into the trial U. S. District Attorney Fred A. Isgrig asked for a conference with the judge and defense in chambers. Out of the jury’s earshot, he accused Grace of trying to intimidate government witnesses and he wanted her $15,000 bond revoked.  Isgrig based this on his claim that he did not get the testimony he expected from one of his own prosecution witnesses. He then asked the court’s permission to cross examine his witness. In the end the judge did revoke Grace’s bond, forcing her to move from a plush hotel room to a cold cell in the Pulaski County Jail.

 At one point during the trial, the judge directed verdicts of acquittal for three of the eight defendants, citing the government’s failure to establish that they had knowledge of a warrant for Karpis. Another co-conspirator pleaded guilty and was sentenced.

            Prosecutors brought close to 100 witnesses into the courtroom, mostly FBI. But the most memorable were the girls and certainly Grace herself.

On the stand Grace spoke in a clear, but soft voice. Her testimony took up most of one day. Under guidance from her attorneys, she admitted to running houses of prostitution since 1923. She apparently dropped the story about going to New York and getting married because on the stand she described herself as Karpis’s common-law wife. She told the jurors that he came to one of her houses of prostitution the first time in June 1935 and gave his name as Ed King. He agreed to pay her $200 a week “for her time.” She said she had spent approximately $20,000 of Karpis’s money.

Prosecutors zeroed in on questioning her about the former police officers as co-conspirators. Throughout her testimony, she maintained that there was no conspiracy to hide Karpis. Prosecutors hammered at her to try to get her to admit she paid Wakelin, Akers and Lt. Cecil Brock to keep Karpis under wraps.

“There was no agreement of any sort” she claimed and was adamant that she only knew Akers and Wakelin casually during 1935-36.

Lying further, she said once she found out who Karpis was, she “lived in grave fear,” and that fear was her reasoning for not turning him in to authorities.

“What did you pay police for running a house of prostitution?’

“Nothing. I simply paid a hotel license to the city and state.”

The prosecutor reminded her that she had told the FBI that Hot Springs police would tip her off if there was any outside interest in Karpis’s presence.

“No, I don’t remember anything like that.”

“Who did you split the $20,000 with?”

“I don’t know that I got $20,000,” she claimed this time and said she split it with no one. “I spent the money as fast as I got it.”

The trial came to a close when the defense rested with Grace as its only witness.

The jury deliberated less than two hours before delivering a guilty verdict. The judge immediately sentenced Grace and the former Hot Springs police officers to the maximum under the law of two years in a federal penitentiary.

That December Grace was back in court to face charges of violating the Mann Act. She was accused of transporting her niece from Blossom, Texas, to Hot Springs in 1935 for immoral purposes. The jury deliberated for 35 minutes on that case and found her guilty. Five years was tacked onto her first sentence.

Grace married Clarence Hollingworth in 1944. She died two years later of lung and heart disease in El Paso, Texas. She was 40 years old.