He was considered a genius; a compassionate man who gave freely to the poor. But Caspar Holstein made his fortune from it in the Harlem numbers politics game, which he helped invent.
Casper Holstein was born on December 7, 1876 in St. Croix, Danish West Indies. His parents were of mixed African and Danish descent, and his father’s father was a Danish officer in the Danish West Indies colonial militia. The Holstein family moved to New York City in 1894. An extremely bright boy, Holstein graduated from high school in Brooklyn, no small achievement for a black man before the turn of the century. After graduation, he enlisted in the Navy and, during World War I, visited his homeland, then known as the Western Virgin Islands.
When Holstein was discharged from the Navy, he worked various odd jobs, including being a doorman in an Upper East Side building. He also became a personal assistant to a wealthy white couple, and years later, after he made his fortune and they lost theirs, Holstein supported this couple and later paid for his funeral.
Seeking to better himself, Holstein wandered around Wall Street, where he landed a job, first as a courier, then head courier, for a Wall Street commodity brokerage firm. Holstein fell in love with gambling, especially horses, but also dabbled in the stock market, examining the daily figures from the Boston and New York City Clearinghouses. One day Holstein came up with an idea that would drastically improve his situation. He knew that people in black neighborhoods like Harlem loved to gamble, but most of them didn’t have enough extra money to do so. When he had saved enough money to start his company, Holstein devised a scheme in which people could bet as little as ten cents on a random set of three-digit numbers, which would appear daily in New York City newspapers.
Using figures from the Boston and New York City Clearinghouse, Holstein took the middle two digits of the New York number and one middle digit of the Boston number. So if the totals for the two clearinghouses were 9,456,131 and 7,456,253 respectively, the winning number would be 566; “56” being the two digits before the last comma of the first digit, and “6” being the last digit before the last comma of the second digit. This system was so random that it could not be tampered with, as it would later be, when gangster Dutch Schultz got into the Harlem numbers business and began using racing figures, which he actually rigged. In the early 1920s, the Holstein system was all the rage in Harlem. Holstein became known as the “King Ball”, earning approximately $5000 per day.
Using his newfound wealth, Holstein contributed generously to worthwhile causes. He gave huge amounts of cash to St. Vincent Sanitarium, the nationalist Garvey movement, and funded Opportunity magazine’s literary awards, which uncovered much of Harlem’s young talent. Holstein built dormitories at black colleges and financed many of Harlem’s artists, writers, and poets. He also helped start a Baptist school in Liberia and established a hurricane relief fund for his native Virgin Islands. The New York Times said Holstein was “Harlem’s favorite hero, because of his wealth, his sporting inclinations, and his philanthropy among people of his race.”
Seeing how Holstein and Stephanie St. Clair had turned Harlem into a financial bonanza due to their numbers deals, gangster Dutch Schultz broke in and took over their games. So. Schultz had great politicians, including the disgraced Jimmy Himes in his back pocket. Schultz also bought out the police and killed black-record brokers en masse. Schultz eventually forced St. Clair to work for him, but Holstein turned down Schultz’s offers to consolidate his numbers business.
In 1928, Holstein was kidnapped for a $50,000 ransom by five white gangsters, assumed by the Harlem public to be thugs sent by Schultz. News of Holstein’s kidnapping made national headlines. The New York Times reported that Holstein had been seen at Belmont Race Track just days before his abduction, betting more than $30,000 on the ponies. Holstein was released after three days in custody, insisting that he did not pay a ransom. His explanation was that his captors felt sorry for him and released him with a $3 cab fare.
Holstein’s story carried little weight, however, as he soon scaled back his political activities. A few years later, Holstein stopped trading him on the street altogether and operated only as a better layoff. In 1935, even though he was barely in the game, Holstein was arrested for illegal gambling. He was tried and convicted, and spent a year in prison. Holstein claimed that he was framed, possibly by Schultz, but he spent his jail time without incident. When he was released from prison, Holstein got into the real estate business and provided mortgages for people in Harlem who were shunned by regular banks.
Casper Holstein died on April 5, 1944, at the age of 68. More than 2,000 people attended his funeral at Harlem’s Memorial Baptist Church. A scholarship at the University of the Virgin Islands and a housing development on St. Croix are named in Holstein’s memory.
