New York, 1931. While many people were unemployed and poor during the Depression, gangster-owned speakeasies and nightclubs created a new mobster aristocracy. One top mobster is Jack "Legs" Diamond -- known to the Underworld as "the Clay Pigeon" because of the many times he'd been shot at, and survived. Although he's married, Jack Diamond carries on openly with lovely canary Dawn Dolan, who sings at the Hotsey Totsey Club, a nightclub Jack owns; his philandering is in the newspapers all the time. The mob hates all the publicity he is drawing to himself-- and therefore might draw to them. When Jack gets his picture taken for the newspapers once too often, there's another rubout attempt on Jack; again, he survives, but the 19-year-old parking valet standing next to him gets hit by the shotgun blasts.
Jack Diamond meets with the Top 4 bosses-- Oscar "Benny" Benjamin (financier), "Big" Bill Swinney (narcotics), Dutch Schultz (beer baron of the Bronx) and Charles "Lucky" Luciano (prostitution, dope, gambling). They're not surprised he escaped another killing attempt, Oscar Benjamin says "He's got a pair of pins that always take him out of trouble."
Jack's publicity calls attention to all of them, and they are working on a $5-million dope smuggling project. They give Jack the word: he's to cool off in his Catskills home for a while. Jack had set up the European part of the operation, to bring in the morphine and heroin from Greece. Meanwhile, Ness and his men are on the case; they're taking a train to New York to meet with John Carvell, U.S. Attorney for the southern district of New York. For days, Ness and his men stake out the East River docks.
Working them is an undercover customs officer, Dimitrius Spiros. Ness takes a big risk: he tells Dimitrius that when he finds the dope, he is just to mark it, Ness wants to trace it from the docks to wherever it's going. Dimitrius can't believe Ness is risking letting $5-million worth of dope come ashore, but he goes along with it. One night, Ness gets a call from Dimitrius: he's found the stuff on the ship Corinthus in the # 4 hold, he's marked it with his initial "D" and he has also chalked a "D" on the truck hauling it. Ness and his men get there in 15 minutes, but they're too late. The dope is gone, the letter "D" has been removed from the truck (driven by Moxie Harris), and Dimitrius is dead, with a big knife sticking in his back.
Ness and Enrico Rossi show up at Jack Diamond's place in the Catskills, just as he's slapping his wife Alice around. Ness tells Jack he knows all about how he went to Greece, and Luciano put him in touch with a family of cutthroats called Esotopolis. Ness tells Jack he's been double-crossed by the bosses, the stuff came in 2 days ago. That night, Jack gets a couple of his boys, and finds Moxie Harris; Jack takes the narcotics. Moxie pleads for his life, saying he was only doing what Bill Swinney and Lucky told him to do-- Jack pumps him full of lead.
That same night, Ness goes to the Hotsey Totsey Club to arrest Jack Diamond for the murder of Moxie Harris. But Jack has an alibi: his main squeeze Dawn Dolan lies to Ness that Jack was here all night. Jack might have talked his way out of it with Ness, but not the kingpins; they (Oscar "Benny" Benjamin, Charles "Lucky" Luciano, "Big" Bill Swinney-- but for some reason, not Dutch Schultz) show up at his club along with a couple of triggermen-- one of them points a tommy-gun at Jack's head. Jack coolly says, "One squeeze on that, ya kiss 5-million clams good-bye." Only Jack knows where the stuff is; he wants his $1-million in cash in advance, in 48 hours. They have to agree.
Jack goes home and slaps Alice around some more; he's dumping her for Dawn. Later, Ness visits Alice, who has a big bruise on her face. Ness rubs it in that Jack will get the girl and $1-million. Although Alice won't tell Ness where Jack is, as soon as Ness leaves she calls Oscar and tells him where Jack is staying in Niagara Falls. Ness' men have a wiretap on her phone, and fly up there. Jack is surprised to see Bill Swinney drop in on him; but Swinney gives him the million. Jack tells him the stuff is in a safety deposit box in a bank, and gives him the authorization paper. But Swinney can't kill him yet, in case he's lying.
But a little later, as Jack and Dawn are leaving, Swinney and his 2 hoods attack. Swinney grabs Jack and yells, "How are ya, punk?! I hate your guts so much I'm gonna risk that $5-million!" Ness and his men drive up like gangbusters. There's a big shootout. Swinney shoots Jack Diamond; Ness blasts Swinney with a chopper. The 2 hoods get it, too. Ness gets the authorization paper off of Swinney. Ness had smashed the dope ring. In the following weeks, Oscar Benjamin got a slug in the stomach from parties unknown; Lucky Luciano was deported to Italy; and Dutch Schultz died by the machine-gun.