February 1931. At Churchill Downs, the entries for the Kentucky Derby are closed. Tight-fisted Dutch Schultz, beer baron of the Bronx, places a bet with the Syndicate: 100-grand in the Winter-book on Enchantment to win the Kentucky Derby. Trying to get the most for his money, Dutch knows he will get much better odds now than if he waits until race day. Dutch's lieutenant is "Lefty" Gallagher, and his bodyguard is Benny Bristow. Schultz has a powerful enemy in Vincent "Mad Dog" Coll, who earned his nickname (which Schultz stuck him with) due to his violent actions; his sidekicks are "Needles" Bledsoe and "Fats" Finney.
Lefty Gallagher cautions his boss Dutch: if anything should happen to the horse between now and the Kentucky Derby in April, the Syndicate doesn't give refunds. But money-loving Dutch is savoring the 7-to-1 odds he's gotten; at post-time, he might only get 8-to-5. When Lefty leaves, Coll and Needles put the snatch on him; Coll knows what a notorious cheapskate Dutch Schultz is, so he holds Lefty for $100,000 ransom-- so it'll get Schultz right where it hurts most, in his wallet. Ness and his men are in New York; Ness hears about the kidnapping from a juvenile eyewitness.
Coll makes Lefty write 3 ransom notes, which Coll will turn in to Dutch one at a time. When Coll dictates he wants $100,000 Lefty fears for his life; he pleads with Coll that Dutch is so tight with a buck he'd never pay that amount, Lefty wants it lowered to 25-grand. Fats Finney reads to them from the paper; Schultz is betting 100-grand on a horse, it says so in Walter Winchell's column. Lefty, figuring he's almost as good as dead, writes in the last note that he swears to Schultz he'll repay the money. Coll attaches a silencer to his gun, then pumps 6 slugs into Lefty; Coll tells Needles to get the notes, saying, "Them we need, him we don't." Coll tells Finney to stuff the body in the closet.
In the following days, Lefty Gallagher's kidnapping is big news in the papers. Dutch Schultz correctly figures Lefty is dead already. But his bodyguard Benny tells him the boys are upset: if Dutch won't go to bat for Lefty, they figure he won't go to bat for them. Dutch reluctantly agrees to pay the $100,000. But miser Dutch is incensed with the ransom demand to toss the money into a garbage can in Foster Park in Long Island; "Money in a garbage can!" Dutch rants, and he calls Coll "nuts." Meanwhile, Coll and his boys start their watch in a house, just a couple of hundred feet from the garbage can drop-off.
Ness has 2 interests in the case: he wants to get Coll for kidnapping, and if he catches Dutch Schultz (who says he doesn't have much money) with 100-grand, Ness might nail him on an income tax evasion charge. But there's a snag in Coll's scheme: a cleaning lady finds Lefty's body in the closet, where it's been for 4 days; she faints. Ness and his men are alerted. At the scene of the crime, Ness finds the newspaper with the item in Walter Winchell's column circled: Schultz's $100,000 bet. When Schultz finds out Lefty is dead, Schultz says he pinned the right tag on Coll: "Mad Dog." Ness drops in on Schultz; he tells Ness about the noon time drop-off demand. Penny-pinching Schultz is happy: not only did he save $100,000 but Ness will save him the cost of having Coll rubbed out, too. But Coll finds out the newspaper carried the story of Lefty's death; Coll and his 2 boys split before Ness and his men show up.
For the next couple of months, Ness looks everywhere for Coll. Dutch Schultz seems to forget about Coll, as Dutch celebrates his birthday.* On April 20, as Diana Carten, owner of Enchantment, has her horse transferred from Lexington, Kentucky, to Churchill Downs, Coll kidnaps the horse. Ness warns her not to pay the $50,000 ransom. But she does, and Coll runs off with her money. However, Coll decides to return the horse after all...Coll has a scheme: he bets the $50,000 at 6-to-1 odds on Dream Prince (he'll only get those kind of odds if Enchantment is running against him). Coll plans to shoot Enchantment...during the running of the Kentucky Derby.
Just before the Kentucky Derby race starts, Ness notices a cameraman above the crowd...armed with a high-powered rifle. Youngfellow shoots Needles; Fats Finney is apprehended. Ness does a flying-tackle on Coll just before he fires his rifle. Ironically, Dream Prince comes in # 1, and Enchantment # 2 -- Coll would have won his bet, and Schultz lost his $100,000 without Coll trying to shoot the horse, and getting arrested by Ness. It seems Coll was not charged with murder (no bail on that), but only extortion; Coll skipped bail and fled to New York. The Underworld (specifically Schultz) put a price on his head: 50-grand. On February 7, 1932 (actually February 8), Coll died in a hail of machine-gun bullets, in a telephone booth on W. 23rd Street.