Mercer and the Capone Family

Jun 9, 2021

Billy's Bar during the time that Ralph Capone managed it.
Credit Wisconsin Historical Society

One of the more colorful aspects of Northwoods history is that 1930s-era gangsters such as Al Capone, Baby Face Nelson, and John Dillinger spent time in the region.  But they were just visitors.  One famous gangster from that era found the Northwoods so appealing that he made it his permanent home. 

Al Capone was the crime boss of Chicago during the Prohibition era and remains one of the most recognizable names in Chicago gangland history.  Nevertheless, while Al was the most notorious of the Capone family, it was his older brother Ralph who made the longest-lasting impression on the Northwoods.

Ralph Capone was born in 1894 in the Italian province of Campania.  His family immigrated to the United States while he was still an infant and arrived at Ellis Island in 1895.  The Capone family settled in Brooklyn, which is where Ralph and his eight siblings grew up.

By 1920, Al Capone had already moved to Chicago to become part of the organized crime mob known as the Chicago Outfit.  He invited Ralph to join him.  Ralph Capone moved to Chicago and was placed in charge of the Chicago Outfit’s bottling plants during Prohibition.  This is where he earned the nickname of “Bottles” Capone.  The Outfit’s bottling operation specialized in ginger ale and soda water, which were two beverages commonly used in alcoholic mixed drinks.  He also ran bootleg beer through the bottling plants.  A lot of money was funneled through Capone’s bottling operation, and by 1930 attorney Frank J. Loesch's Chicago Crime Commission listed Ralph Capone as Public Enemy No. 3.

Ralph remained with the Chicago Outfit after Al Capone was convicted of tax evasion in 1931.  He continued running the operation, but his time in that capacity was limited as he too was convicted of tax evasion in late 1931.  Capone spent the next three years in prison.

Both Al and Ralph Capone had enjoyed the Northwoods and during their Chicago heyday regularly spent summers in the region.  When Ralph was released, he spent time both in Chicago and Florida.  Al Capone was paroled in late 1939, and in September 1940 the Capone brothers made a vacation trip to Mercer.  The brothers were generous tippers and won over the local population with their largess.

In poor health, Al Capone spent the remainder of his days in Florida, but Ralph found life in Mercer to be appealing.  He continued spending summers at Mercer resorts, but in 1942 built his own sumptuous home called Raycap Lodge on Big Martha Lake.  He became the manager of a hotel and tavern in Mercer called the Rex Hotel and Billy’s Bar.

Tax difficulties hounded Ralph Capone his entire life, and in a 1951 interview he flatly denied that he owned any part of the Rex Hotel or Billy’s Bar.  Of course, Capone was a highly skilled accountant and after his time in Chicago was careful never to own anything on paper lest the government come in and take it away.  Local Mercer residents, who benefited from his generosity, consistently backed his story too.

Nevertheless, the IRS never stopped hounding Capone, and tax troubles followed him through the 1950s and 1960s.  By the 1970s his fortune and health were both failing.  He ended his days living in a small apartment over a garage on the outskirts of Mercer.  He died in Hurley in 1974.