McPherson is believed to have controlled most of Sydney's organised crime activity for several decades, alongside his contemporary Abe Saffron (who was dubbed "Mr Sin") and associate, bookmaker George Freeman.
Universally feared by adversaries and often referred to as Sydney's "Mr Big" of organised crime, McPherson built up an extensive network of criminal activities that included robbery, theft and extortion rackets, illegal gambling, "sly-grog shops" (illegal alcohol outlets), prostitution and drug dealing, and his influence is also believed to have extended to South East Asia and the United States McPherson's well-earned reputation for extreme brutality is exemplified by an incident recounted in Tony Reeves' 2005 biography.
He demanded to know why he had not been invited to her birthday party, and when she admitted that it was because of his criminal activities, the furious McPherson tore the rabbit's head off, threw the still-twitching body at her feet and stormed off.
[3] During World War II McPherson's father found him a position as a driller at the dockyard where he worked, enabling Lenny to avoid conscription, because dock workers were a protected occupation.
During this period he racked up a string of traffic fines for minor infringements including speeding, illegal parking and driving an unlicensed vehicle.
From the end of the 1950s, McPherson worked assiduously to secure and increase his power and influence and by the late 1960s he had established an extensive network of organised crime operations which were allegedly supported and protected by corrupt police and public officials.
These relationships quickly developed into a mutually beneficial arrangements—corrupt police exploited McPherson as an informant and 'enforcer', while they in turn were used by him to neutralise enemies and to protect his organisation.
From this point on, McPherson's influence over police, prison guards, lawyers, magistrates and politicians allowed him to literally get away with murder on numerous occasions.
McPherson and his longtime bodyguard, "Snowy" Rayner (alias Lewis William Hunt) were charged with the murder, but according to Tony Reeves, before they could face a trial the case was dropped on the orders of the Attorney General of New South Wales, Reg Downing.
Clayton was arrested only hours after the shooting—although police never revealed how he was picked up so quickly—and after a 14-hour interrogation he allegedly made a "verbal" admission identifying McPherson and Rayner as the killers.
Acting on Clayton's admission, detectives Fred Krahe and Les Chowne picked up McPherson and Rayner the next day and questioned them both at length.
It outlines their scheme to avoid prosecution, states that Clayton had already been "seen" by some of Lenny's men and that he would never testify against them, describes the plan to fabricate alibis, details the bribing of two other witnesses by offering them £1500 to leave the country, and gives instructions for Campbell to deposit £400 in the account of solicitor Phil Roach—a well-known criminal lawyer who, Reeves claims, regularly acted as an intermediary between criminals like McPherson and corrupt police such as Krahe and Kelly.
Remarkably though, in spite of the seriousness of the charge against McPherson, and his extensive criminal record, magistrate Roy Harvey released him on £1,000 bail and ordered him to report to police three times a week until the Coroner's case began.
In his account of the case, investigative journalist Tony Reeves reported that, years later, an anonymous barrister who claimed to have been privy to "secretive arrangements" between lawyers, police and politicians at the time, had told him that McPherson had "donated" over $10,000 to Downing to assist in his decision.
After coming home from a drinking binge and discovering that his dinner was not ready, a drunken McPherson savagely pistol-whipped his wife, repeatedly threatened to kill her, and fired shots into the food still cooking on the stove.
Joy never returned to live with Lenny after the incident, and she subsequently divorced him, signed over her share of their Gladesville home to him, remarried and left Sydney.
That evening, McPherson allegedly slipped away from his own wedding reception at Balmain and carried out the brutal murder of a rival criminal, Robert James "Pretty Boy" Walker, at Randwick, in Sydney's east.
They waited until Walker left the woman's house at about 6:15pm, then followed him as he walked down Randwick's main street, Alison Road, on his way to a local pub.
Drawing up alongside, McPherson opened fire on Walker at close range with an Owen submachine gun, hitting him six times and killing him instantly; several shots also struck a parked car and a nearby fence.
[21] Some months later, in 1965, journalists Ron Saw and Frank Brown wrote an article about the case, published in the new satirical magazine Oz in which they alleged that a loose association of prominent Sydney criminals had clubbed together to have Walker killed because of his attempts to establish himself as a standover man.
[23] The next rival eliminated by McPherson was murderer, safecracker and standover man Robert Lawrence "Jacky" Steele, whose shooting and subsequent death became one of the most celebrated criminal cases of the period.
On the evening of 26 November 1965 Steele was fired upon by four men who approached him in a car, while he was walking down a quiet street in the affluent suburb of Woollahra in Sydney's inner east.
He received multiple gunshot wounds—including a shotgun blast that ripped a five-inch hole in his abdomen—but he survived the initial attack and he was able to stagger 200 metres back to his home and drag himself up three flights of stairs to his flat before collapsing.
In that time he briefly became a media star, and reporters interviewed him in his hospital bed, although one newspaper photographer discovered that Steele, wary of another attempt on his life, was keeping a loaded shotgun at the ready under the sheets.
Steele told a Sunday Mirror reporter that his assailants were able to surprise him by driving up to him in a car that resembled an official police vehicle, and that they were all wearing hats of a style then much favoured by detectives.
[28] McPherson continued his rise to power through the late 1960s, masterminding the bloody and highly publicized Sydney "gang wars" of the period, during which he allegedly coordinated (and occasionally took part in) the systematic murder of several key rivals.
This included the sensational 1967 car-bombing murder of brothel owner Joe Borg, and the killings of his old enemy Ducky O'Connor, and Stewart John Regan.
McPherson is also believed to have facilitated the establishment of close contact between key Australian organised crime figures and members of the Chicago Outfit, during the late 1960s.
Perhaps the most notorious of these meetings took place at Sydney, in 1969, during a visit by reputed US mafia hitman Joseph "Dan" Testa,[30] and his associate Nick Giordano.
During the Moffitt Royal Commission into organised crime, an informant alleged that Testa, as a representative of the Mafia, "was conspiring with McPherson and a poker machine company, Bally Manufacturing, to corner the New South Wales market.