The Mafia has been dealing drugs since Day One. Don Vito Cascio Ferro came to NYC in the early years of the last century in part to establish a drugs pipeline between Europe and the US. Charlie Luciano dealt drugs as a young man, and is reputed to have ratted out a partner in return for getting a pass from the cops. Joe Bonanno's "vacation" in Italy in 1957 was really a meeting with Luciano and some Sicilians to make Bonanno the top drugs guy in America. The aborted Apalachin NY meeting that year was, in part, an attempt by Vito Genovese to outflank Bonanno as the top drugs guy. He and Joe Valachi went to prison on drug charges. John Gotti was the top earner in Neil Dellacroce's empire because some of his crew dealt drugs...and on and on.

Drug-dealing puts Mafia bosses in a quandary: They know that heavy penalties are a threat to them. But they love the money that drugs bring in. They also know that a “ban” on drug trafficking in their families would be unenforceable—there is too much money and greed to stop it. They wouldn’t be able to effectively police their families: how could they know everything that every street guy was doing every hour of every day? They might be in the position of having to kill the wrong guy, or worse (from their viewpoint), a good earner. Finally, a real “ban” would simply drive the trafficking totally underground—meaning that they wouldn’t get their cut.

So the Mafia Dons fall back on the common denominator of Mob life: hypocrisy. They declare a "ban" on anyone caught selling drugs, with a death penalty for violators--and promptly look the other way--what they don't know won't hurt them. They figure that the threat will discourage the weaker soldiers, who are more likely to get caught. The more capable, ambitious guys are be willing to take the risks—and are less likely to get caught. The money continues to flow upward, which is all the bosses care about.