Green’s Dictionary of Slang

(US Und.) a trick whereby the tricksters pose as outraged citizens or police officers in order to obtain bribes from homosexuals in toilets.

1937

(con. 1905–25) E.H. Sutherland Professional Thief (1956) 78: The muzzle began as a professional racket about 1909 or 1910 in a poolroom at Forty-third and Broadway in New York City, where a group of thieves of every known variety was congregated. They talked over the possibility of making some money from the members of the third sex who were making the Fifty-first Street subway station a rendezvous for their social relations. The original application of the racket was very crude. A couple of thieves would wait until they saw two men go into a toilet together and then would break in and, finding a compromising condition, would demand money from the participants purely in the guise of outraged citizens who threatened to call in the police. As the possibilities of the racket became apparent, the thieves developed more finesse and impersonated police officers who would accept bribes to overlook the violation. From this developed the safer angle of permitting the violators to post an amount of cash as a supposed bond for their appearance in court (the violators never appearing).