Every Line is Dubbed...
Although there are many technical problems with "Gangster Story" owing to its obviously low budget - the single most glaring is the soundtrack.
Every line of dialog has been dubbed in post-production, and sometimes - as in the case of Vic Tayback - not by the original actor.
The relative accuracy of the dubbing suggests that the original dialog was recorded but that it was either of very poor quality or (more likely) it was not shot with a synced recorder or a blimped camera. What was recorded was apparently later used as a reference track for dubbing.
More than anything else, this contributes to the ultra low budget feel of "Gangster Story." There is no natural room "presence" or echo in any of the voice recordings, so they all sound just a bit creepy.
Compare this to "Plan 9 From Outer Space," which actually did have (mostly) synchronized on set recording. "Plan 9" was also largely shot on real soundstages, whereas "Gangster Story" is shot entirely on practical locations like people's living rooms. The difficulty of doing so is revealed by the limited and flat camera angles.
I hate to say it but, this all makes "Gangster Story" actually technically inferior to "Plan 9" in some respects.