The glitzy, high-stakes world of casino gambling was anything but alien to the bosses of organized crime at midcentury. The Outfit had dipped a tentative toe into those waters during the previous two decades, but the New York and Florida gangs had been the first to take the concept seriously. Although the casino enterprise was one of the few gambling ventures in which the Chicagoans were behind the curve, they would soon make up for lost time. The Outfit’s decision, in the wake of Kefauver, to go increasingly legit, was not a total transformation, however; they had not lost their habit of making truckloads of money quickly. And the illegal opportunities afforded by legal casino gambling provided the perfect link in the hoods’ evolutionary chain.
The boss who had run the gauntlet years earlier for all the gangsters who would follow was Curly Humphreys’ East Coast alter ego, the genius of the New York Commission, Meyer Lansky. After rising to the top of the New York bootlegging trade, the greatest Jewish gangster in history focused his immense talents on casino gambling. And he chose as his laboratory the tropical paradise of Cuba with its amenable president, Fulgencio Batista y Zaldivar.
A Sunny Place for Shady People
Meyer Lansky first came to Havana in the 1930s, having already earned a reputation as the owner of the best “carpet joints” in America. These gambling parlors were the first to deliver the card, wheel, and dice games from the backrooms and sawdust floors of saloons into their own dedicated, upscale nightclubs. Lansky was thus among the forefathers of the plush gaming industry, establishing clubs up and down the East Coast. Naturally, for these illegal clubs to operate in the open, the compliance of local officials was required, and Lansky, like every other gangster boss, took advantage of the inherent greed of the upperworld. With officials properly satiated, Lansky oversaw carpet joints that succeeded wildly, due in large part to their reputation for fair gaming and intolerance for cheats. These Lansky traits brought him to the attention of Cuba’s new military leader, Fulgencio Batista, a U.S. sponsored strong-arm with visions of creating a combination of Paris and Monte Carlo in the Caribbean.
Batista’s dream of a Cuban music and gambling paradise was hindered by his homeland’s notorious reputation as an unregulated haven for cardsharks and swindlers. In this free-for-all atmosphere, where come-on games with names like “razzle-dazzle” and “cubolo” flourished, casual tourists were being robbed, and serious gamblers had no reason to play in the first place. To make matters worse, the races at regime’s premier, beautiful racetrack, Oriental Park, were rightfully perceived as being fixed daily. Again, the serious bettors and horse owners stayed away. When Batista sought to remedy the scandalous state of affairs, he wisely sought the expertise of a Polish-born, Brooklyn-bred thirty-five-year-old expert with a reputation for running the most honest gambling concessions in the United States. Born Mair Suchowljansky, he was now known as Meyer Lansky, the New York head of the Commission.
Unlike the Outfit, Lansky and pals had been transshipping their bootlegged alcohol through Caribbean ports for over a decade and were well acquainted with the allure of the tropics. At the time of Batista’s takeover, Cuba’s two main gambling parlors consisted of a small, plush venue inside Oriental Park, and the classic Grand Casino Nacional nightclub, with its Greek architecture, fountains, and statues in the nearby town of Marianao. With Lansky agreeing to kick back 30 percent of the take to Batista, a successful partnership that would last for three decades was formed. Lansky more than lived up to his end of the deal, bringing his own trusted pit crews from his Florida carpet rooms, and single-handedly building a new reputation for Cuban casinos that eventually succeeded in attracting the hemisphere’s high rollers. The partnership flourished until 1944, when the new Cuban president ousted both Batista and Lansky. They both relocated to southern Florida, where they stayed close friends and neighbors, waiting until the day when the United States would reinstall Batista at the helm of his corrupt dictatorship.
During this period, the extent of the Outfit’s interest in Cuba is impossible to determine. With scant FBI (or later CIA) penetration in the offshore haven, the degree of American investments on the island has always been shrouded in mystery. However, numerous well-placed sources have emerged over the years telling a consistent story of Windy City ties to Cuba. It was widely believed that the Chicago gang had a hidden stake in Havana’s Sans Souci, Capri, and Tropicana casinos, owned in part by Santo Trafficante, Jr, the numbers boss of Florida. Trafficante, the only gangster to stay behind after Batista’s 1944 fall from power, would install a Mooney Giancana underling named Lewis McWillie as his pit boss at the Trop. McWillie would later perform the same service for Mooney at a casino hotel he secretly purchased in Reno, Nevada, in 1960. Federal narcotics agent Charles Siragusa told investigative reporter Dan Moldea that the Outfit hit man who had been indicted in the 1947 James Ragen murder was the gang’s chief liaison to all things Cuban. “Dave Yaras was probably one of the first members of the Chicago underworld to ’discover’ Florida after Capone was sent to jail,” Siragusa said. “He ran a number of gambling operations on the island [Cuba] and was also the Chicago mob’s liaison to the Cuban exile community after the fall of Batista.”
Other Outfit members had maintained a presence in the Cuban paradise. As captured in photos in extant family albums, Curly Humphreys had been traveling with his family to Cuba at least since the early 1940s. Likewise, it was oft reported that Joe Accardo enjoyed regular deep-sea-fishing vacations to Cuba and other Caribbean destinations. However, it is unknown if they conducted gang business on these outings. Despite the dearth of offshore intelligence, hints of the Chicago gang’s growing interest can be seen most conspicuously in the movements of Johnny Rosselli, always the most visible of the core Outfit members.
After the Kefauver circus, Johnny Rosselli’s star began to dim in Tinseltown. When his friend Brian Foy left Eagle Lion Studios, the owners let Rosselli’s contract expire, while Johnny’s parole adviser was telling him that the best way to avoid suspicion was to hold down regular employment. The loss of the Eagle Lion gig was stressful, but it was the dismissal of Johnny by his longtime pal Harry Cohn of Columbia that convinced “Mr. Smooth” to seek out greener pastures. Cohn stunned Rosselli when he refused to give him a producer’s job on the studio lot. “Johnny, how could I give you a job?” Cohn asked. “The stockholders would scalp me.” “You’re a rotten shit,” an angry Rosselli fired back. “Did the stockholders complain when I got ten years of prison because of you?”
There is some compelling evidence that before Rosselli abandoned Flollywood he managed to redress his snub by Cohn. At the time, the once meteoric career of gangster hanger-on Frank Sinatra was in free fall. With his voice in great disrepair, his marriage to Ava Gardner failing fast, and his MGM film contract recently canceled, “The Voice” was believed by his closest friends to be on the verge of suicide. Meanwhile, Harry Cohn was casting for the World War II film From Here to Eternity. Sinatra had read the book and was obsessed with landing the role of Private Angelo Maggio, a scrawny Italian-American soldier with a heart bigger than that of GI Joe. It was believed at the time that the film would be awash in Oscar nominations the following year, and Sinatra envisioned the film’s resuscitating his flagging career. The trouble was that Harry Cohn wanted only legitimate seasoned actors to read for the part.
Sinatra managed to sit down with Cohn, and over lunch the producer pulled no punches. “Look, Frank, that’s an actor’s part, a stage actor’s part,” Cohn told the crooner. “You’re nothing but a fucking hoofer.”
Dismayed but not yet resigned to defeat, Sinatra had his white-hot actress wife, Ava Gardner, lobby his case with Cohn’s better half. Other friends were conscripted into the cause, but Cohn gave little indication that he was interested in Sinatra. At this point, according to a number of well-placed sources, Sinatra enlisted the aid of the Outfit’s Johnny Rosselli. News reports initially surfaced that noted New York Commission boss Frank Costello was telling friends that his longtime pal Frank Sinatra had approached him for help with the Cohn situation. Columnist John J. Miller told writer Kitty Kelley that this was not uncommon. “Sinatra and Frank C. were great pals,” Miller remembered. “I know because I used to sit with Frank C. at the Copa and Sinatra would join us all the time. He was always asking favors of the old man, and whenever Sinatra had a problem, he went to Frank C. to solve it.” Apparently, this newest accommodation was facilitated by the Outfit’s Johnny Rosselli.
Although studio executives have denied that a Rosselli intervention ever took place, Rosselli admitted his role to his niece shortly before his death many years later. Former publicist and Rosselli pal Joe Seide said in 1989 that one of Costello’s key men told him how he had flown to L.A. to enlist the Outfit’s Rosselli in the cause. According to Seide: “The Maggio role, Sinatra wasn’t going to get it. There were no two ways about it . . . Johnny Rosselli was the go-between. Johnny was the one who talked to Harry - he was the one who laid it out. That was serious business. It was in the form of ’Look, you do this for me and maybe we won’t do this to you.’ . . . It wasn’t even a secret in the business.”
To no one’s surprise, From Here to Eternity was nominated in ten categories for the 1953 Academy Awards, winning eight of the coveted statuettes. Among the winners was Frank Sinatra for Best Supporting Actor. And as he had hoped, Sinatra’s career took off and the singer never looked back. The pivotal role Rosselli played in Sinatra’s turnaround, if in fact it happened, goes a long way toward explaining their lifelong friendship, which began about this time. The episode might also account for Sinatra’s dutiful obliging of Humphreys’ daughter when she needed a date for her high school dance. It was the least he could do for a gang from Chicago who had changed his life forever.
The alleged Rosselli-Sinatra incident was fictionalized in the 1969 novel The Godfather (which the Outfit played a key role in getting made as a movie, as will be seen). In that telling, a down-in-the-dumps Italian singer named Johnny Fontaine had his mob sponsors make a studio head “an offer he couldn’t refuse” in order to land their boy a plum film role. In the movie version, the mogul woke up to the sight of his prized racehorse’s severed head in his bed.1
The Outfit’s Emissary Goes Tropical
Rosselli’s friends in Hollywood had not deserted him socially, but they drew the line at having professional relationships with the now infamous ex-con. Thus the Outfit’s travelling emissary set out to conquer new worlds, simultaneously smoothing the way for his associates in Chicago. The top spot on Johnny’s new itinerary was Cuba.
Although his presence on the island is mentioned in only one FBI document, Rosselli’s business expansion into Cuba, as recounted by numerous associates and government agents, is undeniable. The timing for Rosselli and the Outfit could not have been better, since in 1952, Batista-Lansky had retaken the island nation and made up for lost time in establishing their Caribbean Monaco. Batista quickly placed Lansky in charge of gambling at the plush Montmartre Club and the more modest Monseigneur Club, both in downtown Havana. As Batista’s “adviser on gambling reform,” Lansky took an above-the-table retainer of $25,000 per year, and untold millions below. His money-counting crew had a saying that would become a mantra in Las Vegas: “Three for us, one for the government, and two for Meyer.”
Lansky next installed a casino in the elegant ten-story Nacional Hotel, over objections by expatriate Americans such as Ernest Hemingway, who viewed the placid, noncommercial gardens of the Nacional as their private club. Designed by art deco icon Igor Plevitzky, who also drew the plans for The Breakers in Palm Beach and The Biltmore in Coral Gables, the Nacional was (prior to Lansky-Batista) the last place one would expect to find the gambling ilk. With its manicured lawns on a bluff overlooking Havana Harbor, the Nacional had been the perfect setting for afternoon teas and bridge parties for the leisure class. But the avaricious Lansky-Batista changed all that with the addition of a bar, a showroom, and a casino. The Cuban gold rush was now on, and the Outfit’s interests were represented by Los Angeles exile Johnny Rosselli.
In her autobiography, Mooney Giancana’s daughter Antoinette remembered her father “constantly hopping a plane” for Havana in the years before her mother’s death in 1954. As Antoinette recalled: “Sometimes he was with Accardo, or the Fischettis, or Gus Alex, or Johnny Rosselli. Rosselli managed one of the Cuban hotel casinos, the Sans Souci, with the boss of the Florida crime family, Santo Trafficante.”
When Trafficante testified before the House Select Committee on Assassinations in 1978, he admitted having known Rosselli since at least 1945. That same committee referred to government sources who, like Antoinette Giancana, knew that Rosselli “had a management role” in the Sans Souci. In 1990, the former casino floor manager at the Nacional, Refugio Cruz, said in an interview that he saw Rosselli there several times in the midfifties, dining with Lansky. “It was as if royalty was visiting,” the Cuban recalled. Likewise, an anonymous source told Rosselli’s biographers that he was hired by Rosselli during the same period to oversee publicity for acts appearing in some of Havana’s casino showrooms. The FBI believed that Rosselli, like Dave Yaras, had also coordinated hidden investments for the Outfit in Cuban gambling.
The lack of FBI surveillance in Cuba effectively curtails further investigation into the specifics of the Outfit’s Cuban casino investments. However, the steady growth of the gang’s fascination with gambling in the Nevada desert is well documented.
The Outfit Explores the Green Felt Jungle
When the subject of the Las Vegas casino boom is broached, invariably the first name that comes to mind is that of Meyer Lansky’s partner Ben “Don’t Call Me Bugsy” Siegel, whom many credit with creating the industry when he built his Flamingo Hotel-Casino in 1946. But in financing Siegel’s dream, Lansky’s Commission (which included the Outfit) was acting on the groundwork laid two decades earlier by none other than Curly Humphreys, Johnny Rosselli, and the Big Guy himself, Al Capone. And the Outfit’s interest in the desert oasis demonstrated once again the gang’s uncanny prescience and survival skills, talents that saw them beat the upperworld to still another pot of gold. It is a certainty that, as early as the 1920s, someone in Chicago’s empire of crime was versed in the history of the desert Southwest, a history that made the locale ripe for Outfit expansionism. (See gambling appendix.)
In the early twentieth century, the combined effect of the nation’s Depression and the depletion of the southern gold and silver mines sent Nevada officials scurrying to invent ways to revive the state’s flagging economy. While the locals debated remedies, the U.S. Bureau of Reclamation was about to break ground on a project that would propel much of the Southwest into an era of prosperity. For over twelve years, federal officials had argued over what to do about the disastrous periodic flooding of the fourteen-hundred-mile-long Colorado River. Finally a bold plan was approved that would, if successful, not only tame the Colorado, but provide water and hydroelectric power throughout the West: The government moved to construct the world’s largest dam thirty miles to the southeast of Las Vegas. Since no city can grow without an adequate water supply, the construction of the massive Hoover Dam, which broke ground in 1931, went a long way toward making the idea of Las Vegas viable. The project had the ancillary benefit of employing more than five thousand workers, many of whom relocated to Nevada from out of state.2 With so many hardworking, hard-partying laborers spending their paychecks in nearby Las Vegas, the predictable vices once again flourished, happily tolerated by officials.
Much as Roosevelt would call for a repeal of Volstead in order to avail the economy of an alcohol-tax windfall, so too did Nevadans start talking of legalizing gambling. One editorial writer for the Reese River Reveille summed up what many were thinking: “If we are going to have gambling . . . let’s have it in the open and be honest with ourselves. Regulate the thing and use the revenue for some good purpose.” This was happening at the same time that the Outfit, preparing for the end of prohibition, was casting about for “the new booze.” With their racetrack maven Johnny Patton already operating illegal dog tracks outside Reno, the Chicago bosses, like the Nevada upperworld, concluded that a legalized-gambling mecca would allow them to expand their race operations and construct gambling joints. It now appears that the Outfit dipped into its treasury to persuade any statehouse holdouts of the wisdom of wide-open gambling.
By the time Nevada governor Fred Balzar signed the law legalizing gambling on March 19, 1931, there were already whispers that some state legislators had been the recipients of graft from gambling entrepreneurs. As A. D. Hopkins wrote in a 1999 article in Las Vegas’ Review Journal:“It is commonly believed that cash was spread around to lubricate the passage of casino gambling in 1931, but the source of that money has long been the subject of speculation.” Of course, if Chicagoans were involved in such a thing, it was a good bet that Curly Humphreys, the Outfit’s political payoff mastermind, would have been the coordinator. The FBI’s massive file on Humphreys notes his constant travel to grease the skids for Outfit business. In one example, Humphreys traveled to New York State to bribe legislators to repeal the Sullivan Act, which forbade ex-cons from carrying a weapon.3 Irv Owen, a Norman, Oklahoma, native and retired attorney who had known Humphreys’ extended family and friends since 1937, recently made the emphatic statement that he knew exactly how the Wide Open Gambling Bill came to be enacted. “In the 1930s, Humphreys and his protege Johnny Rosselli [whom Curly always called the Hollywood Kid] bribed the Nevada legislature into legalizing gambling,” Owen said. “Las Vegas owes everything to Murray Humphreys.” Regarding Outfit money passing under the table at Carson City, Owen was recently corroborated by John Detra, the son of one of Las Vegas’ earliest gambling-club owners.
John Detra’s father, Frank Detra, had moved from New York to Las Vegas in 1927. A year later, according to his son John, thirty-one-year-old Frank Detra and his family began receiving visits from none other than Chicago’s Al Capone, then twenty-eight years of age. Although John has no knowledge of how the two met, it was clear to him that they were close friends. (It is possible that the friendship goes back to New York, since both men were there at the same time and were of the same age.) The younger Detra still retains a gold pocket watch Capone gave his father, the back of which bears the inscription “Franco Amici Alphonse,” which translates as “Frank and Alphonse are friends.” Detra and Capone were obviously planning a business partnership, says John.
After a brief stint as a dealer in downtown’s Boulder Club, Detra was staked by a still unidentified Eastern entity to build his own club five miles outside the city line, on a section of old Highway 91 (the future Las Vegas Boulevard) that would later be named The Strip. His club, The Pair-O-Dice, would make history as the Strip’s first upscale carpet joint. In the vicinity at the time, there was only The Red Rooster sawdust roadhouse. Although Detra’s club was a speakeasy of sorts (a password was needed to enter), it boasted all the refinements of Vegas lounges that would hold sway three decades later. Open only at night, the Pair-O-Dice featured delicious Italian cuisine, jazz and dance bands, fine wine, and, of course, table games. To keep the operation afloat, the requisite bribes were in force. “The old man went to town every month with envelopes, several of them, and came back without the envelopes,” John says.
When the 1930 debate over gambling legalization was joined, young John began accompanying his father as he made deliveries of cash-stuffed briefcases and envelopes to influential Nevadans across the state. Frank Detra admitted to his son that the money was being spent to ensure the passage of the Wide Open Gambling Bill. John believes the money had to have come from the Capone gang, since Capone was the only major player close to his father. John was aware that some monies were being paid to state legislators, but his father’s role may have been even more critical to the pro-gambling strategy: Frank Detra’s contacts superseded the local power brokers. “They were all federal people, top-drawer people who influenced the state people,” John remembers. On one trip to Reno, John was asked to make the delivery himself. “Dad gave me a little briefcase and said, ’See that house over there? Go ring the bell,’” John recently remembered. “I went over and rang the doorbell, and a man came to the door and said, ’Oh, thank you,’ took the suitcase and closed the door.”
After gambling was legalized in 1931, Frank Detra openly operated the Pair-O-Dice until 1941, when he sold the business to Guy McAfee, who incorporated the club’s structure into his Last Frontier Club. Detra, who died in 1984, went on to operate clubs in Reno and Ely.
Outfit associates not only moved quickly to open the first legal upscale nightclubs like the Pair-O-Dice, but also established Nevada’s first casino-hotel. After gambling legalization, Las Vegas city commissioners issued only seven gambling licenses for downtown clubs, most of which had maintained illegal gambling operations for years. Among the license recipients were the Boulder Club, where Frank Detra had briefly worked as a dealer, and the Las Vegas Club.4 Club owners with Outfit affiliations were among the first to cash in on the Las Vegas gambling rush. On May 2, 1931, Johnny Rosselli’s bootlegging partner from Los Angeles, Tony “The Hat” Cornero, opened Las Vegas’ first legal hotel-casino, The Meadows, just east of the city. Unlike the small, sawdust-coated downtown casinos on Fremont Street, Cornero’s place was a Lansky-like “carpet joint,” but combined with well-appointed hotel accommodations. The May 3 Las Vegas Age newspaper described the Meadows: “Potent in its charm, mysterious in its fascination, the Meadows, America’s most luxurious casino, will open its doors tonight and formally embark upon a career which all liberal-minded persons in the West will watch closely.”
Although visionary, The Meadows was a huge gamble for the Depression era. In southern Nevada especially, there were not yet enough well-to-do patrons to sustain the business. In just a couple years, The Meadows closed, only to reopen as a high-class bordello. Cornero would resurface in the 1950s to open another Vegas hotel-casino, the Stardust, which was quickly appropriated by the Outfit.
The Outfit’s fingerprints can be seen in other parts of the state in the immediate aftermath of legalization. In downtown Reno, a large crew of laborers began tearing out the walls of adjacent buildings on Center Street even before the bill was signed. The gambling parlor that would occupy the space in a matter of days was John Drew and Bill Graham’s Bank Club. According to Chicago FBI agent Bill Roemer, Joe Accardo had given Drew his start at Joe’s Owl Club in Calumet City, Illinois, before dispatching Drew to Reno to manage the Bank Club. Bryn Armstrong, former chair of the Nevada State Parole Board, revealed in a recent interview that none other than Johnny Rosselli, a good friend of Graham’s, represented “hidden financial interests” (read “the Outfit”) in the Bank Club. Graham was likely critical for the legalization push in the first place, since, according to Rosselli’s autobiographers, “he knew every politician in the state and could obtain licenses and government concessions when other men could not.”
Despite their best efforts and visionary concepts, Outfit liaisons such as Detra, Cornero, and Drew were ultimately the victims of bad timing. The nation’s depressed economy kept the number of available affluent high rollers to a minimum. Economic conditions around Las Vegas were even worse, since after the Hoover Dam was completed in 1935, the area saw the exodus of the five-thousand-man workforce and their families. The situation thus remained in stasis as Vegas once again became synonymous with low-rent dude ranches, cowboy casinos (with gamblers’ horses harnessed out front), and sawdust-floored gambling roadhouses. Out-of-towners were dispossessed of a bit more cash by state legislators, who passed no-fault quickie-divorce codes. But roadhouse gambling and quickie divorces were not panaceas for a flat state economy. However, redemption would come soon after World War II in the form of a handsome New York hoodlum who had been peddling the Outfit’s Trans-America wire service to the downtown gambling joints. The movie-star-handsome thug came up with the best scam idea of his life: He decided that the time was right for Las Vegas (and the Commission) to revisit the hotel-casino notion pioneered by Tony Cornero in 1931 with The Meadows. With the Chicago-New York Commission’s financial backing, Ben Siegel gave new life to Nevada while ironically sacrificing his own. In doing so, the fortunes of Nevada, and particularly Las Vegas, would forever improve.
The Bugsy One
He is best remembered as Meyer Lansky’s childhood pal and crime partner. Together with Meyer, Brooklyn-born Benjamin Siegel graduated from terrorizing pushcart vendors for chump change to organizing the infamous murder-for-hire racket known as Murder, Inc. By the age of twenty-one, Siegel was said to have perpetrated every crime in the book, including white slavery, bootlegging, hijacking, robbery, rape, extortion, narcotics running, and numerous contract murders. Ben Siegel’s hooligan thoroughness was equally matched by his borderline pathological outbursts, which earned him the nickname Bugsy, a moniker no one dared use in his presence. Until the end of his life, Siegel was known to pistol-whip those who committed the transgression, regardless of whether the faux pas occurred in private or by a crowded Las Vegas poolside. Lansky once said of his childhood friend, “When we were in a fight, Benny would never hesitate. He was even quicker to take action than those hot-blooded Sicilians, the first to start punching and shooting. Nobody reacted faster than Benny.”
By 1936, the thirty-year-old Siegel himself became a marked man in New York, much as had Al Capone, after committing an ill-considered high-profile gang rubout (that of Tony Frabrazzo). Instead of boarding the New York to Chicago underground railroad like Capone, Siegel was ordered to Los Angeles by his superiors, Lucky Luciano and Meyer Lansky. It was a fitting venue for the movie-star-handsome Siegel, whose legendary vanity was right at home in a city that had turned self-love into an art form. Soon after his arrival, Siegel hooked up with another transplanted Brooklyn pal who had already scored in Hollywood, actor George Raft. Siegel also made the acquaintance of the town’s social lioness, Countess Dorothy Dendice Taylor di Frasso, who became one of Siegel’s countless lovers. With the well-placed Raft and di Frasso as his connections, a starstruck Siegel soon met celebrities like Clark Gable, Jean Harlow, Gary Cooper, and many others. Through Johnny Rosselli, Siegel met studio barons like Harry Cohn and Louis Mayer, and labor thug Willie Bioff. And although Siegel had relocated to Hollywood with his wife and daughters, he bedded more starlets than most single lotharios.
Siegel quickly established himself financially, since Luciano had greased the skids by ordering Los Angeles boss, and Rosselli associate, Jack Dragna to partner in his lucrative gambling and labor racketeering operations with the outcast Siegel. “Benny is coming west for the good and health of all of us,” Luciano had told Dragna. Expanding his empire, Siegel formed a partnership with another Rosselli cohort, Tony Cornero, and began fronting for the Outfit’s Trans-America wire service, scattering agents throughout the Southwest. Siegel guaranteed his new empire’s success by bribing countless state politicians and law enforcement officials, all the way up to the state attorney general’s office.
Bugsy Siegel’s selection as the Outfit’s wire representative in the Southwest was understandable: He had known the gang’s patriarch, Big Al Capone, since both their formative days in the Williamsburg section of Brooklyn, where they had worked in consort as strikebreaking thugs for garment-industry upperworlders. When Capone had come under intense heat from rival Arthur Finnegan in 1920, he had gone into hiding with one of Siegel’s aunts before subsequently making for Chicago. In later years, Al entertained Siegel at his Palm Island estate in Florida.
Siegel took to the superficiality of Tinseltown as though he had been born there. His vainglory now in overdrive, Siegel began dressing in custom-made designer clothes, every item of which was monogrammed; he took acting lessons; he combed his hair every five minutes; and he applied face creams and eye shades nightly. Once, when George Raft sent him a toupee as a joke for a birthday present, Bugsy drove over to Raft’s house in a rage and screamed at the actor, “I oughta shoot you, you motherfucker!”
Inevitably, Bugsy’s voracious sexual appetite drew him to his female alter ego, the Outfit’s money courier/spy/nymphomaniac, Virginia Hill. Opinions vary as to how the pair met, but since they floated through the same New York/Chicago/Los Angeles hoodlum cliques, their meeting was inevitable. According to Joe Adonis (Doto), New York gambling boss and Commission partner of Lansky’s and Luciano’s, he set Hill up with Bugsy. As he told UPI correspondent Harold Conrad in 1946, “Great broad, but she was out in front all the time, giving orders and fighting me for the dinner checks. That can de-ball you when you got a broad always grabbing the checks. So I hedged her off to Benny.”
As unstable as Bugsy’s, Hill’s fiery temper matched that of her paramour slug for slug. The tempestuous pair became known for their furious rows, after which the regularly bruised Hill would often attempt suicide by overdosing. To their friends, Bugsy and Virginia explained that the painful fisticuffs were more than ameliorated by their conjugal bliss, which was said to feature explosive sex. In later years, this woman of a thousand liaisons never hesitated to say, “Benny was the best sex I ever had.” During rare moments of solitude, Virginia called Siegel “Baby Blue Eyes,” while Siegel gave her the pet name Flamingo, referencing her red hair and long legs. Although Hill assisted Siegel in setting up a Mexican narcotics pipeline, she never relinquished her allegiance to the Outfit, and especially her Chicago handler, Joe Epstein. Through Epstein-Hill, Ac cardo and Humphreys were kept well informed of Siegel’s management of their affairs.
The Vegas Idea
In 1941, just after the race wire was legalized in Nevada, Siegel sent his aide and lifelong Brooklyn friend Moey Sedway to Las Vegas with a charge to install the Outfit’s Trans-America wire service in the downtown Vegas haunts of the serious gamblers - casinos such as the Golden Nugget, Horseshoe, Golden Gate, and Monte Carlo. The task was virtually effortless, since the “Glitter Gulch” casino owners saw bookie wagering as a draw and hoped that in between races the bettors would sample the other games of chance on-site.
The money was huge. In no time, Siegel was receiving a $25,000-per-month cut from the Las Vegas wire alone, which he called the Golden Nugget News Service. Sedway became a civic-minded philanthropist, who, for a time, considered running for public office - that is, until Bugsy set him straight. In a typical fit of rage, Siegel screamed at Moey, “We don’t run for office. We own the politicians.”
Soon, Siegel let Sedway in on another secret, when, on a 115-degree summer day in 1945, he drove Moey out of Las Vegas on Highway 91. About five miles out, they pulled to a stop in the middle of nowhere, and Bugsy pointed to a couple of dilapidated buildings, leaving Moey befuddled.
“For God’s sake, Ben. What is it?” Moey asked “
Thirty acres, Moe,” said Siegel. “Thirty acres for a few nickels and dimes.”
After Sedway had questioned his buddy’s sanity, Siegel described his master plan: “Moe, we’re going to buy this hunk of land. And we’re going to build the goddamnest biggest hotel and casino you ever saw. I can see it now. ’Ben Siegel’s Flamingo” - that’s what I’m going to call it. I’m going to have a garden and a big pool and a first-class hotel. We’re going to make Reno look like a whistle-stop.’
In truth, Siegel’s vision, like so much else in his life, had been stolen, this time from one of Johnny Rosselli’s best friends, Billy Wilkerson. As the publisher of The Hollywood Reporter and the owner of successful L.A. nightclubs on the Sunset Strip, Wilkerson had hoped to create a new “strip” on the Las Vegas outskirts. After Wilkerson made the initial land purchase, his financing fell through. Enter Bugsy Siegel. Wilkerson’s gangster friend not only agreed that the time was right to revisit the idea of Tony Cornero’s ahead-of-its-time Meadows, but Siegel knew that he could avoid haggling with city commissioners for a casino license if he built his dream outside the Las Vegas city limits. Siegel estimated that his pleasure palace would need $1.5 million in financing. In no time, Siegel, as majority stockholder, formed a partnership with Wilkerson and a handpicked group of other investors, such as Meyer Lansky, who chipped in an initial $25,000, adding $75,000 more later. Years later, the FBI would learn that there was also a hidden partner in the Flamingo project. As Chicago FBI agent Bill Roemer recounted, “We learned how Hump [Curly Humphreys] went there in 1946 to assist Bugsy Siegel in establishing the first hotel-casino on what is now known as the Strip . . . Hump worked with Siegel, Meyer Lansky, and others of the New York mob putting the Flamingo together . . . Chicago gained an early foothold in Vegas through Humphreys” work.’ Two decades later, the FBI would listen via hidden microphones as Curly recounted this period to a protege named Gus Alex. “I was there when Bugsy Siegel was there,” Humphreys said. “[Contractor Del Webb] was the big boss there at the time, ’cause he used to sit with Bugsy Siegel when Bugsy was building that joint, you know? And I sat there with him. He used to come over and meet Bugsy every morning.”
By 1948, Virgil Peterson of the Chicago Crime Commission had determined the exact amount of the Outfit’s investment in Siegel’s operation. In a letter to the Nevada Gaming Commission, Peterson notified the Nevadans that, via the Fischetti brothers, Chicago had transmitted over $300,000 to Bugsy. If the figure is accurate, it would make the Outfit the most substantial shareholder in the Flamingo, since the largest investor of record, Siegel, had endowed only $195,000.
At about the same time that ground was broken on the new casino (December 1945), Bugsy received bad news that presaged his coming downslide into tragedy: His long-suffering wife, Esta, had finally filed for divorce in Reno. The adulterous Siegel was remorseful in his decision not to fight Esta, and he readily agreed to pay her a settlement of $600 per week for life, a staggering amount at the time. Back at the job site, the inexperienced Siegel was being robbed blind by his subcontractors, who marked up their raw-material costs or stole material off the site at night only to resell the same products to Siegel the next day. During the construction, Siegel’s chief builder, the popular Del Webb of Phoenix, picked up a key insight into his employer’s psyche. In conversation with Webb, Siegel let on that he had personally killed twelve men. “He must have noted my face, or something,” Webb later recalled, “because he laughed and said that I had nothing to worry about. ’There’s no chance that you’ll get killed,’ he said. ’We only kill each other.’”
Siegel’s flair for extravagance contributed to the project’s spiraling cost overruns. His insistence on using only the best imported marbles and woods was made all the more unrealistic given postwar supply shortages. With costs skyrocketing, Siegel obtained emergency moneys from his Hollywood friends such as George Raft, but he needed more than they could produce, so Bugsy went East to secure additional investment from his gang friends. With Lansky’s approval, and Siegel’s passionate guarantees of success, the New York Commission staked Siegel an extra $5 million.
As the Flamingo absorbed money like a black hole throughout 1946, rumors began to waft eastward that Siegel was skimming the gangs’ investment. Although one of the goals of the Flamingo enterprise was to skim money off the top of losers’ trove before the owners were assessed for taxes, some Commission and Outfit members began to suspect they were the ones being taken for a ride. Under pressure, Bugsy decided to open the casino even before the hotel was completed. When the big day arrived on December 26, 1946, everything seemed to conspire against Siegel. Bugsy had spared no expense for entertainers such as George Jessel, Rose Marie, George Raft, Jimmy Durante, and Xavier Cugat’s Orchestra. In 1996, Rose Marie recalled her stint at Bugsy’s place: “The show was spectacular, everything was great, but no locals came. They were used to cowboy boots, not rhinestones. Las Vegas was cowboy hotels; this was Monaco . . . We worked to nine or ten people a night for the rest of the two-week engagement.” But despite his best efforts, Siegel was thwarted by Mother Nature and local politics, the combination of which guaranteed the Flamingo’s opening would be a disaster. In Los Angeles, a winter storm grounded the two planes Siegel had chartered to ferry celebs to the gala; those who did arrive, such as Clark Gable, Lana Turner, and Joan Crawford, either drove the 350 miles from L.A. or took a train. While in Nevada, most local gamblers, accustomed to the sawdust joints, had no desire to don dinner jackets and buy overpriced drinks merely to play a round of blackjack.
Although most of the serious players were in absentia, those who did show appeared to have entered into a conspiracy against Siegel and the Flamingo. Some owners of competing downtown casinos tried their luck at the tables, and with the collusion of some of the dealers, beat the house consistently, a virtual impossibility. When Siegel learned of one big cheat, he had to be restrained after screaming, “I’ll kill that son of a bitch.” (Ironically, one of the only big losers, to the tune of $65,000, was Siegel’s pal George Raft.) It thus came as no surprise that the Flamingo lost $100,000 in its first ten days.
Frantic to stop the casino’s money hemorrhaging, Siegel closed the operation down in January for six weeks, affording him time to complete hotel construction and repopulate his pit crewrs. In April, Siegel took Virginia Hill to Mexico, where, it is widely believed (but has never been proven) that the two married. When the casino reopened in March, it was a rousing success, so much so that it reported a $250,000 profit by June. However, all was not well in the inner sanctums of his powerful backers. Back East, both the Chicago Outfit and the New York Commission remained convinced that much of their combined $5-million investment had found its way into Siegel’s and Hill’s Swiss bank accounts. In California and Nevada, smaller investors held similar grudges. In addition, West Coast bookies were also infuriated, because they were now forced to buy both the Outfit’s Continental and Siegel’s Trans-America.
And Bugsy had still other problems nipping at his heels. A number of powerful gangsters, including Joe Epstein, were furious over Siegel’s continued battering of Virginia Hill, the gang’s courier and spy whom Epstein and the Outfit had been bankrolling for over a decade. One key adviser to a Commission founder recently stated in no uncertain terms that his boss (whom he asked not be named) had told him that Siegel’s treatment of Hill was the straw that broke the camel’s back. “Just before Bugsy was killed,” says John DeCarlo (pseudonym), “he had beaten the hell out of Virginia, who had carried on a secret affair with my boss. To this day, only a handful of people are aware of the relationship. When Virginia showed him what Bugsy had done, the contract went out.”
Although DeCarlo is reluctant to name his boss, one other knowledgeable Angeleno is not. Screenwriter Edward Anhalt (The Pride and the Passion, Becket, Jeremiah Johnson, Not as a Stranger, etc.) recently recalled a conversation with the Outfit’s West Coast negotiator, Sid Korshak, who also represented Bugsy Siegel. Anhalt had sought out Korshak with the intent of getting background for a possible film on Siegel.
“You know all that bullshit about Ben being killed because he spent too much money?” Korshak asked. “Absolute fiction.” Korshak then gave the same rationale as DeCarlo, only he added one more detail. The man who ordered the contract was Hill’s first lover, “the guy from Detroit . . . the guy from the Purple Gang.” The only man from the Purple Gang with the power to order such a hit was none other than future Las Vegas sachem Moe Dalitz, about whom more will be seen. “He was very offended by it [Siegel’s battering of Hill],” said Korshak. “He warned Siegel, and Siegel paid no attention to the warning, and they whacked him.”
Unbeknownst to both Anhalt and DeCarlo is a paragraph from the recently released FBI file on Siegel: “Early in June 1947, Siegel had a violent quarrel with Virginia Hill at which time he allegedly beat her so badly that she still had visible bruises several weeks later. Immediately after the beating she took an overdose of narcotics in a suicide threat and was taken unconscious to the hospital. Upon recovery she immediately arranged to leave for an extended trip to Europe.”
And there was more. Another of Bugsy’s egregious foul-ups was the cavalier manner with which he had been addressing the Outfit’s cash cow, the wire service. Bugsy’s Chicago employers had been telling him for months to surrender the Trans-America wire service, which they no longer needed since seizing Ragen’s Continental. When Joe Accardo personally ordered Siegel to relinquish his outlets, Siegel unwisely balked at the directive, attempting instead to extort his Chicago boss by telling him he could have Trans-America back for $2 million.
Given all the backroom disparaging of Siegel, Bugsy’s ears must have been on fire. For the most part, the complaints slid away like water off a duck, but when Siegel learned that the Commission had discussed his fate at the Christmas, 1946, Havana conference, to which he was not invited, he was seized with fear. As recounted by Ed Reid and Ovid Demaris in The Green Felt Jungle, Siegel flew to Havana to beg the deported supreme Mafia boss Lucky Luciano for more time. Supposedly, Luciano was intransigent.
“Look here, Ben,” Luciano said. “You go back there and start behaving. You give the Chicago boys the wire and no more bullshit. Those boys are fed up. This has gone far enough. You understand?”
“You bastard,” Bugsy screamed back, “No one dismisses me. And no son of a bitch tells me what to do. Go to hell and take the rest of those bastards with you. I’ll keep the goddamn wire as long as I want.”
Quite possibly there was no one reason for the rubout of Ben Siegel. His numerous offenses may have had a cumulative effect that forced his bosses to say “Enough is enough.” With so many aligned against Siegel, there was little shock among insiders when the events of June 20, 1947, transpired. On that balmy southern-California evening, Bugsy was sitting with local hood Alan Smiley in the living room of a Beverly Hills mansion (810 Linden Drive) rented by Virginia Hill, where he had arrived from Las Vegas that very morning. While talking with Smiley and reading the Los Angeles Times, Siegel was shot four times by a gunman positioned outside the living room window. Hit twice in the face and twice in the chest by slugs from a .30-caliber M-l, the forty-one-year-old Bugsy died quickly, or as Flamingo comic Alan King put it, “Bugsy took a cab.” Alan Smiley later told a Chicago friend, “His right eye flew right past my face.” It was found by police fifteen feet away on the dining room floor. John DeCarlo said that the blasts to Siegel’s face were no coincidence, but poetic justice for his disfigurement of Hill’s visage. “ ’A face for a face’ was what I was told,” says DeCarlo.
If Siegel lived long enough to feel the first shot hit him, it surely came as no surprise. The previous day in Vegas, he had been stalked by four underworld goons, who consistently missed him by minutes. Throughout that day, the Flamingo received anonymous long-distance phone calls, with the caller warning Siegel, “Bugsy, you’ve had it,” before hanging up. On that same day, Siegel gave his bodyguard, Fat Irish Green, a briefcase that government investigators believe held as much as $600,000. Siegel informed a stunned Green, “If anything happens to me, you just sit tight and there’ll be some guys who’ll come and take the money off your hands.”
Twenty minutes after the shooting, before police even arrived, the Outfit’s Phoenix bookie chief, Gus Greenbaum, along with Moey Sedway and Morris Rosen, walked into the casino at the Flamingo and announced that they had taken over. The next day, Virginia Hill’s Chicago paymaster, Joe Epstein, arrived to do the books.
Over the next year, Greenbaum used $1 million in borrowed Outfit money and bank loans to enlarge the hotel’s capacity from ninety-seven to more than two hundred rooms. It turned out to be a good investment, since in its first year the Flamingo showed a $4-million profit, skim not included. Although Greenbaum did a brilliant job as the Flamingo’s manager, his own alcohol and gambling addictions would ultimately produce tragic results. In the meantime, Greenbaum was proclaimed the first mayor of Paradise Valley - or the Strip.
Typically for gangland rubouts, Siegel’s murder, the first ever of a Commission board member, was never solved, but “solutions” to the Siegel killing were as numerous as his enemies. Some have claimed to know that Lansky or Luciano or Accardo or local Las Vegans ordered the hit. Lansky, for his part, strongly denied any sanction of his lifelong friend’s murder. Shortly before his own death in 1983, Lansky told writer Uri Dan, “If it was in my power to see Benny alive, he would live as long as Methuselah.” One piece of evidence, long buried in the files of the Chicago Crime Commission, seems to tilt the possibilities in favor of the Outfit, which was seething over Bugsy’s theft of its lucrative wire. The artifact is a letter originally mailed to Beverly Hills police chief Clinton H. Anderson from Chicago three weeks after Siegel’s slaying. The unsigned letter read:
Here is the real inside on the Bugsy killing. One week before he was killed, Murray Humphries [sic], a Capone gangster, and Ralph O’Hare one of the mob’s front men, were at the Beverly Wilshire Hotel under phoney names. The story is that Bugsy owned the Golden Nugget News Service in Las Vegas. He owed the Trans-America Wire Service $25,000. O’Hare was the head of that outfit which the Capone gang owned. It seems there was quite an argument in Humphries room when Bugsy stalled about the 25 G’s. Humphries told him to pay O’Hare the dough or he would have a lot of bad luck.
The “Ralph O’Hare” mentioned in the missive was actually Ralph J. O’Hara, the kingpin appointed by the Outfit to run the day-to-day affairs of its wire service. Police Chief Anderson also learned that Bugsy’s Baby, Virginia Hill, had been ordered by the Outfit back to Chicago on June 10, ten days before Siegel’s murder. From there she traveled to Europe, where some mistakenly believed she begged Lucky Luciano to intercede on her lover’s behalf. In fact, according to both the FBI and John DeCarlo, Hill went to Europe to recuperate from her recent savage beating by Siegel and possibly undergo plastic surgery. In the days after the Siegel killing, Chief Anderson gave a series of press statements in which he hypothesized about the ultimate authors of the murder: “There was money - a lot of money behind this killing. It wasn’t just a cheap gambling murder, you know. I do not believe that Siegel was wiped out because of anything which occurred in Las Vegas . . . a Chicago racketeer probably engineered the killing . . . Benjamin Siegel was killed because he demanded hush money from the Chicago mob . . . probably the Fischetti brothers, Charles, Rocco, and Joe.”
Not only was the planning of the murder unresolved, so too was the identity of the actual shooter. Recent interviews suggest that the contract for the hit, whatever its origin, was accepted by a California entity. John Carter (pseudonym), a Chicago investigator who prefers to remain anonymous, claims that he was told details of the shooting by Bobby Garcia, the skipper of Tony Cornero’s luxury gambling ship, The Rex. Cornero had partnered with Siegel in the Rex operation, and for years Siegel had refused to cut Jack Dragna, Johnny Rosselli, and the Outfit in on the action, even after Dragna had help set up Siegel when he’d arrived out West. “Bobby Garcia told me the contract went out to an Italian immigrant from San Diego who wanted to get staked in the olive-oil import business,” says Carter, who himself had personal relationships with Outfit members dating back to the 1930s. “The shooter had become an American citizen by joining the army during World War II. He used his army carbine to hit Bugsy.” Carter claims that he has forgotten the name of the shooter, who he said drove up to Beverly Hills from San Diego in a little pickup truck and waited in the bushes for Bugsy.
In the immediate aftermath of the Bugsy episode, the Chicago-New York Commission began investing in other Sin City casinos, such as the New Frontier (formerly the Last Frontier), then the Thunderbird (owned by Meyer Lansky), and the Desert Inn (Moe Dalitz of Cleveland). By 1952, with newly empowered local crime commissions placing gangsters in many major cities under the microscope, the hoodlum exodus to Nevada increased dramatically. The “Kefauver refugees” from around the country made the trek into the Nevada desert, anxious to shed their past like some desert reptile sheds its skin. Soon, more gang-controlled facilities such as the Sands (opened in 1952 by numerous Commission members, the Outfit, and Frank Sinatra) and the Sahara (Al Winter of Portland) opened for business. In some cases, the hotels were owned, or fronted, by an upperworld consortium, while the hoods managed the all-important casinos. “The hotels and the lounges were just window dressing,” said one Outfit member. “All that mattered were the casinos.”
During this period, Chicago’s interests, as coordinated by Curly Humphreys, were limited to minor investments in a number of the casinos. But with the Outfit pushing to go increasingly legit after Kefauver, Joe Accardo and associates decided it was time to own some Las Vegas properties outright. Accardo therefore packed his bags in early 1953, bent on checking out the desert opportunities for himself.
1. The entire episode recalls a story told by bandleader Tommy Dorsey to American Mercury magazine in 1951. For years the story had circulated that when Sinatra’s singing career had first taken off, he was desperate to escape a long-term contract with Dorsey. As the persistent rumor went, Sinatra went to Costello, who sent his goons to visit Dorsey. The thugs allegedly shoved the barrel of a gun in Dorsey’s mouth until he signed Frank’s release agreement. After years of such rumors, Dorsey himself admitted that he was in fact visited by three enforcers who instructed him to “sign or else.”
2. Most were desperate unemployed Depression victims. In the first three weeks after the project was announced, some twelve thousand employment hopefuls contacted the planners, willing to work in the 130-degree desert seven days a week for $1.15 per day. They would be allowed only two days off per year - Christmas and the Fourth of July.
3. Humphreys often visited St Louis, Kansas City, Los Angeles, and Dallas, where he helped expand the gang’s numbers racket; in Oklahoma, he was believed to have masterminded the flow of booze into that dry state; he made frequent trips to the nation’s capital to visit with the “mob’s congressman,” Roland Libonati.
4. The others were the Northern, the Rainbow, the Big Four, the Railroad Club, and the Exchange Club.