Often, we associate the world of the casino with that of organized crime, the mafia to be more precise. The casino and the mafia have a long and turbulent history of complicity. Whether raising capital, organizing fixed games or lending money to players, criminal organizations have used gambling establishments for their business. Indeed, it was the perfect cover to make easy profits, but also to launder money.
Let’s look back on the very close relationship between the casino and the mafia. Organized crime has allowed the city of Nevada to become what it is today. On the other hand, Las Vegas allowed the mafia to write a big page in their history.
Bugsy Siegel and the First Casino in Las Vegas
At the start of the 20th century, Las Vegas was still far from being the entertainment capital of the world. Indeed, it was the city of the railroad between Salt Lake City and Los Angeles, considered a gateway between the East Coast and the West Coast. Gambling begins to appear, but is very quickly banned.
The city would gradually grow, so the state of Nevada decided to do an about-face and legalize gambling in 1931. This would not only end a 21-year ban, but also see the first casinos. And at the same time, attract the mafia milieu to Sin City, embodied by Bugsy Siegel.
During the 1940s, the man who was already a clutch of the Jewish mafia became interested in Las Vegas. He and his partners acquired the El Cortez hotel-casino for $600,000, but it didn’t go as planned. Indeed, his expansion plans have been hampered by unfriendly city officials who are mostly aware of his criminal past.
With this in mind, Siegel began looking for a site outside the city limits. He then learned that William R. Wilkerson was seeking additional funds for his casino project, the Flamingo. Thus, Bugsy Siegel and his partners posed as businessmen and directly bought shares in the project.
Once settled into the project, Siegel took charge of the final phases of construction and convinced other of his underworld associates, such as Meyer Lansky, to invest in it. But faced with rising costs, Siegel reportedly lost his patience, and he once mentioned to his builder, Del Webb, that he had personally killed 16 men. Atmosphere on the construction site…
Siegel eventually opened the Flamingo Hotel & Casino on December 26, 1946, at a total cost of six million dollars, five more than originally planned. Dubbed The West’s Greatest Resort Hotel, the 105-room property and the Strip’s first luxury hotel was built four miles from downtown Las Vegas. During construction, a large sign announced that the hotel was a William R. Wilkerson project. The sign also listed Del Webb Construction as the hotel’s main contractor and Richard R. Stadelman as the building’s architect, no mention of Bugsy Siegel’s name being made.
A Short-Lived Success for Bugsy Siegel
If the casino was a success, Bugsy Siegel would not have been able to enjoy the fruits of his success. He lost a fortune on the project and neither did his bosses, who placed a contract on his head, which inevitably led to his assassination in 1947, in Beverly Hills.
But the success of the Flamingo soon attracted other gangs to the new city of gambling. And power gradually shifted from New York mob families, who first settled in Vegas, to gangs from the Midwest (mainly Chicago). From there, the Mafia’s role in the development of Las Vegas in the 1950s and 1960s was to be paramount.
The Casino- the Perfect Cover to Launder Money
At that time, among the casinos in which the mafia was involved, there were, in addition to the Flamingo, other gambling establishments, such as the Aladdin, the Circus Circus, the Desert Inn, the Dunes, the Riviera, the Sands and the Tropicana. And by the late 1970s, virtually every casino in Las Vegas was linked in one way or another to the Mafia.
The involvement of organized crime in the gambling business was beneficial to the families. In addition to possible profits, casinos were also the perfect place to launder the money generated by their other illegal activities. The ties between the mob, labor unions and construction companies have allowed mobsters to profit from all aspects of the casino industry in Vegas.
It was around this time that the police decided to take matters into their own hands.
A Period Now Over, But that Is Well Remembered
To track them down, the FBI and local police work together, taking advantage of the departure of a corrupt police chief. A microphone is then installed in the casino. Authorities learned from an informant that a jewelry store robbery had been organized on July 4, 1981, by a group of burglars called The Hole in the Wall Gang, led by mobster Anthony Spilotro. The members testify against the gang in exchange for protection, and an investigation is launched to prove that the money is diverted from the casino to Chicago.
This decade is marked by arrests, deaths and conversions of former mafiosos. But this period of Las Vegas history was also entitled to a kind of tribute! Located in the old city courthouse and two blocks from famous Fremont Street, the Mob Museum traces the history of organized crime in the United States since 1990.
Former mafia lawyer Oscar Goodman, who notably defended Anthony Spilotro, became mayor of Las Vegas in 1999. A position he held for more than a decade, until 2011. He will be succeeded by his own wife, who still holds the position today! Goodman even played himself in Martin Scorsese’s movie Casino.
The 1990s ushered in a new era for the city of sin. On the Strip, casinos with a dubious past have been demolished, to be replaced by newer and more luxurious casino hotels.
