Bugsy Siegel

by Michael Shnayerson

  Vegas had a scattering of small, western-style casinos in early 1941 that catered to the locals. Later, Siegel would be credited as the first to envision the glamour palaces to come. In truth, a hotel owner from Sacramento named Tommy Hull had the jump on him. “He had a flat tire one time he came up here,” recalled Cahlan, “and he just counted the automobiles passing by.”2 Enough, Hull sensed, for a larger casino than Las Vegas had yet seen, midway between Salt Lake City and L.A., not just with gaming tables and slot machines but with rooms for the night: a hotel-casino.

  When Hull’s El Rancho Vegas opened in April of that year, the first hotel-casino on lonely Highway 91, it was an overnight success, thanks to its 110 guest rooms. Guests could drink and gamble late into the night, then just toddle upstairs to bed. That November came a downtown competitor, the even grander El Cortez. It had colorfully lit landscaping, replete with a man-made waterfall.

  The Flamingo was five years away, not yet a gleam in Ben Siegel’s eye. Still, he understood the money to be made in Vegas from the new hotel-casinos. Nevada was still the only state to permit gambling, a deeply comforting thought. And now, along with more gaming tables and slot machines, where gamblers could bet all night, the new El Cortez and El Rancho Vegas could take the race wire. Bettors could bet by wire all day on horse races around the country. All Siegel had to do was take control of the race wire in Vegas, and not let his rivals get there first.

  For Siegel, this was the very embodiment of a new, soul-restoring chance. Siegel knew he had botched his chance for legitimacy in southern California. The Hollywood stars who had come to the mansion on Delfern to socialize with its ­dapper owner came no more, not even to gamble. With Big Greenie’s murder and the publicity that followed, Siegel had become persona non grata in Hollywood, accepted only by George Raft and Dorothy di Frasso. When his murder case was dismissed a second and final time, Siegel put his hopes and outsize ambition on the dust-blown, boom-and-bust town of Las Vegas.3

  Long before gamblers came to try their luck at the slot machines and roulette wheels, Las Vegas had drawn its share of risk-takers. Despite the surrounding desert, pioneers had begun making it a stop on the Old Santa Fe Trail in the 1830s, and frontier explorer John Frémont had led a settlement party there in 1844. They, and the Mormons who followed, were all drawn by the astonishing meadows—a great oasis—that gave Las Vegas its name.

  Las Vegas was farmland, alfalfa its chief crop, sheep its main livestock. “They would bring in sheepherders from the Pyrenees,” a doctor’s wife of the period explained. “Those sheepherders would stay out months on end.” The doctor always took his compass on house calls. “Otherwise he would get lost and wander for hours,” his wife said, “and we would have to send a search party.”4

  In 1905, all that changed with the arrival of a railroad baron and U.S. senator from Montana, William Andrews Clark, who declared his intention to build a train line from Los Angeles to Salt Lake City. Las Vegas was halfway: perfect for a stopover. Clark’s engineers could sink artesian wells and supply water to their trains, and his work crews could build a trackside depot for on-the-spot repairs. Clark, all business, dispensed with the name Las Vegas. He called his outpost Watering Hole #25.5

  Along with the railroad workers, or “rails,” as they were called, Watering Hole #25 soon had passengers alighting for the creature comforts they knew to expect from a frontier town: booze, gambling, and prostitution. Officially, gambling was outlawed in Nevada in 1909. In truth, games of chance hummed right along. The town fathers made a half-hearted effort to limit prostitution to block 16, down by the railroad tracks, only to see brothels appear in the back rooms of nearly every saloon in town. In such revels was the city’s soul born.6

  Clark built this hardscrabble town. And then, in 1922, he tried to destroy it, after his railroad workers joined a nationwide strike. Ruthlessly, Clark shut down the railroad repair shop and took away three hundred jobs. Grim years ensued, until President Calvin Coolidge brought Las Vegas roaring back to life in 1928 by authorizing the massive Boulder Dam, later to be named the Hoover Dam, on the nearby Colorado River. Hundreds of laborers converged on government-built Boulder City, with keen appetites for after-work vice.

  Alcohol remained illegal though obtainable, until Prohibition’s end in 1933. In the watershed year of 1931, however, the sparsely populated state of Nevada, fearful the dam would fall short of counteracting the Great Depression, sanctioned almost everything else. Card games, roulette wheels, and slot machines became legal. So did prostitution and quickie marriages: no waiting period, no health certificates needed, with county clerk offices open twenty-four hours a day to rake in the marriage fees. On the same day as the gambling bill passed, so came quickie divorces. Either party, not both, now needed only to stay in the state six weeks to establish residency and get a divorce. No other state could match Nevada for such ease of marital disengagement.

  With the dam’s completion in 1935, fears of joblessness grew. They proved groundless. Las Vegas was on the map now. It drew travelers wanting to see Boulder Dam, the nearby national parks, and the casinos of Las Vegas, now primed with legal booze. By the late 1930s, national magazines were extolling Vegas as the great new American destination, and hinting at the naughtiness visitors might find there.

  Siegel’s first stake in a Vegas casino was probably the check he wrote for $18,000 to the owner of the Northern Club, one of those wagon wheel–and–sawdust joints the locals favored. The canceled check was among those found in his security vault during the raid of his home on Delfern Drive on August 16, 1940.7

  Buying into the Northern Club made a lot of sense for Siegel. He could learn the business as a partner, scanning the Northern Club’s books. He could take a slice of the profits from its roulette wheels, slot machines, and twenty-one gaming tables. Most enticing, he could bring up the race wire from Moe Annenberg’s fallen empire in southern California, pushing the casinos to pay a handsome subscription fee that would go, in part, into Ben Siegel’s pocket.

  The course seemed clear, with new fortunes to be made. For Siegel, the news of December 7, 1941, raised hopes for that much more. Siegel felt the same excitement with Pearl Harbor that Prohibition had stirred: the sense of a world-changing opportunity for those quick enough to capitalize on it. America’s entry into World War II brought Vegas a vast new military airport. It brought the new Army Air Corps Gunnery School, where thousands of fighter pilots and bomber crewmen trained to handle machine guns mounted on B-class warplanes. It brought Basic Magnesium, where thirteen thousand workers mass-produced locally mined magnesium, the “wonder metal” used in airplane construction. Those pilots and workers wanted extracurricular pleasures, and who better than Siegel to provide them?

  At one time or another, Siegel had shares in nearly every Vegas casino of the early forties, from the Pair-O-Dice and the Northern Club to the Frontier Club, the Last Frontier Hotel, the Las Vegas Club, and the El Cortez, all serving the wartime boom. Still, he hungered for more. He wanted a race wire of his own, one like Annenberg’s with national reach. He wanted his own hotel-casino, too.

  Siegel had hoped to seize the whole West Coast wire, but Annenberg refused to sell it to him. Instead, the ailing race wire pioneer basically gave it to one of his old pals from the Hearst newspaper wars. It was a brief tenure. Mickey McBride renamed Annenberg’s wire the Continental Press, as if gangsterdom might fail to notice its latest disposition. In almost no time at all, McBride passed it on to another old crony from the newspaper wars, James Ragen Sr. McBride never said as much, but his haste in selling was probably the result of threats from Chicago mobsters with race wire ambitions of their own. They could run a national wire as easily from Chicago as from anywhere else: all they needed was telegraph wires and betting rooms in every market.8 Ragen, a very tough guy, declared he would be staying put in Chicago and running Continental himself. He had an ally in Meyer Lansky, who, with Annenberg, had run the wire through Florida’s Gold Coast of casinos and clubs.<
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  Siegel couldn’t take Ragen on yet. At Lansky’s direction, he had to work with him, along with Jack Dragna, who still ruled much of southern California, and Johnny Roselli, until recently Moe Annenberg’s West Coast agent. The mobsters became a team, if a reluctant one, since each would have much preferred killing the others. Together, they represented Continental on the West Coast, working out of a downtown office run by James Ragen’s son-in-law, Russell Brophy.

  Siegel soon lost patience with this setup. He started his own wire, Phoenix-based Trans-American, and began taking over Continental’s bookie parlors in Arizona, with L.A. in his sights. To his astonishment, he found himself blindsided by the notorious Mickey Cohen.9

  Cohen was a hit man and all-purpose thug known back east for his “fearsome, simian manner,” as Bugsy biographer Dean Jennings put it, “and the knife cuts and bullet scars that crisscrossed his stomach, along with the gold mezuzah on a light chain around his waist.”10

  Cohen had just moved to L.A. to escape a little heat from the authorities back east. He found it irksome that Continental Press was operating without his blessing and participation. To make his sentiments clear, he paid a visit to one of Continental’s offices, accompanied by a favorite henchman, Joe Sica. By great good chance, a bagman called Little Joe walked in at that moment to check on a race result. Cohen easily guessed the meaning of Little Joe’s terrified look: Little Joe was en route to another race wire office with the day’s haul for Siegel and Dragna. As one of the office guards reached for his gun, Cohen warned him to back off if he wanted to live out the day. The guard backed off, and Cohen pointed his gun at Little Joe. “I ain’t got nuthin’,” Little Joe said. “I just come here to lay a bet.” Cohen took aim. “You want it in the head, quick, or slow in the belly?” Little Joe handed over a satchel of what proved to be $22,000.11

  When news of the heist reached Siegel, he had to laugh. It was so audacious. He proposed that Cohen meet him at a YMCA where Siegel liked to work out. Another gangster might have feared for his life, but not Cohen. After a little small talk, Siegel offered him some advice. “He says to me ‘you’re a gutty kid, but you need some finesse and polish, or you’re going to wind up being on the heavy . . . the rest of your life,’ ” Cohen told a biographer years later. “ ‘You got ability that if used in the proper way would put you in a different scale.’ ”12 Cohen was flattered, but still refused to give the Continental mobsters their money back. A second meeting in a lawyer’s office proved no more fruitful; Siegel was beginning to lose face.

  Finally, Siegel proposed that Cohen and his sidekick Joe Sica pay a visit to Continental’s biggest L.A. office. Siegel and his partners might still be in business with Continental, but they had their own agenda. Ultimately they wanted either to take Continental for themselves or push Siegel’s new Trans-American wire into dominating the field. Perhaps in paying this social visit, Cohen could earn back the money he’d filched.13

  On July 21, 1942, Cohen and Sica strolled into Continental’s downtown L.A. office and pulled out all the telegraph and telephone wires from the walls. Aware of the sudden silence, Russell Brophy emerged from the back office. He told the thugs to clear out. Cohen responded by striking him with a pistol butt. Together, he and Sica beat Brophy until the man lost consciousness.14

  Siegel took Brophy’s hospitalization as an opportunity to sweep through L.A. with Mickey Cohen, urging bookies to switch their allegiance to the new Trans-American wire. The two wires were basically identical: both sent out race results and information by telegraph. Continental bookies would just pay their subscription fees to Siegel and his gang, rather than to Brophy, Continental’s battered man in southern California. There was an added incentive that went unspoken. Bookies who signed up with Siegel’s new “association,” as he called it, would not be subject to pistol-whippings, as they would if they stayed loyal to Continental. “There is no existing record that shows how many cracked skulls, or how many unsolved murders, were a direct result of Siegel’s western war on Continental,” wrote Jennings. “But that one incident alone—told to me with a twisted sort of pride by Mickey Cohen—is a clue to Siegel’s eventual success.”15

  By one estimate, Siegel and his pals persuaded some five hundred Continental bookies in the Los Angeles area to switch teams, out of a total of some eighteen hundred. That was a lot of persuading.16

  As a next step to expanding his empire, Siegel sent his genial number-two man, Moe Sedway, to negotiate with Continental for rights to its Las Vegas wire. Moses Moe Annenberg had been freed from prison to die at home of a brain tumor in July 1942. The next month, Sedway sealed the deal for Las Vegas rights. Siegel would pay Continental a weekly fee of $900 and keep all the race wire profits he made in Las Vegas. Perhaps not coincidentally, that was the month Ragen’s son-in-law Brophy was beaten to a bloody pulp.17

  As more casinos signed on, Siegel’s deal with Continental showed real foresight. According to one report, Siegel began pocketing $25,000 a month from his Vegas race book, the equivalent of nearly $400,000 a month in today’s U.S. dollars. With his management shares of various casinos, and his highly informed daily betting at the track, Siegel was said to push his overall yearly income to $500,000, or about $7 million in today’s dollars.18

  One Vegas casino owner who needed no prompting to take Siegel’s race wire was the Octopus: Guy McAfee, Siegel’s old L.A. nightclub rival. Run out of southern California in 1939 by a new reform-minded L.A. mayor, McAfee had decided the time had come to try his luck in Vegas. To his chagrin, the tumbleweed town had proved a challenge.19 His Frontier Club was struggling, its nighttime business ho-hum. McAfee, it seemed, had overbuilt. Desperate to increase traffic, he suggested a sweetheart deal to Siegel. He would not only pay $300 a week to subscribe to Siegel’s race wire but give him a slice of the nightly take. Anything to get customers in.

  Siegel must have granted those tough terms with glee, after years of vying with the former gambling king of L.A. But both men profited. The Frontier’s race wire drew a whole new daytime market of off-track horse bettors, and McAfee saw his business soar. Having tried and failed to sell the Frontier for $40,000 in 1941, he would turn down a $400,000 offer just three years later.20 Of course, the Frontier’s success did not go unnoticed. Siegel became a two-thirds owner of the place. The more a Vegas casino made on its race wire, it seemed, the bigger a slice of its overall profits Siegel was apt to take.

  By February 1943, Siegel was said to run his race wire through most of the town’s casinos. But that wasn’t all. His territory extended to the rest of Nevada, Arizona, and southern California.

  Siegel loved the money to be made in Vegas. He just hated Vegas itself: the tedious drive, the cowboy culture, and the desert around it. Los Angeles was his home. Beneath its perfect, unpolluted skies, he went to the track every day, had his barbering needs tended to, and visited the L.A. clubs and gambling dens from which he cheerfully extracted his take. Meanwhile, he and Wendy Barrie had gone so far as to get engaged. That the romance fizzled was perhaps due to Siegel’s insistence on living with his family at home. George Raft’s earlier warnings proved groundless: Barrie went on to a long career, her reputation unblemished by Siegel.

  Despite his intent to sell the house on Delfern, Siegel still enjoyed his time there. He was in fact living a double life, often with Barrie but a family man whenever he came home. He appreciated Esther’s devotion to their daughters and admired her traditional values. He knew she would never take a lover, no matter how hurtful his dalliances might be. In exchange, Siegel faithfully served as family provider, in the lavish manner his money allowed.

  On one occasion, Meyer Lansky brought his wife and daughter Sandra out to stay with the Siegels. At perhaps six years old, Sandra Lansky marveled at the mansion and its expansive grounds. But she awoke the next morning to a sight that made her cry out in alarm. Her Aunt Esther seemed to have become a witch. In fact, Ben’s wife was wearing a black sleeping mask to block the sunlight. “So I scr
eamed and ran into Uncle Benny’s bedroom, and what I saw there was even worse,” Sandra writes in her memoir. “Not only was he, too, in a black eye mask, but he had this crazy black elastic vise around his cheeks and chin. It turned out to be some device Hollywood stars wore to bed to prevent wrinkles.”21

  Sandra’s scary moment suggested a development no six-year-old would have appreciated. Ben and Esther appeared to have resigned themselves to separate bedrooms. How long their marriage had persisted in this arid state was a secret between the grown-ups, but with Wendy Barrie’s relatively long-term presence in his life, Ben seemed unlikely to find any pleasure in his marital bed. As for Esther, she had married Ben at seventeen and would say, after his death, that he was the only man she had ever loved. Her consignment to a separate bedroom was probably one she rued with bafflement and chagrin.

  Siegel still dressed and acted like a gangster. But he prided himself on his clean police record, so far as it stretched to the state’s borders. True, he had spent the autumn of 1940 in an L.A. county jail, and faced a two-part murder trial, but both parts had ended in dismissals. That, he felt sure, was what ­motivated the L.A. sheriff’s vice squad to stage a raid on Siegel for gambling in a room at the Sunset Towers hotel on May 25, 1944.22

  Siegel was spending that morning with his old buddy George Raft. There with them was Allen Smiley, Siegel’s Kiev-born right-hand man, in whose apartment the three men were socializing. Smiley was movie-star handsome, with prematurely gray hair and a Hollywood story to boot. Sentenced for robbery in his youth to a California reformatory, he had seized a bizarre chance: film director Cecil B. DeMille toured the reformatory in researching a movie, and Smiley managed to meet him. Upon his release, Smiley asked DeMille for a job and was given one in the wardrobe department. Soon he was pitching story ideas to stars and socializing with the likes of George Raft and Ben Siegel, who admired Smiley’s pluck: in a fight at band­leader Tommy Dorsey’s apartment, he was said to have sliced off part of actor John Hall’s nose.23