In the late 1930’s, Siegel was one of the major investors (15 percent) in the S.S. Rex, a luxurious gambling ship that floated just beyond the territorial waters off Santa Monica until Governor Earl Warren’s operatives finally seized it. In 1939, when Moses Annenberg abandoned his national monopoly on racing results, the Trans-National, the heirs of Al Capone set up their own news service, Trans-America, with Siegel in charge of bringing all West Coast bookies into the fold. By 1945, that alone was earning Siegel an estimated $25,000 a month. His overall income has been computed at $500,000 a year, roughly ten times the amount on which he paid taxes.
The only crime for which Siegel was actually prosecuted was the shooting in 1940 of Harry “Big Greenie” Greenbaum, a fugitive hoodlum who was suspected of trying to inform New York police about the activities of Louis “Lepke” Buchalter. Lepke sent Siegel two of his killers from the New York organization known as Murder Inc., and the three of them shot down Greenbaum outside a rooming house a few blocks off Hollywood Boulevard. Siegel was actually arrested and indicted for this murder, so he called in the celebrated Jerry Giesler to rescue him. It turned out, providentially, that the Brooklyn authorities were unwilling to permit any of their star witnesses against Lepke to travel to Los Angeles to testify against Siegel, so the indictment had to be dropped. Then, when the Brooklyn authorities mysteriously changed their minds, and Siegel was reindicted, the main witness suddenly fell out a New York hotel window while in police custody, and so the new indictment against Siegel had to be abandoned. It was perhaps only coincidental that the Los Angeles district attorney who finally cleared Siegel was the same John Dockweiler who was later to prove so righteous in the prosecution of Errol Flynn—and that this same Dockweiler had also received a thirty-thousand-dollar campaign contribution from Siegel. Dockweiler loudly declared that he had been unaware of Siegel’s donation, and when it became publicly known, he refunded the money to the newly liberated gangster.
The war years brought prosperity to the Los Angeles underworld, just as they did to the expanding city as a whole (Siegel, it later turned out, organized a firm known as the California Metals Company, which somehow accumulated six million dollars’ worth of “surplus” materials in a warehouse on Antonio Avenue), but it was the coming of peace that inspired entrepreneurs like Lansky and Siegel with grand visions of the future. Now, finally, there was lots of money around, and people wanted to play. Furthermore, traveling was going to be easy and popular. People wanted not only to play but to play in new places.
Las Vegas might have impressed any ordinary observer as an implausible El Dorado. Flat, hot, dry, it had nothing whatever to recommend it. Spanish explorers had somewhat charitably named it “The Meadows” and then moved on. Mormon settlers from Utah had made a brief effort to establish an outpost in the 1850’s but then relinquished it again to the Paiute Indians. The Union Pacific established a stop in 1905, though only as a way station on the line to the coast. Nevada state authorities did whatever they could think of to attract outsiders—legalized gambling, legalized prostitution, quick divorces—but most of the outsiders gravitated to the more established town of Reno, some three hundred miles to the north. Las Vegas, despite a temporary influx of money during the building of the nearby Boulder Dam, remained a ranch town of no more than ten thousand inhabitants. Its handful of modest gambling halls, several of them partly financed by Lansky and Siegel, occupied only about two downtown blocks, near Fremont and Second streets. “For Christ’s sake, Ben!” protested one of Siegel’s confederates, Morris Sidwertz, alias Little Moe Sedway, when he first saw the proposed site of the legendary Flamingo. “Seven miles out of town. Not a tree in sight, and nothing but bugs and coyotes and heat.”
But that was the whole point, the idea itself. “The choice of the desert was deliberate,” Lansky said. “Once you got tourists there, after they had eaten and drunk all they could, there was only one thing left—to go gambling.” On September 13, 1945, Sedway acquired from a Las Vegas widow a roadside tract of thirty acres surrounding the hulk of a bankrupt motel. Two months later, Sedway transferred this same property to Greg Bautzer, a dashing young Hollywood attorney who was also notable for having deflowered the seventeen-year-old Lana Turner (“I must confess that I didn’t enjoy it at all,” she said). Bautzer in turn transferred the property to an organization called the Nevada Projects Corp., in which the largest shareholder was Bugsy Siegel. Another substantial partner was Meyer Lansky. Siegel’s backers provided him with a total of one million dollars to build the Flamingo. He chose as the builder Del Webb, a Phoenix contractor who was later celebrated as the builder of Sun City, owner of the New York Yankees, and friend to J. Edgar Hoover.
It should have been fairly easy to build a casino for a million dollars, but Siegel was determined to build not just a casino but the greatest casino ever built. The illuminated pillar at its entrance would be visible for miles across the desert, a beacon to the new palace of pleasure, where everything was permitted. In 1946, however, the American economy was still entangled in wartime regulations and wartime shortages. Siegel had to maneuver, partly by paying black market prices, partly by using connections. He called on Nevada’s pliable Senator Pat McCarran, a conservative later celebrated for his investigations of alleged subversives, to help provide copper, steel, and other materials that were in short supply. He persuaded movie executives to delve into studio warehouses for lumber, piping, cement. He sent to Mexico and even Italy (what better use for Mafia connections?) to acquire fine marble and rare wood. He wanted a sunken tub in every bathroom, and a porcelain bidet. There were labor shortages too. Siegel flew in carpenters and plasterers, and he paid them as much as fifty dollars a day.
Things kept going wrong. The boiler room turned out to be too small, and the enlargement cost $115,000. Alterations in the kitchen cost $30,000. The novelty known as air conditioning broke down. The heavy curtains for the casino turned out to be highly flammable and had to be taken down and chemically treated. Siegel had ordered a special fourth-floor penthouse suite for himself, and he was dismayed to find his living room ceiling crossed by a steel beam only five feet eight inches from the floor. It cost him $22,500 to have it moved.
Siegel’s confederates were surprised and irritated by the dedication with which the mercurial Siegel built his palace, his insistence on supervising every detail, and on maintaining the highest quality, regardless of cost. Many of them attributed Siegel’s extravagance to his desire to impress the woman in his penthouse, Virginia Hill. She was a voluptuous creature, by now thirty, plump, red-haired, and she swore like a stevedore. She had been born Onie Hill, one of ten children of a drunken marble-cutter in Alabama, but the FBI ultimately listed twenty other names she used: Virginia Norma Hall, Virginia Herman, Virginia Oney d’Algy, Virginia Gonzalez . . . Gonzalez was actually the name of her second husband, a Mexican dancer, and after she cast him off in her mid-twenties, she gave up marrying. She bought expensive clothes and gave expensive parties and drank expensive whiskey. In Mexican casinos, she was sometimes known by the not very complimentary nickname of “The Flamingo,” and perhaps that, too, was an element in the naming of Siegel’s palace.
Virginia Hill carried and spent large sums of cash. A Chicago bookmaker named Joe Epstein, who knew her shortly after she left Alabama, periodically sent her mysterious packages of greenbacks for the rest of her life. Joey Adonis, the king of New York gambling, first took her to Hollywood, where she vaguely hoped to become an actress. Bugsy Siegel met her in a nightclub there, and, to the extent that he was capable of such things, he fell in love with her. Siegel’s wife, Esta, had quietly accepted all his previous philandering, but his obsession with Virginia Hill was so public that she gave him the traditional ultimatum. Siegel responded by promising her six hundred dollars a week for life, so she went to Reno for a divorce, and then back to New York. Siegel bought Virginia Hill a ruby-and-diamond ring and flew her to Mexico and married her in the fall of 1946.
By now the milli
on-dollar budget for the Flamingo was long forgotten; the costs were rising to two million, then higher, and still Siegel couldn’t get the job done. He had to borrow more money from Lansky and his friends, people who were not accustomed to waiting long for repayment. Siegel determined to stage the grand opening of the Flamingo casino on December 26, 1946, the day after Christmas, even though the hotel itself was not yet finished. There would be a gala floor show. Siegel signed up Jimmy Durante to star in it, and Georgie Jessel would be master of ceremonies. Billy Wilkerson, the publisher of The Hollywood Reporter, who also owned a share in the Flamingo, sent invitations to all the usual Hollywood celebrities.
In late afternoon of that opening night, when Siegel went to inspect the illuminated plastic waterfall at the entrance to the Flamingo, he found the waterfall dry, the lights unlit. A workman told him that a cat had crept into the structure the previous night and given birth to kittens; they would all have to be flushed out. Siegel forbade it. “It’s bad luck for a gambler to touch a cat,” he said. So the fountain was not turned on for opening night, but Siegel’s luck could hardly have been worse. There was a sudden storm in Los Angeles, and the Constellations that Siegel had chartered to ferry movie stars to his opening could not take off. Nobody seemed to want to come to the great event anyway. Jessel and Durante arrived to do their routines, of course, along with Xavier Cugat and his band. George Raft made the trip in his Cadillac, but the only other guests who could be considered Hollywood celebrities provided a distinctly unimpressive gathering: George Sanders, Charles Coburn, Sonny Tufts. There can rarely have been a more cheerless scene than the newly opened casino at the half-empty and half-finished Flamingo, standing alone in the Nevada desert on the night after Christmas.
Even the gambling tables lost money. Siegel couldn’t figure out whether his employees were cheating, or whether local gamblers were more skillful than he thought, or whether it was simply a matter of bad luck, but the Flamingo lost $300,000 on gambling alone during its first two weeks of operation. And by now, Siegel’s building costs were stupefying. The furnishing of the ninety-two rooms was running to $3,500 each. Overall, the cost of the Flamingo had climbed from the original one million to more than four million dollars. Siegel made a drastic decision: He closed down the whole place until he could get it finished. Virginia Hill, tired of the venture—tired particularly of Siegel’s outbursts of bad temper—returned to Beverly Hills. There she rented a mansion on North Linden Drive and began giving parties.
On March 1, 1947, Siegel finally got the furniture installed and the hotel open, but though the spotlights now shone invitingly across the desert, the Flamingo still failed to bring in the fortunes that Siegel had so long expected. The operating loss for the first six months was $774,000, the total cost, six million dollars. Siegel scrambled to raise new funds wherever he could find them, but the gangsters who had originally sponsored the Flamingo were becoming convinced that the disaster was largely Siegel’s own fault. Not only did they blame him for mishandling the project, but there were rumors that the losses might not be as great as Siegel said, that Siegel might be hiding some of the money for himself.
In December of 1946, even before the original opening of the Flamingo, there was a remarkable meeting at the Hotel Nacional in Havana. The host was Meyer Lansky, and the guest of honor was Lucky Luciano, Lansky’s boyhood friend, whose deportation from New York to Italy had lasted just nine months before he returned to Cuba to look after his interests. Lansky, the original organizer of the Nacional’s casino back in 1937, invited Luciano to stay there, and he was pleased to see that the hotel’s Christmas attraction would be Frank Sinatra. He invited all the barons to Havana to welcome the return of Luciano—Frank Costello and Joe Adonis from New York, as well as Vito Genovese and Joe Bonnano; Carlos Marcello from New Orleans, Santos Trafficante from Florida; the whole lot.
It was inevitable that the chieftains assembled at the Hotel Nacional should consider Bugsy Siegel’s venture in Las Vegas. Just as inevitably, they were appalled to hear the reports that the Flamingo was costing millions more than planned, that some of their money was being spent at the whim of Virginia Hill, and that some of it might be going to Switzerland. “This sort of behavior meant only one thing in the underworld,” said one of Lansky’s closest associates, Joseph “Doc” Stacher, in an interview shortly before his death in Israel. “Bugsy was going to be hit. Meyer knew that too, but he did all he could to save his friend. He begged the men to be patient. . . . It was the first time I ever heard Meyer become so emotional. . . . He pleaded with everybody there to remember the great services that Bugsy had performed for all of them. They looked at him stony-faced, without saying a word.” According to Stacher, Luciano himself later accosted Lansky and said Siegel would have to be punished. “If you don’t have the heart to do it, Meyer, I will have to order the execution myself.”
Bugsy Siegel had all kinds of troubles. Virginia Hill came back to spend a weekend in the Flamingo penthouse, and Siegel picked a quarrel with her because he found her reading a copy of Time, “that crummy magazine.” He knocked the magazine out of her hands and then gave her a shove. She hit him over the forehead with her spike-heeled shoe, then hit him several more times and ran out. But after all of Siegel’s work and worry, the Flamingo finally seemed to be making money. May was profitable; June would be better. Siegel apologized to Virginia and invited her to take a trip to Paris.
In mid-June, Meyer Lansky himself arrived at the Flamingo to spend a few days. He was not there to gamble; he apparently never left his room. There were some meetings. Nobody really knows what happened. According to Doc Stacher’s version, which is presumably Lansky’s own version, Lansky did his best to defend Siegel to the end. Other speculations suggest that Lansky himself decided Siegel must be punished, that his last trip to Las Vegas was his version of the kiss of death.
Siegel seemed to have no premonitions about what would happen. He spent his last few days on various secret meetings and negotiations, but he showed no particular sign of anxiety. He flew to Los Angeles just after midnight on June 20 and let himself into Virginia Hill’s house with a golden key that she had given him. She herself had gone to Paris, but her brother Chick was staying in the house.
The following evening, Siegel drove to a seafood restaurant named Jack’s, in Ocean Park, together with Chick Hill, Chick’s girlfriend, Jerri Mason, and a business associate named Allen Smiley. As they emerged from the restaurant shortly after 9 P.M., somebody handed Siegel a copy of the next morning’s Los Angeles Times, which bore a stamp on the front page that said, “Good night. Sleep well. With the compliments of Jack’s.” When they got back to the house on Linden Drive, Siegel suddenly sniffed the air suspiciously.
“There’s a strong smell of flowers in here,” he said to Chick.
“I don’t smell anything,” Chick said. “There isn’t a flower in the house.”
“Can’t you smell them, Jerri?” Siegel persisted.
“No, I can’t,” she said.
Siegel shooed Chick and Jerri upstairs so that he could talk business with Smiley. Chick later remembered telling Jerri that his grandmother, Virginia’s grandmother, had once told him that “when someone smells flowers and there aren’t any in the house, it means they’re going to die.” Jerri told him, as they retired to the bedroom, that his grandmother’s tale was just silly superstition.
Downstairs, where Siegel sat on the sofa with the newspaper open across his lap, he and Smiley were clearly visible through the undrawn curtains on the living room window. Outside in the darkness, a man armed with a .30/30 carbine slowly took aim through some garden latticework. He fired, then fired again, nine times in all. The first bullet through the window smashed Siegel squarely in the face, knocking out his right eye and sending it flying some fifteen feet away onto the tiled floor of the dining room. As Siegel’s head sank back against the sofa, the second bullet hit him in the neck. Another bullet tore through Smiley’s sleeve as he dove to the floor. An
other shattered a small marble figure of Bacchus that stood on Virginia Hill’s piano. Another embedded itself in a painting of a nude holding a wineglass.
One of the first reporters to reach the scene was Florabel Muir of the New York Daily News, who noted that the living room was filled with the smell of the night-blooming jasmine that grew just outside the window. She lifted the blood-spattered newspaper on Siegel’s lap to see what he might have been reading. She also checked the flight of Siegel’s eye. “From the jamb of the wide doorway . . .” she recalled, “I picked up the sliver of flesh from which his long eyelashes extended.”
Within twenty minutes of the killing, while the police were still arriving at the house in Beverly Hills, and long before any official news reached Las Vegas, three men marched into the lobby of the Flamingo. There were fierce sandstorms tearing through the sky that night, and the casino was half empty. One of the three newcomers was Little Moe Sedway, who had originally bought this property for Siegel but later quarreled with him; the second was Gus Greenbaum, the head of gambling operations in Tucson; the third was Morris Rosen, an ex-burglar from New York who now worked for Lansky. They announced to the casino staff that there had been a change in management. They were taking over. And so it was. Nobody disputed them. And during the first year in which Gus Greenbaum managed the Flamingo, it showed a profit of four million dollars.
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