Pinchuk and the International Crisis Group - Mafia Buying Respectability
Stefan Lemieszewski
=========================================
It's been pointed out that in Ukraine, the mafia oligarch,
Viktor Pinchuk is a board member of the International Crisis
Group.
It's not that unusual that gangsters, oligarchs, white-collar
criminals, et. al. try to buy respectablility through philanthropies,
charitable organizations, hospitals, medical research institutions,
university boards, think tanks, etc. Usually it only takes some
dollar contributions, either overtly or covertly, or the right
connections.
Consider the well-known Center for Strategic and International
Studies (CSIS) [where former members of the American Ukrainian
Advisory Committee such as Zbigniew Brzezinski and Henry
Kissinger are members and counsellors]. CSIS's Advisory Board
had one member named Steve Wynn (his mafia-linked father
changed the family name from Weinberg).
Wynn is known as the "casino king" of Las Vegas. He controlled
casinos such as the Bellagio, Treasure Island, Dunes, Golden
Nugget, Mirage, etc. He recently imploded the Dunes so that he
could build his new Wynn Casino on the same property. Wynn is
a frontman for the Genovese crime familia of New York according
to a report by New Scotland Yard's Criminal Investigation Dept. For
many years the Genovese boss was the cigar-chomping Anthony
"Fat Tony" Salerno (whose net worth was estimated at some
$200 million when he was sentenced to 100 years in prison).
Salerno was known for fixing theTeamsters Union elections which
brought Jackie Presser and Roy Williams as presidents. In the
1960s, the Teamsters' Pension Fund was looted by the mafia
through the mob front and lawyer Allen Glick into providing tens of
millions of dollars for building the mob casinos in Vegas, such as
Caesar's Palace. (Caesars sold two weeks ago for $9.3 billion
which is almost equivalent to 25 percent of Ukraine's GNP).
In the 1990s, Mogilevich and the Solntsevo crime familia were
in cahoots with the Genovese crime familia in various rackets
such "pump and dump" stock scams on Wall Street. The Cosa
Nostra also rigged cement contracts for building projects such
as the Trump Tower. Though Britain turned down Wynn's casino
application because of his Genovese mob ties going back to the
1960s, Wynn doesn't seem to have a problem in the USA.
Before selling the Mirage, Wynn controlled the Shadow Creek
Golf Course (cost $48 million to build) with such an exclusive
membership that it only had one member -- Steve Wynn's.
Thus, one could only play there at Wynn's invitation. Guests
have included Kevin Kostner, Michael Jordan, Larry Bird, etc.
Players had to have a $100,000 line of credit at the Mirage
before they could paly. Wynn had lockers numbered 1 & 2.
The locker next to Wynn's belonged to a Japanese yakuza
mafia mobster named Ken Mizuno, who lost only $75 million
in only two years of gambling at the Mirage. Mizuno was
convicted in Japan for money laundering and sentenced to
11 years in jail after ripping off Japanese investors in his own
golf course for $600 million. (He sold 52,000 memberships in
a Tokyo golf course at up to $54,000 each totaling $853 million
while promising that no more than 2,800 memberships would
be sold. Mizuno also tried opening a Japanese restaurant and
health spa at the Tropicana Casino in Las Vegas but was
denied a license because of his yakuza mafia ties. Wynn also
held a breakfast fundraiser at Shadow Creek on behalf of the
Republican National Committee (at which the Golden Nugget
casino contributed $230,000). The golf course has also had
players such as Hollywood producer (eg The Karate Kid)
Jerry Weintraub, a quiet force in the Republican Party and
a close friend of the former president George Bush. Bush
has been spotted playing golf at Shadow Creek (but a Bush
spokesman denies it). In addition to CSIS, Steve Wynn
serves as a member of the Board of Trustees of the University
of Pennsylvania and sits on the Board of the George Bush
Presidential Library. In 1995, Wynn played guest at Shadow
Creek to presidential hopeful Bob Dole. (Wynn, Dole, Bush
and Reagan all shared the same services of imagemaker
Sig Rogich). Wynn is registered as a Democrat, but that
doesn't prevent him from making contributions to Republicans.
Wynn's casino purchases such as the Golden Nugget were
financed by his friend Michael Milken, the "junk bond king" in
the 1980s. After a short stint in prison, Milken, the billionaire
criminal and now philanthropist, sponsors Steve Wynn as a
guest speaker. For example, in 2003, Milken in conjunction
with Forbes Magazine, sponsored Wynn as a guest speaker
at the Milken Institute Global Conference for "creating value,
opportunity and economic growth".
At Wynn's Golden Nugget casino in Atlantic City, he hired
"Fat Tony" Salerno's friends as employees. Other mob capos
were flown to the Golden Nugget aboard the casino's Sikorsky
helicopter as guests of Charlie Meyerson, a former bookie
linked to the Genoveses and the casino's chief junket rep,
who was paid more than the president of the Golden Nugget.
In November 1982, one of Charlie Meyerson's guests whom
he personally escorted to the Golden Nugget was Anthony
Castelbuono, a Harvard Law School-educated attorney and
heroin-trafficking money launderer for the Cosa Nostra. "Tony
Cakes" Castelbuono laundered over a million dollars cash at
the Golden Nugget during that trip -- cash which he brought
with him in suitcases. The junkie money was comprised of fives,
tens and twenties originating from the heroin addicts on the
streets of New York City. It took the casino five hours to count
the cash. For his troubles, the casino provided "Tony Cakes"
with such comps as the President's Penthouse Suite. "Tony
Cakes" would normally money launder the mob's drug money
through an anonymous bank account at Switzerland's Credit
Suisse bank. The drug smuggling network could move 80 kilos
of heroin from Italy to New York City about every two weeks.
But the street value of 80 kilos was about $130 million. And the
sheer volume of piddly denominations in fives and tens was
a problem. Castelbuono's stack of cash was estimated at a
volume of 5.81 cubic feet, or a stack nearly 6 ft high, 6 ft wide
and 6 ft deep. A bit too big to squeeze in the overhead bin on
a commercial plane to Switzerland. Despite such Castelbuono
examples (and problems with Currency Transaction Reports
that casinos are obligated by law to provide for every single
cash transaction greater than $10,000), the New Jersey
Casino Control Commission relicensed Wynn's Golden
Nugget.
And usually stories such as the nude party girl who was
almost cut in half by a propeller from the 45 ft casino yacht
on Lake Mead don't make the cocktail gossip at CSIS socials.
On board were such notables as Steve Wynn and a Meyer
Lansky bagman and money launderer named Irving "Niggy"
Devine. In the upperworld Devine was part owner of the Silver
Slipper and Fremont casinos and companies which sold
meat to Vegas casinos. In the underworld, Devine reportedly
delivered the skim from casinos to Lansky and other mob
bosses as well as launder the money through the Bank of
World Commerce of Nassau. (Better to focus Steve Wynn's
philanthropy such as providing free school trips to needy
children on visits to his dolphin exhibit at the Mirage.)
Steve Wynn's other acts of kindness include sharing his
personal art collection. He received lots of publicity for providing
his art to the Bellagio casino where it was on display and
available to the public. Less known was that Wynn charged
the Bellagio $5 million per year in fees. Wynn paid no tax as
it was deemed a public "educational benefit" to the people of
Nevada according to laws passed by the Nevada Legislature,
considered by some as a wholly-owned subsidiary of the
gambling industry. But it became an issue again when it was
realized that visitors were charged a stiff admission to see
the collection for their "educational benefit". So Wynn offered
a discount to Nevada residents and continued to receive his
tax exemption.
[BTW, Sheldon G. Edelman's Venetian casino has a small
art collection through the joint effort of the Guggenheim of
New York and The Hermitage of St Petersburg].
The late Robert I. Friedman wrote Russian Mafiya and could
not be silenced by death threats coming from Ivankov/Mogilevich.
Friedman also researched an investigative article about Steve
Wynn that was to be published in the GQ magazine. However,
Wynn and his lawyers exerted sufficient pressure to kill the
story before it went to press. Seems that freedom of the press
does have limits, especially when it comes to some wealthy
philanthropists.
And with Meyer Lansky mob-lawyer Oscar Goodman as mayor
of Las Vegas, no doubt the gaming prosperity will continue.
[ see the book "Of Rats and Men: Oscar Goodman's Life from
Mob Mouthpiece to Mayor of Las Vegas" by John L. Smith
http://www.amazon.com/exec/obidos/tg/detail/-/0929712986/102-2820783-5160940?v=glance ]
[ see the book "Running Scared: The Life and Times of Las
Vegas Casino King Steve Wynn" by John L. Smith
http://www.amazon.com/exec/obidos/tg/detail/-/1568581904/qid=1106007634/sr=1-3/ref=sr_1_3/102-1229350-9432158?v=glance&s=books
]
Stefan Lemieszewski
Stefan Lemieszewski
>
> And with Meyer Lansky mob-lawyer Oscar Goodman as mayor
> of Las Vegas, no doubt the gaming prosperity will continue.
>
> [ see the book "Of Rats and Men: Oscar Goodman's Life from
> Mob Mouthpiece to Mayor of Las Vegas" by John L. Smith
>
>
http://www.amazon.com/exec/obidos/tg/detail/-/0929712986/102-2820783-5160940?v=glance ]
>
> [ see the book "Running Scared: The Life and Times of Las
> Vegas Casino King Steve Wynn" by John L. Smith
>
http://www.amazon.com/exec/obidos/tg/detail/-/1568581904/qid=1106007634/sr=1-3/ref=sr_1_3/102-1229350-9432158?v=glance&s=books
> ]
>
================================
For more information on Meyer Lansky and the mafia in USA, see the research
by criminology Professor Gary W. Potter:
------------
Unit 6: The Development of Organized Crime and the Worlds of Meyer Lansky -
Potter
http://www.policestudies.eku.edu/POTTER/crj401_6.htm
Unit # 6: The Development of Organized Crime and the Worlds of Meyer Lansky
Lansky's Inner Circle
The remarkable career of Meyer Lansky has been frequently retold, most
comprehensively by Hank Messick (1973), but a brief recapitulation might be
useful. Lansky was born in Grodno, Russia, as Maier Suchowljansky in 1902;
and with his family, he migrated to New York in 1911. By 1918 he had formed
acquaintanceships with Bugsy Siegel and Lucky Luciano. As with many others,
Prohibition gave him his greatest opportunity, and the "Bugs and Meyer" gang
rose to celebrity as a bootleggers' mercenary force. By the late 1920s, with
Lepke and Lucky, he pieced together the outlines of a bootlegging syndicate
which would be the dominant influence in organized crime for the next two
decades. After Prohibition, he and Siegel cast their eyes further afield --
to the West, the Sunbelt, the Caribbean. In Miami, Lansky initiated the
"Gold Coast" with its hotels and casinos; in Cuba he created Batista's
leisure empire; in Nevada and California, Siegel used syndicate money to
create a network of enterprises. Siegel died in 1947, having tried to make
himself an independent force, but Las Vegas lived on to flourish and
prosper. Lansky's business enterprises were now sufficiently far- flung to
withstand one setback like that which would be dealt him by Fidel Castro. If
Havana fell, he could turn back to Las Vegas or open new enterprises in
Haiti, the Bahamas, or even in London.
Attempting to describe Lansky's activities is an almost impossible task,
even if we could be sure which of the numerous ventures he is credited with
he was in fact involved in (some authors credit him virtually every
financial scam since 1945). So with this caveat, we can begin to describe
Lansky's activities on behalf of organized crime. First, let's take a look
at the cast of characters which so frequently are participants in
Lansky-inspired activities.
Lansky associates can broadly be divided into two categories: 1) the
old-time veterans of the gangs of the 1920s and 1930s; and 2) newer
associates, usually relatively clean lawyers and businessmen. Lansky appears
to have preserved his friendships and business partnerships over many
decades. For example, after the hit on Bugsy Siegel, control of his Flamingo
Hotel passed to three old Lansky cronies: Moe Sedway from the Lower East
Side of New York, Morris Rosen, and "Gus" Greenbaum from Phoenix (Fried,
1980: 253-254). Some other examples of these long-standing relationships are
instructive.
The Minneapolis mob headed by Isadore Blumenfeld in the 1920s provided
Lansky with some of his most durable business partners. Blumenfeld's bother
"Yiddy Bloom" held substantial investments in Miami area real estate and
controlled a large portion of the New York gambling market (in the supposed
heartland of the "Five Families). Probably his best known financial coup was
the early 1970s stock fraud surrounding the artificial boosting of Magic
Marker shares. Bloom was joined in this by his son Jerold and some fifteen
fellow conspirators. In the background, no doubt were Lansky and other
mutual friends (Pennsylvania Crime Commission, 1980: 195-198).
Also from the Blumenfeld Mob was John Pullman, long used by Lansky in his
banking ventures for organized crime. Pullman had lived in Canada and
Switzerland and was an expert in the use of numbered accounts and dummy
corporations. He was the head of the "Bank of World Commerce" in Nassau
(Bahamas) in the 1960s, a highly effective "laundry" for Mob money
(Pennsylvania Crime Commission, 1980: 198; Fried, 1980: 276-277).
"Dandy" Phil Kastel was part of the 1930s move to the Sunbelt from the New
York mobs. In New Orleans, Kastel bridges the years from the early
bootlegging and gambling syndicates to Carlos Marcello, and through it all,
he was never far from Lansky's interests (Messick, 1969: 105, 205, 247).
"Doc" Stacher (born 1902), emerged from New Jersey organized crime to become
a leader in organized crime's western empire (Fried, 1980: 281-282; Cook and
Carmichael: 62).
Sydney Korshak (born 1907) was patronized early in his career by the Capone
mob. He enjoyed a very successful career representing labor unions and
directed the flow of Teamster money into the Nevada casinos. Korshak
apparently has accumulated enormous wealth from legitimate sources (Fried,
1980: 285-286).
Harry Teitelbaum was a prominent figure in the New York gangs of the 1920s,
who was also associated with the "Bugs and Meyer" and "L and G" gangs. By
the 1950s, Teitelbaum was associated with Nig Rosen in a Lansky-inspired
heroin trafficking operation (Fried, 1980; Cook and Carmichael).
Sam Cohen was a Los Angeles bookmaker who was closely associated with the
Flamingo Hotel in Las Vegas in the 1960s and accused with Lansky of
operating a major skim operation at the Fremont and Riviera casinos. With
his sons Alan and Joel, he was involved in some interesting deals in both
Florida and the Pocono Mountains of Pennsylvania. These real estate deals
were conducted in association with Alvin Malnik, Lansky's supposed "heir."
Sam Cohen fits the pattern we have seen so often, of continuity from the Pro
hibition gangs to the financial world of the 1970s and 1980s. He moved from
New York to Florida in the 1920s and joined the exodus to Nevada in the
1950s (Messick, 1969: 326-331, 363; Mollenhoff, 1973: 186).
Benjamin Siegelbaum was a financial manipulator very close to Lansky, who
was involved in a Swiss money-laundering operation in the 1960s called the
Exchange Bank of Geneva. Siegelbaum had been a partner of Nig Rosen, John
Pullman, Yiddy Bloom, and others in his career.
Morris Lansburgh was a Lansky associate who was extremely powerful in Miami,
where he controlled substantial hotel interests in Miami Beach. He was
alleged to have been a partner with Lansky and Sam Cohen in the Flamingo
skim (Mollenhoff, 1973: 186).
Other prominent figures in the Lansky orbit were newer and more respectable
figures. For example: Delbert Coleman came to prominence in the late 1960s
in the "Parvin-Dohrman" affair. In 1968 Coleman was associated with Korshak
in an attempt to purchase the Parvin-Dohrman casinos in Las Vegas -- and to
float that company's shares artificially. Coleman and Korshak were also
involved in Bernie Cornfeld's IOS scam (Fried, 1980: 282-286; Raw et al.:
229; Demaris, 1981: 247). Another, Alvin Malnik (born 1932), was picked by
some observers of organized crime to be Lansky's probably successor. He
first came to prominence in the early 1960s with the attempt to establish a
gambling resort at Paradise Island in the Bahamas. He had already
established himself in the banking and real estate businesses in Miami but
soon become Lansky's public "front-man." The Paradise Island venture led to
the establishment of Resorts International, the entertainment and gambling
conglomerate which was the subject of intense law enforcement scrutiny for
years as charges of control by Meyer Lansky surfaced (Mahan, 1980).
In the early 1970s, Malnik was also involved with Sam Cohen's sons in land
deals in Florida and the Poconos. Their companies -- COMAL and "Cove
Associates" -- dealt with Caesar's World and the Teamsters Pension Fund,
both institutions which have attracted a substantial amount of law
enforcement attention (Fried, 1980: 282-286; Pennsylvania Crime Commission,
1980: 252- 254). Finally, Allen R. Glick (born 1942) of Pittsburgh attracted
a great deal of attention when his firm ARGENT (A.R. Glick Enterprises)
seemingly came from nowhere to secure a vast Teamsters loan (about $146
million). This enabled him to take over the Stardust casino in Las Vegas and
much of the plundered Parvin-Dohrman company. In 1979 he was implicated in a
skimming operation, which led to his being forced to sell out for a
comfortable profit (Fried, 1980: 284-285; Demaris, 1981: 318, 320, 365-366,
391, 445, 525-526). The operations which these and other organized crime
money- men were involved in recycled the profits of organized crime and in
turn generated immense new profits -- which are, however, almost wholly
clean.
Las Vegas
"Bugs and Meyer" pioneered Las Vegas on behalf of east coast organized crime
interests, investing money from New York, New Jersey, Philadelphia,
Cleveland, and other areas. However, in each case it was Lansky who managed
and coordinated the enterprise. It would be incorrect to suggest that other
mobs, such as the "Cleveland Four," were acting as Lansky servants or as
members of some kind of "Jewish Mafia", but only that their move to Las
Vegas was conditioned by Lansky's enterprises.
The first great hotel in Las Vegas was Siegel's Flamingo (1946). After his
murder, the hotel passed to three old Lansky cronies: Sedway, Rosen and
Greenbaum. Gus Greenbaum would later manage the Riviera, but he fell out
with his Chicago based employers. He and his wife were murdered in 1958.
Thereafter, new casinos appeared in swift succession.
The Thunderbird (1948) was fronted by a former Lieutenant- governor of
Nevada but was really a Lansky operation.
The Desert Inn (1950) was run by the Cleveland Four.
The Sands (1952) was owned by an awesome list of organized crime backers
including Lansky, Adonis, Costello, Stacher, Ed Levinson, Kid Cann, and
Frank Sinatra.
The Sahara (1952) was backed by Chicago, Cleveland, and New York "money
men."
The Riviera was backed by the Chicago mob.
The Dunes was opened by representatives of Raymond Patriarca of Rhode
Island.
The Stardust (1958) was a Dalitz operation, as was the Sundance.
The Tropicana (1957) was backed by Kastel and Costello.
The Palace was opened by Patriarca, Chicago mob investors, Lansky, and
Teamster Union money. Teamster money also flowed into Caesar's Palace, the
Landmark, the Dunes, and the Fremont (Hammer, 1975: 224-225).
By the late 1950s, the casinos were doing an admirable job of making
old-time gangsters quite respectable -- particularly in the case of the old
Cleveland Four. For instance, Cleveland Four veteran Lou Rothkopf's nephew
Bernie was a legitimate businessman, director of the MGM Grand Hotel
(Demaris, 1981: 56- 59). Moreover, the casinos provided wonderful
opportunities for "skimming" to defraud the IRS. In a major scandal at the
Flamingo in the 1960s, Lansky was indicted along with partners Morris
Lansburgh and Sam Cohen. Estimated "skimmed" profits amounted to several
million dollars a year. By the 1970s, the casinos were equally far from
having purged themselves of mob interests. Nick Civella and the Kansas City
mob apparently controlled the Tropicana and the Dunes, in the latter case
through Jimmy Hoffa's attorney Morris Shenker. At the Aladdin, Delbert
Coleman and Ed Torres were believed to be representing someone who wished to
remain hidden.
The ownership of a Las Vegas casino is often frighteningly complex. However,
we might recount the history of one casino in order to give some idea of the
sort of problems involved. In the mid-1950s, the Parvin-Dohrman company
bought the Flamingo. In the 1960s, it bought the Fremont and sold the
Flamingo to a consortium headed by Morris Lansburgh, with Lansky receiving a
finder's fee. The Parvin-Dohrman empire then expanded to include the
Aladdin, and also the Stardust, purchased from Moe Dalitz. In 1968 Parvin
agreed to sell out to Delbert Coleman with Sidney Korshak acting as
intermediary (and getting a $500,000 finder's fee for the transaction). At
the end of 1968, while the sale went through, Coleman and Korshak succeeded
in artificially boosting the Parvin-Dohrman stock from $35 to $141 a share
with the aid of financial impresarios like Bernie Cornfield of Investors'
Overseas Services. After the inevitable collapse, Korshak and Coleman
pocketed their profits and Parvin-Dohrman changed its name to Recrion
(Fried, 1980: 282-286).
At this point, we run into the brilliant young businessman Allen Glick. We
mentioned earlier that in the early 1970s, Glick set up his own company,
"Argent," in Las Vegas and began raising a series of not insubstantial loans
from the Teamsters' Pension Fund. By 1976 Glick owed the Teamsters about
$146 million. In 1973 this largess enabled him to take over all the shares
of Recrion and become a major gambling magnate in Nevada. But it was
scarcely a good investment. Under Glick's management, the Stardust tried too
hard at the skimming game. Some $3.5 million was skimmed from its slot
machines between 1974 and 1976 -- a scale which was regarded as much too
blatant by Argent's entertainment director, Chicago-based gambler Frank
Rosenthal. By 1979, the Nevada Gaming Commission ordered Glick to sell --
which he did, to friends of Moe Dalitz. He sold for a $2 million
down-payment, the assumption of $92 million in debts, and another $66
million to be paid from the casino's earnings by 1991. Presumably, Lansky
was behind at least some of this skullduggery -- but by this stage, he was
extremely adept at hiding his hand.
The Move to Florida
Organized crime's move into Florida came at least as early as the western
migration. Al Capone himself was one of the first to see possibilities in
Florida for gambling and tourism. By the 1930s, mob money was moving into
real estate and into ventures like Tropical Park Race Track in Coral Gables
(a joint new York- Chicago operation), and especially Lansky's Colonial Inn.
The development of Miami Beach coincided with that of Las Vegas. For
instance, in the 1940s, the Wofford Hotel in Miami was the Florida base for
both Lansky and Costello; and the proprietor, Tatum Wofford, was friendly
with rising stars Richard Nixon and Bebe Rebozo. Rebozo himself was close to
the Cleveland syndicate. By the 1950s, organized crime had a well developed
role in Miami hotels like the Sands and the Grand. By the 1980s, some
estimates claimed that roughly half of Miami Beach hotels were connected to
mob money through Lansky or associates like Lansburgh and Yiddy Bloom
(Moldea, 1978: 105-107).
Florida also provided an extremely valuable banking structure which could be
used by organized criminals from all parts of the country. This was
unraveled (at least in part) by investigations surrounding the Watergate
affair of the 1970s. For example, the scandal of Nixon's "Winter White
House" revealed some interesting connections concerning the "Keyes Realty
Company." This company was named in the Kefauver hearings for its role as
intermediary in bribes between organized crime and Dade County political
officials. In the 1940s, it played a major role in developing Miami
gambling. In 1948 this company transferred a Key Biscayne property to ANSAN,
"a shadowy Cuban investment group" in which syndicate money was allegedly
involved. This linked the Cuban ancien regime (such as Jose Aleman) with
Batista and Luciano allies. Later, control of this real estate passed to two
new groups: the Teamster's Union Pension Fund and Lansky's Miami National
Bank. In 1967 this land passed to Nixon and Bebe Rebozo at bargain rates.
One of the Watergate burglars, a Cuban exile, was a vice president of Keyes
Realty.
The Miami National Bank is an interesting case study in itself. In 1958, it
was taken over for the Teamsters, using Lou Poller as a front. Poller
specialized in "laundering" money, and, not surprisingly, he owed his
primary loyalty to Lansky. Organized crime money now reemerged in the form
of real estate, apartment buildings, hotels, motels, and mobile home
companies. The Teamsters acquired this bank through Arthur Desser, another
link between Hoffa and Lansky, and it was Desser who made the 1967 Key
Biscayne sale to Nixon and Rebozo (Cook and Carmichael; Scott et al., 1976:
356-358; Hinckle and Turner, 1981).
By the 1970s, a "subculture of banks in southern Florida" was linked by
"interlocking directorates and major investors" (Freed, 1980: 141). Besides
the Miami National, there were the Bank of Miami Beach, International Bank
of Miami, the Key Biscayne Bank, and Southeast First. Federal prosecutors
linked Southeast First to the intelligence community and especially to the
1976 murder of Chilean exile Orlando Letelier. These banks have also been
associated with the Lansky and Luciano mobs and the Cleveland, Boston, and
Las Vegas crime organizations.
Cuba
Cuba represented the first major international venture of organized crime
(Messick, 1967; 1973; Blakey and Billings, 1981: 228-232; Hinckle and
Turner, 1981). Lansky had acquired the Hotel Nacional in Havana as early as
1937, and this gave his friends a foundation on which to build after
Batista's coup of 1952. Casinos now appeared rapidly -- Lansky's Havana
Riviera, run by the Cellini brothers; the Havana Hilton; the San Souci; the
Capri; the Commodore; the Tropicana. At the Nacional, Cleveland money was
the key investment, but the operator was Jake Lansky, and in each case there
were massive opportunities for skimming. Castro's revolution came as a
disaster for American crime, but Lansky's circle of investors was already on
the lookout for opportunities further afield.
The Banks
At least by the 1950s, organized crime was learning the importance of clean
money; no longer could gangsters depend on the loyal silence of bankers as
in the bootlegging days. Lansky learned the techniques of "laundering"
profits, especially through Swiss numbered accounts. Nig Rosen used such
Swiss bank accounts for his heroin "connection" in the 1950s. Soon, Lansky
and his associates established their own banks. Malnik established the Bank
of World Commerce in Nassau. Mob money flowed into the Bahamas, before
passing to Tibor Rosenbaum's International Credit Bank in Swtizerland. Then,
it could return to the U.S. for reinvestment. At every stage in these
operations, we find familiar faces: the Bank of World Commerce has headed by
John Pullman, and investors included Ed Levinson. In turn, Levinson and
Siegelbaum were active in other Swiss "laundry shops," the Exchange Bank of
Geneva. Finally, we have observed the growth of the Florida network.
These banks could provide a clean base for further ventures. For instance,
it was Rosenbaum's bank which supported Cornfeld's IOS. Again, the Overseas
Investors Corporation gave Robert Vesco his opportunity to plunder a
fortune. Both the Vesco and Rosenbaum ventures collapsed by the 1970s. They
certainly have their successors, although full details will only become
apparent when they in turn reach their inevitable date with fiscal reality
(Raw et. al., 1971; Fried, 1980: 276-286; Clark and Tighe, 1975; Hutchinson,
1974; Messick, 1969: 201-209).
The Bahamas
Summarizing the complex saga of gambling in the Bahamas is no easy task. But
briefly in the 1950s, the success of Lansky's ventures in Cuba led to
attempts to establish similar gambling enterprises elsewhere. The frontmen
for the Lansky enterprise were Wallace Groves and Louis Chesler. They
attempted to develop a "freeport" in the Bahamas; and in the early 1960s,
Lansky interests were established at the Freeport Monte Carlo casino. This
casino was managed by two of Lansky's longest-established gambling
technicians, Dino and Eddie Cellini (Mahon, 1980).
Also in the late 1950s, Huntingdon Hartford was attempting to found a casino
at Hog Island -- promptly rechristened "Paradise Island." However, he found
considerable difficulty in getting a gambling license from the governmental
minister concerned, Sir Stafford Sands. At this point Alvin Malnik entered
the picture. Malnik made a very tempting offer: Paradise Island would be
bought out by a firm called Mary Carter Paint, and Lansky would see to
obtaining a gambling license. The dating of this deal in the early 1960s was
important; obviously, Lansky was seeking another Caribbean haven to replace
Castro's Cuba. He brought with him old gambling partners like Max Courtney,
"Trigger Mike" Coppola, Frank Ritter, and the Cellini brothers.
From the mid-1960s, events happened rapidly; in 1966 Hartford and his
adviser, Seymour Alter, sold Paradise Island to Mary Carter Paint. In 1967
the Paradise Island casino opened with a glittering assembly of guests --
including Richard Nixon, and in 1968 Mary Carter Paint changed its name to
"Resorts International." However, the pressure was also intensifying,
especially after Sands' party was defeated in the 1967 election. Lansky
involvement in the casino was blatant, represented as it was by the presence
of Dino and Eddie Cellini -- both veterans of gambling operations in
Kentucky and Cuba. In the U.S., the Organized Crime Strike Force of the
Justice Department was appalled by the Lansky operation and began to release
information about it to the media. However, it was the Watergate affair
which led to the greatest embarrassments. It was suggested that Resorts
International had been linked to Bebe Rebozo, that Resorts and Robert Vesco
had been laundering Nixon campaign money, and that Seymour Alter had been
the bagman for Vesco, Rebozo, and Resorts. Clouds were gathering over
Paradise Island but not sufficiently to prevent Resorts International from
acquiring a gambling license in New Jersey (Mahon, 1980; Cook and
Carmichael).
International Activities
Tax Havens. Organized crime learned long ago that it was useful to register
companies and place investments in foreign nations with fairly lenient laws
on the transfer of money. Examples include Switzerland, Liechtenstein, the
Bahamas, Panama, the Cayman Islands, and the Netherlands Antilles. There
would certainly be other countries where investigators have been slow to
look for "front" companies, such as the Irish Republic.
The Industrialized World. Organized crime money has flowed freely into
Canada -- Sturman money through Morton Goss in Toronto and Lansky's
interests through John Pullman. Also, Canada's convenience for drug
importation has made cities like Montreal open organized crime territory.
Quasi-political organizations like the Quebec FLQ dabble in the Miami drug
trade.
Britain has proved an equally tempting target since the legalization of
gambling there in 1960. Lansky, the Cellinis, Angelo Bruno, and others all
made exploratory journeys there in the 1960s. The British government closed
casinos because of alleged organized crime involvement -- the Colony Club in
1966, and Penthouse magazine's interests in 1971. British gangsters like the
Krays also tried to link up with U.S. colleagues -- apparently both Bruno
and Lansky. In England as in Holland, Sturman has made major incursions into
the pornography trade (Blum and Gerth, 1978).
When Australia was discussing the legalization of gambling in the mid-1970s,
the Bally corporation attempted to gain a foothold, but extensive
connections with Dino Cellini and Gerry Catena led to their exclusion (Blum
and Gerth, 1978). Bally was much more successful in its ventures in Sweden
(Block and Chambliss, 1981: 135-142).
South America. In Latin America we find the most consistent pattern, hardly
surprising if we look at the prosperous cities frequented by Americans in
the 1930s and 1940s -- Havana, Rio, Buenos Aires. In addition to Cuba, there
is clear evidence of organized crime involvement in a number of other
countries.
Mexico. In the National Lottery scandal of 1947-1949, Mexican senators were
bought by mob money. Also, there is an interesting connection through Gulf
and Western Corporation to Mexican operations. In 1970 the Illinois Racing
Commission found that Gulf and Western was a partner with Philip Levin (a
Gulf and Western director) in the Acapulco Towers Hotel. This hotel was run
by Moe Morton, who entertained there in 1969 an impressive guest list:
From Miami: Lansky
From Las Vegas: Dean Shendel, Moe Dalitz, Hyman Segal
From Montreal: Tony Roma
From Chicago: Sydney Korshak, Delbert Coleman
In 1970, Acapulco was the center for a further meeting involving Lansky,
Levin, Korshak, and Newton Mandell of Gulf and Western (Gulf and Western was
also associated with Michele Sindona, the Italian banker whose collapse in
the late 1970s caused major damage to the Vatican's finances) (Lernoux,
1980: 240). Gulf and Western was also the corporation that U.S. military
intervention in 1965 brought to a dominant role in the small Dominican
Republic, where it enjoys the rights of a feudal barony. It is also widely
active, for instance, in Brazil.
Honduras. Leading army officers were involved with organized crime in making
the country a bridge for the cocaine traffic.
Guatemala. Guatemalan government officials provided Carlos Marcello with
phony nationality papers after his expulsion from the U.S. by the Kennedy
Justice Department.
Costa Rica and Nicaragua. Both of these countries were CIA fiefdoms in the
1950s and 1960s and were heavily involved in anti-Castro plots. Those CIA
ventures involved dabbling by organized crime, primarily through Marcello
and Trafficante. Dictators like Stroessner (Paraguay) and the Somozas were
easy targets for organized crime blandishments.
Argentina. Lansky's South American drug trade was coordinated by August
Ricord from Argentina (Chambliss, 1978: 165).
Other Financiers
Moe Dalitz: In a FBI wiretap, the New Jersey gangster "Gyp" De Carlo
remarked, "There's only two Jews recognized in the whole country today.
That's Meyer and ... Moe Dalitz." We have already discussed Dalitz' role in
the "Cleveland Four" and his move into Las Vegas, especially his involvement
at the Stardust and the Desert Inn. However, in the mid-1960s, income tax
trouble and heat from the Casino Control Commission forced him to sell his
enterprises. With the help of a large Teamster Union loan ($57 million
between 1964 and 1972), Dalitz established an extremely posh country club at
La Costa, north of San Diego. We have already discussed the consequences of
his sale of the Stardust to Parvin-Dohrman, but in 1979 an old associate of
his bought back these casinos after the departure of Allen Glick. Like
Lansky, Dalitz has proceeded from the bootlegging underworld to very
substantial prosperity. In 1980 a Forbes article estimated his wealth in the
$100-150 million bracket, second only to Lansky among the alumni of
organized crime. It also cited his extremely healthy investment portfolio --
including Detroit Steel and the Rock Island Railroad (Cook and Carmichael).
Frank Erikson: Born in 1896, Frank Erikson was one of the most important
organized crime figures in New York with a career stretching from the 1920s
to the 1950s. In addition to his New York operations, he owned "points" in
Meyer Lansky's Colonial Inn in Florida; he leased the rights to a horse
parlor at the Roney Plaza Hotel in Miami; he owned a piece of another
Florida casino, the Farm, and he ran bookmaking operations which covered the
Florida race tracks (Kefauver, 1951: 811-830). In addition, Erikson ran an
extensive bookmaking operation throughout New Jersey. Erikson had legitimate
holdings, such as the Park Avenue Theater and the Anderson Galleries in New
York City. One of his more surprising holdings was Bruil Petroleum, which
had vast oil interests in Texas. Erikson was a close friend and associate of
Frank Costello, with whom he probably shared control of New York bookmaking.
In addition, Erikson was in business with Meyer Lansky, "Dandy" Phil Kastel,
Willie Moretti, Charles Fischetti, Joe Massei (from Detroit), Willie
Bischoff, and Little Augie Pisano. Despite Erikson's rather successful
efforts to shield himself from too much public scrutiny, it is clear that he
played a major role in the organizing of crime networks in New York and
Florida, he was certainly someone with considerable financial resources to
be brought to that organization.
The Teamsters and the Dorfmans: Anyone studying organized crime will have
frequent call to look at the activities of the Teamsters' Central States
Pension Fund. This fund -- it passed the billion dollar mark in 1972 -- has
served as an organized crime bank. It has largely financed the development
of Las Vegas and of gambling and leisure in Florida and California; it
financed the La Costa Country Club and the "Cove Associates" deal; it
finances real estate deals, and played a large role in the deals which
resulted in removing President Nixon from office. From the 1950s to the
1970s, this fund was largely directed by Paul Dorfman and his stepson,
Allen. Let us trace the progression of events by which this vast fortune
passed into the hands of men accessible to organized crime interests.
In the 1930s, the teamsters secured their position by providing employers
with a tame and amenable alternative to the radical CIO and the Communists.
From the early 1930s, the leadership was closely tied to gangsters --
especially in Detroit; but by the late 1940s, Jimmy Hoffa had consummated
the organized crime - Teamster Union alliance. Hoffa's former mistress
became friendly with Moe Dalitz, and this contact gave him a whole series of
Mob friends -- the Pressers in Cleveland and the Chicago mob. From the
latter, Hoffa became close to Paul Dorfman, an associate of Anthony ("Big
Tuna") Accardo. Dorfman had a distinguished record in the Capone mob as a
labor racketeer. In the 1920s and 1930s, he had led the corrupt Chicago
Wastehandlers Union after the murder of a predecessor (a murder allegedly
carried out by Jack Ruby) (Moldea, 1978: 49-50, 55-58, 86-88, 141-49;
Demaris, 1981: 321-326, 342, 378, 402).
In 1951 the Teamsters set up the Central States Health and Welfare Fund, the
insurance portion of which was run through a company managed by Paul's
inexperienced stepson, Allen Dorfman (born 1923). Allen learned quickly. He
guided the investments both of the Teamsters and of Hoffa personally. They
moved into oil, stocks, and especially real estate -- one unusually corrupt
deal involved the Sun Valley retirement community, a deal which would later
result in legal trouble for Hoffa. In 1955 the union established a new
Central States South Eastern and South-Western Pension Fund, run almost
entirely by the Dorfmans.
Allen did extremely well. His own Union Casualty Agency had now become a
substantial conglomerate. It owned insurance companies, oil interests, and
slum housing; it held real estate -- even a resort in the Virgin Islands.
From the 1950s, the alliance with Lou Poller's Miami National Bank gave the
Dorfmans a "laundry" akin to Lansky's. The move into the Sunbelt was
reflected by friendship with Dave Yaras and through him with Carlos Marcello
and Santo Trafficante. Allen Dorfman was a man of great importance, close to
the Chicago and Cleveland syndicates, to Las Vegas and all the varied
interests the Teamsters had funded. Allen himself was succeeded in the
Teamsters by Alvin Baron as "Asset Manager." Who had benefitted from the
Dorfman's largess? When the old trustees relinquished their control of the
Central States Pension Fund in 1976, the chief recipients were familiar
faces (Cook and Carmichael):
Allen Glick -- $140 million
Morris Shenker -- $135 million
Moe Dalitz -- $93 million
Alvin Malnik -- $20 million
Ed Levinson: In 1963 a Senate inquiry into misdeeds by Bobby Baker was
interrupted by protests from Baker's attorney, Edward Bennett Williams.
Apparently, Baker's conversations with a gambler named Levinson had been
wiretapped, and Williams protested that this constituted a violation of
Baker's civil rights. However, he had misunderstood one major point: the
target of the investigation was not the wayward politician; it was the
powerful, but little-known gambler.
Ed Levinson was born in Chicago and had operated as a gambler in Detroit,
Miami, and quasi-"open cities" like Newport or Covington (both in Kentucky).
In 1952 he had joined the mob migration to Nevada. He bought into the Sands,
then the Flamingo, and later the Fremont. This he accomplished with the help
of a Teamster loan, and he began a sizable skim operation of between one and
two million dollars a year in the early 1960s. Meanwhile his brother Louis
kept a foothold in the Cleveland syndicate's territory of northern Kentucky
(Messick, 1969: 348-362; Mollenhoff, 1973: 104, 114-116; 187-189).
Levinson was extremely well-connected both with the legitimate and the
criminal worlds. "Above ground" his connections were so good as to secure
access to secret FBI wiretaps while he contributed generously to Nevada
politicians at all levels of government. In the underworld, he was close to
Lansky faithfuls like Doc Stacher and Benjamin Siegelbaum while he
participated in the Bank of World Commerce and the Exchange Bank of Geneva.
In 1962 the IRS began a large-scale investigation of Las Vegas "skimming."
This resulted in 1967 in convictions for the Fremont and for the Riviera - a
Sam Cohen operation. Levinson was fined a token sum but his notoriety was
primarily due to the Baker link. It is interesting that so major an
organized crime figure should only be revealed to the public gaze because of
a friendship with a corrupt politician stupid enough to associate publicly
with the likes of Levinson and Siegelbaum. How many other Levinsons are
there who have avoided such a fatal mistake (Mollenhoff, 1973)? In short,
like Dalitz, Levinson seems to be another example of the rise from organized
crime to corporate business.
Reuben Sturman: Sturman is a figure of considerable wealth and influence,
whom frequent reports have linked to organized crime. This does not
necessarily mean that he was himself a criminal -- though his pornography
trade floated on the margins of legality, and he was convicted on both RICO
and tax charges in the late 1980s. Nor does it mean that he is in any sense
a servant of organized crime. He is merely an interesting example of the
sort of rich and powerful figure who is extremely hard to fit into
traditional models of organized crime. By contrast, he can easily be
reconciled with theories which emphasize the coordinating role of capital
and finance.
Sturman was born in 1924. By the late 1970s, he owned perhaps 800 retail
pornography stores in the U.S., often through very complex patterns of
concealed ownership. In England he worked in close collaboration with local
organized criminals, like the Holloway family, a well-established
pornography group. On the European continent, his chief foothold was through
a firm called Intex Nederland, a key distributor of pornographic videos. A
subsidiary of Intex is Video-Rama, which distributed pornographic videos
throughout Europe and to the extremely lucrative Middle Eastern market of
Cairo, Beirut, Kuwait City, and Riyadh. Firms like Intex, Video-Rama, and
their associated companies (like First Columbus Trust) are registered in the
Netherlands Antilles, a territory whose laws of business secrecy make the
Swiss look ostentatious (Pennsylvania Crime Commission, 1980: 118-121).
What we have here is a worldwide pornography syndicate -- not a monopoly
perhaps, but an enormously powerful conglomerate -- and a syndicate whose
representatives were all but unknown to the general public. Who had ever
heard of Sturman or his representatives, like his son David Sturman, like
Scott Dorman, or Frank Bilitz of Baltimore? In the Miporn investigation
(1977- 1980), the FBI found Sturman associated with mobsters like Robert
DiBernardo and Teddy Gaswirth (Pennsylvania Crime Commission, 1980: 118).
Were there Others?
Was Lansky the only operator on his scale, or were there others? If so, how
many? Three? Fifty? It's difficult to say. We can only indicate briefly that
there seem to be others much less publicized, whose command of wealth is
awesome. For instance, there is no doubt that when Doc Stacher fled to
Israel, he retired a rich man (worth at least $100 million). John Pullman
may well have accumulated the same sort of fortune over the years. Even if
they were this wealthy, did they act as independent financiers? It seems
that these are vital questions to answer in order to appreciate the nature
and scale of organized crime.
CRJ 401: Organized Crime
Gary W. Potter
Eastern Kentucky University
===================================
yp
<ste...@direct.ca> wrote:
> http://www.icg.org/home/index.cfm?l=1&id=3201
>=========================================
>
>It's been pointed out that in Ukraine, the mafia oligarch,
>Viktor Pinchuk is a board member of the International Crisis
>Group.
(skip)
>Stefan Lemieszewski
>
Hey Lemi, where have you been? Your last couple of messages were in
the middle of November and I was hoping that you decided to stop
filling this NG with all those articles that no one has time to read.
But you came back really strong. 11 postings in a row. Hint: be a bit
more selective.
Happy New Year anyway.
Yuri