In the mid-40s, things were pretty hot for Benny Siegel in New York. He was the key suspect in a murder and Meyer Lansky was having a hard time keeping him under control. The two were still as close as ever, but Benny was chafing under Meyer’s leadership. Bugsy needed to go out on his own, Meyer decided, and so Benny headed west to Los Angeles to bring the operations in California under the Syndicate’s control.

Benny quickly rose to the top out west and began to expand the Syndicate inland. He looked east to Nevada, and saw a small town at the southern tip called Las Vegas. Siegel wasn’t the first man to build a casino there, but he was the first mobster with Syndicate connections to realize that putting a casino in Las Vegas could mean a license to print money for the mob.

In the years since Benny moved out west to cavort with starlets and take over the Hollywood extras union he and Meyer had remained close. Armed with mob money, Siegel tried in 1943 to buy his way into a partnership with the owners of the Last Frontier in Vegas, which was then the hot spot in town. The owners went public with Siegel’s action and rejected him. Instead, Siegel and Lansky acquired El Cortez, a downtown hotel and casino that had been open for several years, serving both local clientele and soldiers from the nearby army air base and gunnery school.

Meyer did not share Siegel’s enthusiasm for Las Vegas, telling his friend the city was in "sorry shape" and concentrating on his carpet joints in Florida. He put up a $60,000 investment in El Cortez and became a silent partner – letting Siegel run the show. Soon after the men bought the casino, Siegel sold the operation and netted a $166,000 profit – a 27 percent return on their investment in just 6 months.

In 1946, with the Las Vegas real estate market booming, Benny convinced the investors in El Cortez to reinvest in a bigger, larger, more fabulous new casino he was going to build. The Flamingo – named for his girlfriend, Virginia Hill – would be a glitzy alternative to the dude-ranch style hotels like El Cortez and the Last Frontier.

Lansky allowed Siegel to reinvest the $650,000 from the sale of El Cortez into the Flamingo, buying a 66 percent stake in the casino.

"As controller of the majority consortium, Benny set himself Christmas 1946 as his deadline for getting the Flamingo finished," Lacey wrote. "But he immediately developed bright new ideas for improving the rooms…. The charming and imperious Ben Siegel totally lacked his friend Meyer’s sense of control."

There were incredible cost overruns and delays caused in part by Siegel’s ignorance of how to build a hotel of the magnitude of the Flamingo and partly because of the booming post-war construction industry.

In Havana, where Meyer Lansky, Lucky Luciano and the rest of the heads of the Syndicate were meeting in secret because of Luciano’s exile, Lansky was forced to tell the bosses that the cost of the casino would far exceed the $1 million they had been told. In fact, Meyer admitted, the Flamingo was likely to cost the Syndicate about $6 million before it would be completed.

Immediately, there were calls for Siegel’s head, but Lansky was able to pacify them with promises of huge inflows of cash once the buildings were completed.

What was unsaid at the meeting in Havana, was that some mobsters were getting suspicious of the frequent trips Hill was making to Geneva, Switzerland, reportedly on "buying trips." The gangsters believed Hill and Siegel were skimming investment money and secreting it away in a numbered Swiss bank account.

"This sort of behavior meant only one thing in the underworld," Doc Stacher said. "Bugsy was going to be hit. Meyer knew it too, but he did all he could to save his friend."

Meyer talked the men into giving Bugsy until the spring to turn a profit, and then went to Las Vegas to try and talk some sense into his old friend. Benny had turned decorating control over to Virginia Hill, who was in many ways responsible for the overruns. When Meyer returned from Las Vegas, he was quite dejected.

"I can’t do a thing with him," Lansky told Stacher. "He’s so much in that woman’s power that he cannot see reason."

Luciano told Lansky that Bugsy would have to get things under control or he would order their old friend killed.

"Unless Bugsy makes a great success of that hotel, you know as well as I do that he will have to be hit," Luciano told his friend. "And if you don’t have the heart to do it, Meyer, then I will have to order the execution myself."

Doc Stacher reported that Luciano’s comments brought tears to Meyer’s eyes and he excused himself from the meeting with bosses. For two hours, he remained in his suite at the Hotel Nacionale before calling friends in the States and ordering them to keep an eye on Benny.

"If anything happens to him," he told Benny’s lieutenant, "You will answer to me."

flamingo hotel.GIF (69795 bytes)
The Flamingo Hotel, Las Vegas
(Lake County Illinois Museum)

Siegel managed to get the casino completed by his self-imposed December 1946 deadline, but not the hotel portion. On December 26, the casino opened with Xavier Cugat’s orchestra providing the music and Jimmy Durante and Rose Marie providing the comedic entertainment. At the gambling tables, nothing went right for the mobsters. Although in the long run the house cannot help but win because of the way the games are structured, in the short run the guests at the Flamingo cleaned the casino out of $75,000 in the opening evening.

Siegel managed to struggle on for two weeks before realizing that the casino would have to close when the hotel was being finished. Back in Cuba, Lansky once again saved Benny’s life by coming up with a plan to put the Flamingo in receivership and setting up a new syndicate to buy out the old corporation. Luciano backed Lansky’s plan, despite reservations by a number of other bosses.

In March, the Flamingo reopened and by April it was starting to get out of the red. In May the casino turned a profit, but for some reason it was too late to save Benny. In mid June, 1947, sitting in his apartment in Beverly Hills, Benny Siegel was gunned down by an unknown killer.

Shortly after Siegel died in California, two men working for Meyer Lansky walked into the Flamingo and announced that they were taking over. Maurice Rosen and Gus Greenbaum had worked for Lansky in Miami, Havana and New York, which gave a great deal of strength to the theory that in the end, Lansky had ordered his best friend killed.

Lansky, however, denied having anything to do with Benny’s killing.

"Ben Siegel was my friend until his dying day," he told Uri Dan. "I never quarrelled with him. If it was in my power to see Benny alive," he added. "He would live as long as Mathusala."

bugsy dead 1.GIF (75675 bytes)
Bugsy shot, 1947 (AP)

1. The Mythical Meyer

2. A Fortune Found

3. Bugs & Meyer Mob

4. Meeting with the Brain

5. Italian and the Jew

6. The Carpet Joints

7. Havana

8. Vegas

9. Israel

10. Lansky's Legacy

11. Bibliography

12. The Author
<< Previous Chapter 1 - 2 - 3 - 4 - 5 - 6 - 7 - 9 - 10 - 11 - 12 >> Next Chapter
truTV Shows
The Investigators
Forensic Files
Missing Persons Unit

TM & © 2007 Courtroom Television Network, LLC.
A Time Warner Company. All Rights Reserved. is a part of the Turner Entertainment New Media Network.
Terms & Privacy Guidelines