1952

The life of wealthy, prominent businessman with several connections to the gambling industry, Thomas “Tom” A. Keen, 56, was abruptly ended at about 10:07 a.m. on Tuesday morning, February 5. 

After giving some duck eggs to a neighbor, this San Mateo, California resident walked back home. He grabbed his coat, kissed his wife good-bye and went to their detached garage to leave for work.

Once in his green Cadillac Fleetwood, he stepped on the starter. Dynamite hidden under the floorboards ignited and blew up. The fatal explosion propelled Keen’s body into the car’s back seat and sheared off his legs.

Car parts took flight. One side of the garage blasted apart. Windows of the Keen’s 16-room mansion shattered, covering the driveway and sidewalk with glass. Two windows of a home across the street also broke into pieces.

“The terrific explosion scattered flesh, metal and wood over a wide area,” reported The Humboldt Times (Feb. 6, 1952). “It was heard for blocks by residents.”

Connections To Gambling

Example of a more modern dog racing tote board

The San Mateo, California resident had worked for the past couple of decades years in the field of dog racing and horse racing. First, he’d built and operated the dog racing tracks in Belmont and Bayshore City in The Golden State. He’d co-invented the mechanical hare used in the sport. When California outlawed dog racing, he’d shifted his business focus to manufacturing and supplying totalizators,* also called totalizers and tote boards, for race tracks. Currently, he was president of the International Totalizer Company, based in Belmont.

Keen’s work took him around the U.S., to states where dog and horse racing were legal. Most recently, he’d been to Phoenix, Arizona to install one of his totalizators at a dog track. One month earlier, he’d installed five of his quinella** machines in the Miami Beach Kennel Club for purposes of demonstration.

Keen had ties with many dog and horse track operators, many of them connected. At the time, Mobsters controlled many such tracks in the country.

The Tucson-born track betting equipment mogul owned stakes in many tracks, including Sportsman’s Park in Cicero, Illinois; the Multnomah Kennel Club in Portland, Oregon; and the Mile High Kennel Club in Denver, Colorado.

“He had no one to fear,” said Keen’s friend and sports shop owner Joe Darcy. “He was never afraid. He did nothing but good for hundreds of people. Who could have done something so horrible?”

Keen

Theory No. 1

According to San Mateo Police Chief Martin McDonnell, Keen likely was killed because he took business into a territory out of which he’d been warned to stay. His department’s investigation led McDonnell to deduce Keen had been killed because he’d tried to place his quinella machines in a certain Florida hotel. The chief also surmised there most likely had been two killers, carrying out the assassination on behalf of a Mobster boss somewhere on the East Coast.

Theory No. 2

The second hypothesis was put forth by the California Crime Commission, which had held an unprecedented closed hearing in early May 1952 to investigate the Keen case. In its final report, the commission purported that Keen had been murdered because he’d owed the Olmo Group bookmaking enterprise about $20,000 (roughly $210,000 today).

Allegedly, Keen had been an Olmo customer and a heavy bettor and had refused to pay his debt even after the group’s enforcer Richard “Big Dick” C. Trabert had tried “persuading” him to do so. As a result, supposedly Mobster-gambler Emilio Giorgetti and John O’Neil, also part of the Olmo ring, had been forced to cover the loss. (Keen’s estate at the time he passed away was worth $204,000 (about $2 million today).

The San Mateo County District Attorney Louis B. Dematteis, who wasn’t corrupt, didn’t give the bad debt theory much credence, he said. The timing — Keen being murdered two years after the Olmo Group had disbanded — didn’t make sense. Dematteis thought it more probable the murder was tied to more recent events.  

The actual motive behind the murder of Thomas Keen remains a mystery; the crime still is unsolved.

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* A totalizer is the system for running parimutuel betting. It’s an electrically operated board that flashes the changing odds and total bets before dog and horse races and the payoff amounts after.
** A quinella, or quiniela, is a bet in which the first two places in a race must be predicted, but not always in the correct order. Quinella machines, which displayed these types of bets, were used in dog, but not horse, racing.

Part II and Part III.

Sources

The Harmony Kid made his living as a traveling gambling cheat in the U.S. and was known from coast to coast. While primarily a card and dice sharp, Lawrence Varner (1865-1933) also perpetrated swindles related to roulette and horse races. He he obtained his moniker because he was born and lived for decades in New Harmony, Indiana.

He was “one of the most notorious gamblers and sporting men in the country,” wrote The Democrat in 1892. That newspaper shared what a colleague of Varner said about him: “That fellow has won more money in the last two years than any three men in the country in his life, but it goes like the wind. He is never broke, though, and has lots of friends in every city in the Union.”

Cons and other crimes were part and parcel of Varner’s career despite his having a family of his own. Here we create a snapshot of his “professional” life through some highlights, presented chronologically.

1886: His Unfailing Bones

This year, craps was introduced in Cincinnati, Ohio. Using his trusty method of cheating, the Harmony Kid stunned the naivete right out of two of the game’s operators there, taking one for $900 ($25,000 today) and the other for $1,100 ($30,000).

During play, Varner “would sling his money around promiscuously and give the house dice a wicked twist with the result that one of them would jump off the table, and on to the floor,” described The Daily Times-Star (June 10, 1924). While retrieving the errant die, he switched out both for his own set of stolen tops and buttons, misspotted dice with which one can’t roll certain losing combos. Varner’s bones lacked ones and sixes, minimizing his chances of landing on the dreaded seven. 

“To add insult to injury, the ‘Harmony Kid’ wrote a scurrilous letter to each of the Cincinnatians in which he told [them] that what [they] didn’t know about that little old game would fill a cistern,” reported The Daily Times-Star (June 10, 1924).

For the rest of his life, the Harmony Kid steered clear of Cincinnati.

1889: Escalated Card Game Dispute

During an argument with an Indiana saloonkeeper, Dallas Tyler, in Washington, Indiana, about a card game, Varner shot him. The bullet hit Tayler on the inside of one of his legs. Varner escaped, and Tyler survived.

1890: Wedding Bells Ring

The Harmony Kid married Laura Warden in Kentucky and went on to have at least two children.

1893: Arrested for Murder

Varner was charged with murdering a George Franklin, who’d been found dead on the train tracks in New Harmony with a fractured skull and two head gashes. He’s last been seen at the fair. It’s unclear why the Harmony Kid was fingered for the crime. During his trial, the jury couldn’t agree, with 10 for acquittal, two for conviction. Eventually, the case was dismissed.

1898: Off To The Great White North

During The Klondike Gold Rush, Varner and some buddies traveled to this region in Canada’s Yukon Territory to make a fortune. Their hopes were dashed, though, when they discovered there really wasn’t any money there for the taking. After six months with nothing to show for their time spent there, the group returned to the Lower 48.

1900: A Needle In A Wheel

With fellow gambling cheat and Indianan Jim Pents, the Harmony Kid swindled Columbus, Ohio gambling room owner John Alexander, known as the Black Prince, out of $400 ($11,000 today) at the roulette wheel. Varner and Pents had broken into Alexander’s place of business the day before and inserted a needle into the wheel. Pressing on the needle stopped the wheel.

On the day of the swindle, the two showed up dressed as farmers. They played some faro and lost. The roulette wheel operator enticed them to try their luck with him, so the duo made a few bets and lost. Then a third man, a secret associate of Varner and Pents, entered the business. He acted as though he was just watching the action, but intentionally stood blocking the operator’s view of the Harmony Kid.

Pents made the bets, and when he signaled, Varner pressed the needle. Every time they did this, they won, an average of $53 a turn. Alexander paid them in certificates of deposit but later, when he discovered they’d rigged his wheel, he stopped payment on them.  

“Not long ago [Varner and Pents] cleaned up $1,400 in Lexington by the same game,” reported the Greencastle Star-Press (July 28, 1900). “They have skinned a [gambling] bank in almost every big city in America. Both men have been principals in similar skinning affairs for years back.”

1903: Clever Horse Race Scam

The Harmony Kid employed a system for betting on the horse races at the pool rooms in New York, New York that generated between $2,000 and $3,000 (about $55,000 to $82,000 today) a day. After months of doing this six days a week at such enterprises in The Big Apple, the proprietors caught on, and they all banned him from their business.

Varner’s scheme was this: In the morning  at every pool room, he left a note with his bet, which was on a horse to come in as good as third. He purposefully always bet on a favorite because there wasn’t any third place money for the horses in this class in any race. He also indicated he wanted the form sheet in a certain newspaper to dictate his payout should he win. Those amounts tended to be prohibitive.

So every time Varner’s horse lost, the bookies had to give Varner back the money he bet, and any time his horse won, they had to pay him a large amount.

“In other words, the poolroom men were being constantly drained out of their money without a chance of winning a cent,” reported The Ottawa Journal (Nov. 7, 1903).

1904: More Creative Cheating

With an accomplice, also from Indiana, the Harmony Kid pulled a different, less complicated roulette cheat. In a gambling room in Pekin, Illinois, the two slowly made their way over to the roulette wheel. After playing and losing for a bit, Varner asked the wheel operator for some cigars. He went to retrieve some, and while away, the Harmony Kid somehow plugged the wheel. After that, the two cheats won on nearly every turn. They only played for a half-hour, but in that time racked up $465 ($13,000 today).

Also this year, Varner fleeced various bookmakers in Hot Springs, Arkansas out of about $9,000 ($247,000 today) in all. At several betting parlors, he and eight other swindlers wagered on various horse races. When the results came over the wires, everyone in his group won and collected their winnings. The announced winners, however, weren’t the actual winners.; the broadcast was fake, previously arranged by Varner.

For this fraud, Varner ultimately was arrested in St. Louis, extradited back to Arkansas and held over for a grand jury investigation. The charge was obtaining money under false pretenses. What happened in the case is unknown as the story disappeared from the headlines.

1910: Four-Minute Fraud

The Harmony Kid blew into Reno, Nevada on a train. It was the last chance to gamble there, as a new law mandated a permanent statewide shutdown by midnight that day. After ambling through the three still open casinos, he sat down to play craps in the Casino. By this time, he’d modified his dice switching modus operandi, pulling them from a sleeve as he pushed it up. Using his infamous misspotted dice, he took the house for $500 ($14,000 today) in only four minutes.

“He made every kind of a complicated bet, shooting continuously, and keeping the dealer so busy paying him that he could not notice the alarming number of sixes and eights,” reported the Reno Evening Gazette (Oct. 1, 1910). “Time up, the Kid left $30 or $40 in bets on the table, substituted the square dice and crapped out immediately.”

He stealthily merged with the crowd and moved to and out the door. Next, he went to the Palace, but quickly left when the craps dealer saw him, as the two knew one another. To make his escape, Varner drove to the neighboring town of Sparks and caught the train out there.

1920: Taking It Overseas

By year-end 1910, all legal gambling in the U.S. had gone away and with it, opportunities for the Harmony Kid to earn money in the way at which he excelled. It appears as though he spent some years serving the country during World War I.

Afterward, in 1920, he went to Europe for the purpose of “commercial business,” as a “salesman,” according to his passport application. Most likely, the only selling he did there was of the lie he was an honest gambler.

There was no mention of him in American newspapers until his passing, in 1933, at which time he was back in the States, Chicago specifically.

Do you know anything about the Harmony Kid you could share?

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Photos: all from freeimages.com

Sources

Allen Smiley

Allen Smiley “was one of the most powerful gangsters in [California],” wrote author Gerald Horne in Class Struggle in Hollywood, 1930-1950. He was Benjamin “Bugsy” Siegel’s partner and best friend and subsequently, Johnny Rosselli’s* right-hand man.

Somewhat in the shadow of these famed men and a private person, his story is less well known. So It Really Happened! unearthed these 10 interesting snippets about him:

1) Allen Smiley, né Aaron Smehoff and also known as Abraham Smickoff, dropped out of school in Canada at age 12 and three years later, entered the United States alone, through Detroit. Born to Orthodox Jewish parents in in Kiev, Ukraine in 1907, he and his family had immigrated to the Great White North when he was seven.

2) Smiley was involved in gambling in various ways in several states. With Siegel, he operated the Transamerica Wire Service, which provided race information from the California tracks, and he helped Siegel get the Flamingo hotel-casino built in Las Vegas, Nevada.

Smiley organized gambling junkets at various locales, including the Garden of Allah in West Hollywood, California; The Knickerbocker in New York, New York; the Argyle Hotel in San Antonio, Texas; the Colony Club in Gardena, California; and the Rex gambling ship, off of the Southern California coast.

He was the ambassador of gambling relations, essentially a recruiter of high-rollers, for the Beverly Country Club in New Orleans, La.

As a player, he loved betting on and watching horse racing. “The race was the one clandestine addiction he couldn’t conceal,” wrote his daughter Luellen Smiley in her memoir Cradle of Crime.

3) Throughout his life, Smiley racked up numerous arrests, for bookmaking, running a wire service, transporting gambling cheating equipment, assault, suspicion of murder, robbery, extortion, operating without a liquor license, contempt of court and other crimes.

4) After Siegel’s murder in 1947, Smiley needed legitimate employment, as he faced possible deportation, having been indicted for falsely writing on an arrest form he was an American citizen. He asked Mob accountant Meyer Lansky if he could get back his $30,000 ($319,000 today) investment in the Flamingo, and Lansky consented. Smiley then invested the money in Texas oil exploration.

5) In 1949, at the Little Chapel in Las Vegas, he married Lucille Casey, a John Robert Powers agency model and a dancer at the Frank Costello-owned Copacabana nightclub in New York City. (The two divorced in 1962.)

6) After being convicted of falsely claiming citizenship, Smiley served nine months of a one-year sentence, from February to November 1951, at the McNeil Island Corrections Center in Washington state. He was paroled early for good behavior.

7) While imprisoned, he testified, somewhat belligerently and in handcuffs, before the Kefauver Committee.

8) Smiley contracted hepatitis B during adulthood. He’d told a confidant that he’d gotten it after being injected with blood from donors suspected of having the virus, at McNeil Island as part of medical research that used prisoners as subjects.** (We couldn’t verify that he’d been one of these test subjects but confirmed that such an experiment was done at that very penitentiary. The purpose was to determine if hepatitis B was or was not a blood-borne disease.)

9) Despite the federal government’s threats to deport Smiley to Canada or the U.S.S.R. upon his release from McNeil Island, Smiley was allowed to stay stateside and eventually become a U.S. citizen, which he did in 1966.

10) He died from hepatitis-induced cirrhosis of the liver. Near his life’s end, he chose to stop the antiviral treatment for hepatitis that he’d been on, knowing that as a result, his liver disease would worsen and cause his demise. He passed away at age 74 or 75 on March 6, 1982.

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* Johnny Rosselli was a Chicago Outfit member charged with ensuring smooth operations in Hollywood and Las Vegas.

** In the experiment, a total of 60 healthy, supposedly volunteer, prisoners at McNeil Island and at the U.S. Penitentiary, Lewisburg were injected. As a result, 27 of them contracted the virus; two at McNeil died not long after.

Sources

1950

In late 1948, Hollywood movie producer, Frank N. Seltzer — known for the movies, Jungle Patrol and Let’s Live Again, which debuted that same year — began research for his next project, 711 Ocean Drive, starring Edmond O’Brien and Joanne Dru.

He intended for it to expose the “bookie racket,” or “wire service as a new industry for the hoodlums who lost out through repeal” of Prohibition,” he said (Nevada State Journal, June 15, 1950).

He planned to film in a handful of California and Nevada cities. However, Lieutenant William “Bill” Burns, with the Los Angeles Police Department, warned Seltzer he was “walking into a bear trap” in Las Vegas.

In 1949, after the script was ready, someone from the public relations firm that represented the City of Las Vegas told Seltzer they could make available famous hotel-casinos on the Strip for filming. A separate hotel owner directly offered his property for the Sin City sequences. Further, a city councilman and Chamber of Commerce member assured the producer they’d cooperate fully with production.

Obstruction, Harassment Begin

Two months later, however, when production manager, Orville Fouse, went to Las Vegas, the hotel-casino owner who had offered his property for filming asked him to his office, where there were three “bruisers leaning against the wall,” Seltzer described. The hotelier told Fouse the trio believed making the movie would be “harmful to the best interests of the city.” The PR company also reneged. Seltzer’s cameramen were denied a rental car and city airport facility services and told to return to Los Angeles where they belonged.

A false rumor that Seltzer was working on a biopic of the late mobster, Benjamin “Bugsy” Siegel, spread around Sin City. The bogus story that Seltzer was filming for a story about mobster Mickey Cohen was perpetrated in Palm Springs.

“We are going to stop you in any way we can,” Las Vegas gamblers made clear to Seltzer.

“Frank didn’t realize what danger was in this flicker until some mobsters from Las Vegas threatened

to run him out of town — loaded with lead — when we went there on location,” O’Brien said (Lubbock Morning Avalanche, Aug. 17, 1950).

At that point, LAPD’s Burns assigned himself and four of his Gangster Squad men to escort Seltzer and the cast throughout filming.

Despite the warnings and obstructionism, Seltzer moved forward with his cinematic project as best he could. He and his production team were prevented from filming in Vegas, at Lake Mead and a well-known Los Angeles restaurant. He was nearly stopped from shooting in Palm Springs.

When attempts were made to block them from shooting scenes near Boulder Dam, Seltzer had his attorneys ask the Secretary of the Interior, Oscar L. Chapman, to intervene, which he did. Consequently, U.S. forest rangers were assigned to the crew, and filming took place but allegedly remained fraught with danger.

For instance, O’Brien, the movie’s leading man, recalled what really happened during the final sequence when his character, Eddie, was supposed to be shot with blanks by 20 riflemen during a chase through Boulder Dam, “After the take, I turned around and there were three bullet holes in a car windshield — about a foot from my head” (Lubbock Morning Avalanche, Aug. 17, 1950). “The cops cleared out all spectators including a few hoods in their midst. We had to do that scene over three more times — and, believe me, I ‘died’ each time.”

The International News Service reported, “As police know, 711 was in constant danger from hoodlums and was protected by a battery of police and plainclothesmen … 711 almost cost the lives of a few persons connected with it, including O’Brien’s.”

Seltzer presumed the gamblers’ main objection to his picture was that it revealed how past posting — faking odds and placing bets after races occurred — could beat the bookies.

Reactions Upon Movie Debut

Upon 711 Ocean Drive’s 1950 release, some critics claimed it fell short of being a hard-hitting, revelatory movie about the gambling industry. Instead, they said, it was a modest melodrama at best, “no more than an average crime picture with some colorful but vague details thrown in,” reported the Los Angeles Times (July 20, 1950).

Others lauded it for being the first to portray “the inside story of the infamous syndicate and its hoodlum empire, with its terror and violence,” and “forcefully reveal[ing] the many facets of the bookmaking business which takes millions of dollars daily from thousands of small bettors: housewives, mechanics, office workers, students,” according to Utah’s Salt Lake Tribune (July 31, 1950).

Sources

1948-1950

In between dispatch orders, a Las Vegas, Nevada taxi driver fleetingly picked up the announcement of horse racing information on his cab radio one day in mid-October, 1948.

He informed Clark County Sheriff Glen Jones, who contacted the Federal Communications Commission (FCC) in Los Angeles. The agency immediately sent to Sin City two radio engineers — Robert Stratton and Raymond Day — to investigate.

Illegal Activity Uncovered

Their testing revealed that the broadcasts had taken place between 10:30 a.m. and 6:30 p.m. daily and had originated from equipment in Room 228 of Vegas’ Apache Hotel on Fremont Street.

The guest register showed a Charles Stauffer, 28, residing there.

Stratton, Day and Jones raided the space, discovering a rigged system for hijacking horse racing information — odds, entries, results and parimutuel payoffs.  Through a hole cut in the Apache room’s floor, which opened into an air duct that traversed the El Dorado Club’s ceiling, a microphone picked up the race details announced via loud speakers at that casino.

It fed the sound into a transmitter which then sent it to a receiver in the Santa Anita Turf Club, 60 yards away, across the street.

The stolen data originated from Chicago-based Continental Press Service, which collected them from the horse racing tracks and distributed them nationally via leased Western Union facilities. However, three men controlled distribution of that information in Las Vegas — Moe Sedway, Morris Rosen and Cornelius Hurley.

(Sedway owned the El Dorado Club. He and Morris Rosen owned the Golden Nugget horse race wire service. Both were mobsters associated with Meyer Lansky and Benjamin “Bugsy” Siegel. Hurley was Continental’s Las Vegas manager.)

Hurley provided exclusive access to the race wire to Sedway and Rosen, who in turn sold the service only to select casinos in town. The Turf Club wasn’t one of them. In, fact, for unknown reasons, they’d turned down the owners — Ed Margolis and Sam and Dave Stearns — when they’d applied previously, leading to them tapping the wire.

Five suspects were arrested for the crime: The three Turf Club owners along with the man they hired to install the equipment at the Apache, John Melvin Cole, 26, and Stauffer, 28.

Attempted Double-Double Cross

Stauffer, who was in Nevada for a divorce, had been offered a fully comped room if he’d turn a transmitter on and off at two designated times per day. He’d agreed.

However, he’d figured out what was transpiring and tried to capitalize on that knowledge for added benefit. He’d told Hurley that for $6,000 he’d disclose where the “bootleg” transmitter was located.

Hurley had negotiated the price down to $4,000, but no deal had been finalized when the cab driver set the subsequent events in motion.

Wire Tapping Consequences

A federal grand jury indicted Cole, Margolis and the Stearnses in mid-1949 for violating the Communications Act of 1934, a felony. They were released on $1,000 bond apiece.

In federal court in February 1950, the men’s defense attorney asked for suppression of the evidence against them for two reasons:

The search warrant that law enforcement had used to get into the Apache Hotel room was illegal as it hadn’t been directed at any one person and that a deputy sheriff, rather than a requisite U.S. marshal, had served the warrant.

• Because Cole was illiterate, he couldn’t have written the confession presented.

• The judge granted both motions and dismissed the grand jury indictments against all four.

Cole was released, but the Stearnses and Margolis were charged with violating FCC regulations governing low-power radio stations, a misdemeanor. They all pled guilty and, ultimately, paid $1,200 apiece in fines.

As for Stauffer, he was charged with operating a radio station without a license, a felony with a maximum penalty of $10,000 and two years in federal prison. It’s unknown what sentence he received, if any.

Sources

1941

In an override of Governor Edward Carville’s veto, Nevada legislators legalized bookmaking.

The law explained that “the receiving of bets or wagers on horse races held without the state of Nevada shall be deemed to be a gambling game,” thereby making it permissible for those with a gambling license to take such bets on such events.

Mexico’s Monte Carlo and Sunset Inn

1913-1929

With various state bans on gambling and, later, a nationwide prohibition against liquor, many Americans, particularly wealthy Southern Californians, traveled to casinos in Mexican border cities to play and imbibe.

“The great hegira* is in, and already these towns are filled to the limit with throngs of the thirsty, willing to pay big sums for the pleasures banned by law on American soil,” reported the Reno Evening Gazette (March 30, 1920).

Here are some casinos that lured U.S. citizens across the border to do what they legally couldn’t at home:

In Calexico

• Owl (Tecolote) Café and Theatre: Large but unadorned, “an immense barn-like structure,” the Owl boasted nearly 40 tables for keno, faro and poker along with many roulette wheels (The Bakersfield Californian, Feb. 10, 1920). Advertisements for the gaming resort touted: “Both night and day, across the way, you will never find closed, the Owl Café.” Three Bakersfield, California, saloon and brothel owners — Marvin Allen, Frank Beyer and Carl Withington — or ABC Corp., opened the Owl around 1913. Seven years later, a fire that raged for three hours burned it down.

“The destruction of the Owl leaves one large gambling house in Mexicali, a Chinese establishment where many of the games are beyond the ken** of the average American,” reported The Bakersfield Californian (Feb. 10, 1920).

In Mexicali

• Casino de Mexicali: Following the conflagration of the Owl, Governor Esteban Cantu of Baja, California, built and oversaw in his capital city the upscale Casino de Mexicali, which also was open 24/7. Luxuriously appointed, the entire top floor was divided into suites equipped with games for wagering. Cantu charged customers an initial $250 membership tax (about $2,950 today) and a $20 monthly fee. In the first month alone, 2,000 people had joined. In its early days, the Casino de Mexicali drew about 25,000 to 30,000 Americans per day.

“The project stood Cantu an even million dollars before a wheel turned,” noted the Reno Evening Gazette (March 30, 1920).

In Tijuana

• Feria Típica: This traditional fair, the brainchild of Antonio Elosúa, offered gambling in the forms of cockfighting, bullfighting, bull baiting and horse racing along with folk dancing and Mexican food and drink. It debuted in 1915 with the slogan: “Where Everything Goes and Where Everyone Goes.”
• Monte Carlo: Elosúa opened this casino the following year. Adjacent to the Feria Típica’s open-air arena, it offered cards and dice table games, slot machines and roulette wheels. By 1917, ABC Corp. had bought out all of Elosúa’s holdings.
• Sunset Inn: ABC Corp. and Jim Coffroth built in 1920 this new $1 million casino with a balcony that overlooked the racetrack. The proprietors added to the casino’s events schedule many of the feria’s most popular exhibitions, like bullfighting.

“To lure and keep gamblers on the property, the new Monte Carlo served decent enough 75-cent meals and the dance hall stayed open all night,” wrote Lawrence D. Taylor (San Diego Historical Society Quarterly, Summer 2002).

• Agua Caliente Casino and Hotel: Another trio of Americans — Wirt G. Bowman, Baron Long and James N. Crofton — built this ornate, $10 million, Spanish-style resort that boasted a casino offering faro, roulette and baccarat, horse and greyhound racing among other recreational amenities. Four-person bungalows allowed for gambling in private. Located six miles south of the border near the hot spring, the property opened in two phases, in 1928 and 1929. During its heyday, Agua Caliente attracted a slew of tourists, among them famous Hollywood stars.

“American cupidity has enriched the gamblers of Augua [sic] Caliente more than $4 million in the past 10 months. The Old West in its heyday never saw such gambling as is being done at Augua Caliente these days,” reported The Kokomo Tribune (June 7, 1929).

The end of Prohibition curtailed the throngs of U.S. citizens visiting Mexico for pleasures.

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*A flight or journey to a more desirable or congenial place
**Understanding or knowledge

Sources

1944-1945

In the final year of World War II, three related mandates hampered Nevada’s gambling clubs, but, in general, casinos willingly withstood the hits out of a sense of patriotic duty.

These directives, imposed by the United States’ war mobilization agency, followed a national call for roughly 200,000 more “able-bodied men, willing to do hard work” between the ages of 17 and 35 (Nevada State Journal, Nov. 21, 1944). The requirements, listed chronologically, were:

• In January, all horse and dog racing in the country was to stop immediately, which it did. The federal government initiated this to combat absenteeism, as much as 30 percent, at war plants located near the racetracks.

The casinos offering betting on these sports suffered a decrease in business. Whereas customers no longer could place bets on races at U.S. places like Pimlico, Jamaica, Belmont and Narragansett, they still could get some action at certain local casinos that subscribed to a race track wire service that covered races held in Mexico and Cuba.

• In early February, more than 300 of Nevada’s gambling dealers, bartenders and other non-essential workers were to begin working at plants and industries in Nevada and on the West Coast, which were crucial to the war effort. Consequently, casinos lost key personnel.

• All U.S. entertainment spots were to close at midnight starting on Feb. 26. They included gambling enterprises, bars, night clubs, theaters, sports arenas, dance halls, roadhouses, saloons, bars and the like, public and private. Restaurants that served food only (no alcohol) were exempted. Affected businesses could reopen at 8 a.m.

“The action is the most drastic of its kind yet promulgated in Washington during the present war,” noted the Nevada State Journal (Feb. 20, 1945).

The reason for the midnight closing was to conserve coal, manpower and transportation and help boost morale of active military service members, all of whom had been prohibited from entering or being in those places after midnight. It also was to help reduce the rate of civilian workers employed in critical industries not showing up to work.

Not only did Nevada’s casinos experience a drop in business, but, also, those open around the clock had to lay off their graveyard shift workers.

Relief From The Dictates

The Germans surrendered on May 8, 1945. The following day, the U.S. director of war mobilization immediately abolished the midnight curfew and the ban on horse and dog racing.

Sources

Photo from pond5.com: “American Flag Background” by ozaiachin

Einstoss

1939-1941

Bernard “Bernie” Einstoss was a well-known gambler in Northern Nevada for nearly two decades, between 1947 and 1965.* Prior to that, he masterminded and executed a scheme to fix horse races** in California by bribing and threatening jockeys to “pull” the horses they commandeered, or keep them from winning.

Einstoss went by the name Barney Mooney and introduced himself to people as Mooney.** He earned the nickname “Big Mooney,” wrote John Christgau, “because he liked to sweep into fancy nightclubs and set up the house with drinks — especially champagne, if he was flush from a big winning bet” (The Gambler and The Bug Boy). Einstoss began placing bets in grade school on marbles and chocolates and by high school, which he dropped out of, had progressed to wagering on prize fights, horse racing, baseball and more.

How It Worked

Einstoss, 27, with the help of some accomplices, launched his race fixing scheme with the season’s start in 1939 in Southern California, where he ran a suite of bookmaking rooms in Los Angeles with fellow gamblers, Benjamin Chapman and I.W. “Doc Kebo” Kivel.

The three spread tips around Hollywood movie lots that specific horses were sure to win in certain races, and they’d take the bets on them. Specific targets were high rollers like George Raft and Don Ameche. Then Einstoss would have the jockeys riding those horses deliberately lose the races. The trio profited from the betters’ (or suckers’) losses, assuredly and amply.

Manipulation Of Jockeys

Einstoss had intermediaries recruit and pay jockeys who could be bribed, typically those who were young, under age 20 for instance, vulnerable and desperate for money. Based on handicapping percentages, Einstoss determined which horses he wanted to lose and got word to the corresponding jockeys to “pull” them, sometimes multiple horses for one jockey in a day. Einstoss paid the riders $200 (about $3,500 today) per favorite and $100 ($1,700 today) per longshot horse they pulled and paid the go-betweens $200 per jockey they turned.

Einstoss had thrashed a jockey who hadn’t done what he’d asked, and most expressed a fear of him and belief that he’d kill them if provoked. In at least one instance, when a jockey failed to lose a race because he couldn’t physically restrain the horse, Einstoss told him, “You cost me $30,000! Thirty-thousand dollars! I’ve thrown boys in the ocean for less” (The Gambler and The Bug Boy). (This is equivalent to about $532,000 today.)

“These boys, I feel sorry for personally because I believe that they are just young kids, that is all, and they are not mature. They have not the state of mind to think things out … and they are tempted with easy money … far more than they ever saw before in their lives,” Jerry Giesler, chairman of the California Horse Racing Board, said at a hearing where numerous jockeys were compelled to tell what they knew about the race fixing.

Perpetrators Caught, Plot Halted

In November 1940, following an investigation, Einstoss was arrested and, eventually, so were his partners in crime. They were his brother, gopher and bet taker, Jack Einstoss; gamblers Chapman and Kivel; and two middlemen, Saul “Sonny” Greenberg, a horse trainer, and James Joseph Murphy, real name Irving Sangbusch, a race track follower.

Because fixing races wasn’t illegal (yet) in California, the group was charged with conspiracy and contributing to the delinquency of minors (the jockeys).

The Prosecution’s Case

At the trial, which began on February 28, 1941, the State of California argued that the defendants ran bookmaking establishments and through control of jockeys, altered the outcomes of races on which they’d accepted wagers and themselves had bet at the tracks. Prosecutors alleged that the group had fixed more than 100 races at various tracks — Hollywood Park, Del Mar, Bay Meadows and Tanforan — yielding an estimated $1 million (about $17.7 million today).

Sangbusch/Murphy testified for the state in exchange for removal of the charges against him. He explained that Reno, Nevada mobster and illegal gambler William “Bill/Curly” Graham had suggested to him that he contact Einstoss and had furnished the phone number. Sangbusch followed through, and the next day met with Einstoss, Kivel, Chapman and others at the bookies’ Hollywood headquarters, where they discussed the race fixing strategy. Subsequently, Sangbusch began working as an intermediary for the group. He admitted to having distributed about $20,000 ($355,000 today) in bribes from Einstoss to certain jockeys.

Defense: Gambler With Scruples

When Einstoss, free on $3,000 bail, took the stand, he claimed he made money by gambling on odds as opposed to race fixing through bribing jockeys. His attorney, Paul McCormick, argued that Einstoss was “always an honest gambler” (Los Angeles Times, May 3, 1941) yet admitted that Einstoss had given money to the jockeys and had known the jockeys, of their own accord, likely were going to pull their horses.

“But the facts are that the jockeys approached Einstoss,” not the other way around, McCormick added. “They were touting him to bet on certain horses and he paid them money for their tips. It is very probable that they might have pulled those horses to make their tips good and therefore collect more money.”

During final arguments, Einstoss “burst into tears,” got up, left the courtroom, went into an adjoining room, sat and sobbed (Nevada State Journal, May 16, 1941).

The End Result

After two months of testimony, at May’s end, the jury found Einstoss guilty on four misdemeanor counts of contributing to the delinquency of minors but not on the conspiracy charge. The judge ordered he serve a year in county jail and pay a $1,000 ($17,000 today) fine. The convicted man did both.

Subsequently, Einstoss moved to Reno, Nevada. Over the ensuing decades, he co-owned and had some involvement in the casino operations at the Mapes and Riverside hotels and the Horseshoe Club in Reno, along with the Bal Tabarin at Lake Tahoe in Crystal Bay. He had a smaller, nonoperational ownership in Caesars Palace in Las Vegas.

Most of the jockeys who participated in the plot were suspended indefinitely from horse racing in California.

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* Bernard Einstoss died in 1966 at age 53 in Southern California.
** Horse racing under the parimutuel wagering system has been legal in The Golden State since 1933.
*** The name “Mooney” comes from the Gaelic word “maoin,” which translates into “wealthy” or “descendant of the wealthy one.”

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Illinois Club, circa 1900

1860s to 1960s

“The loose buckle in the Bible Belt” and “Las Vegas before Las Vegas had water” — these were Hot Springs, as described in the press (Hot Springs, 2013).

This Central Arkansas city boasted illegal, yet wide-open, gambling for about a century, from the late 1860s until the late 1960s, making it the only United States locale with such a history. That run was interrupted three times: around the start of the 20th century, immediately preceding the onset of World War I and between roughly 1946 and 1948.

They heyday of Hot Springs gambling was from 1927 to 1947, during which more than 10 major and many small casinos existed. In 1931, for example, this home of 16,000 people welcomed roughly 15 times as many visitors.

Hot Spot For Gambling, Fun

Hot Springs was hugely popular among the notorious, wealthy and famous. “Millions of people visited the spa city to gamble” despite its remoteness, wrote Robert Raines in Hot Springs.

Along with games of chance and horse races, the recreation destination offered opportunities to soak in hot baths (the city’s name came from its abundant geothermal springs); drink, even during Prohibition, particularly the revered, locally distilled moonshine; golf; watch Major League Baseball spring training games; and use brothel services.

The notorious visitors to this city included a who’s who list of mobsters, most of whom were involved in gambling, and other, enterprises elsewhere. Among them were Joe Adonis, Jimmy “Blue Eyes” Alo, Albert Anastasia, Al “Scarface” Capone (who had his armored 1928 Cadillac shipped there by rail from Chicago to use while vacationing), his brother Ralph Capone, Mickey Cohen, Frank Costello, Sam “Momo” Giancana, Meyer Lansky, Charles “Lucky” Luciano, Owney “The Killer” Madden (who retired in Hot Springs), Bugs Moran, Frank Nitti and Benjamin “Bugsy” Siegel, along with New York and Chicago policy kings Ellsworth “Bumpy” Johnson, Ted Roe, and brothers Edward, George and McKissack Jones. For these men, Hot Springs was a sanctuary of sorts, a place to get away from the stressors and dangers of organized crime, be left alone by rivals and law enforcement and enjoy a true vacation.

The gangsters who flocked to Hot Springs to hide and, sometimes, plan their next crime, many of whom were on the FBI’s Most Wanted list at some point, included Bonnie and Clyde (Bonnie Elizabeth Parker and Clyde Chestnut Barrow), Harvey Bailey, the Barker Gang members, John Dillinger, Charles “Pretty Boy” Floyd, Alvin Karpis, Frank “Jelly” Nash (who was actually arrested by federal agents in the White Front Club there) and George “Baby Face” Nelson.

The influx of mostly law-abiding visitors included Hollywood stars, celebrity athletes, business magnates and politicians. Some of them were: Elizabeth Taylor, Marilyn Monroe, Rudolph Valentino, Jack Dempsey, Rocky Marciano, Babe Ruth, Andrew Carnegie, F.W. Woolworth, Franklin Roosevelt, Harry Truman, Ronald Reagan and John F. Kennedy. Big-name games of chance players, like Nick “The Greek” Dandalos, Amarillo Slim, Murph Harold, Lester “Benny” Binion and Titanic Thompson, also frequented Hot Springs. 

The Gambling Milieu

Primarily locals controlled the gambling, although a few ex-Arkansas mobsters owned interests in some of the enterprises over the years. William “W.S.” or “Bill” Jacobs from Memphis, Tennessee, who owned six clubs there, is recognized as the first gaming impresario of Hot Springs. After Jacobs died, gaming insiders asked New York mobster Frank Costello to take over, but he declined.  Instead, Jack McJunkins succeeded him, and later, H. Dane Harris assumed the role.

Once Owney “The Killer” Madden permanently moved to Hot Springs in 1935, he kept an eye on gambling and ran his own bookmaking/wire service there until his death in 1965. When Sam “Momo” Giancana inquired about buying a piece of the gambling action in the 1960s, he was turned down.

Over the decades, the major places to gamble and the years they opened (when known), included the:

Arkansas Club, Indiana Club, Illinois Club, Kentucky Club, Bridge Club, Arlington Hotel (1874), Southern Club (1893), Ohio Club (1903), Oaklawn Park Race Track (1905), Belvedere Club (1929) and Vapors (1960).

By 1964, only the Southern Club, Vapors and the Arlington Hotel remained as the large gambling spots, along with the race track.

Oaklawn Park Race Track

Despite gambling being illegal, the city charged such operations a tax, the amount depending on their size. When the city needed money, the gambling heads were expected to pay more, which they willingly did to keep running their establishments freely.

Gambling Gets Wiped Out … Mostly

The end of gambling in Hot Springs began with the election of Winthrop Rockefeller (R.), a grandson of John D. Rockefeller, Sr., as the Arkansas governor in 1967. While campaigning, he indicated he’d support a pro-gambling amendment should legislators pass one.

That they did when Rockefeller got into office, but he vetoed the bill. Later that year, he had all gambling eradicated in the city except for horse and dog racing.

For the next 40 years, the Oaklawn Park Race Track was the only legal gambling spot in Hot Springs. That changed in 2005, however, with passage of the state’s Local Option Horse Racing and Greyhound Racing Electronic Games of Skill Act, which allows race tracks to offer some electronic, casino-style games. (This has earned them the moniker “racinos.”) Excluding these racino offerings, gambling remains illegal in Arkansas.

Photo of Illinois Club, restored by Steve Sloan

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