In its July 1966 raid of Kress Manufacturing Co. in Tulsa, Oklahoma, Federal Bureau of Investigation (FBI) agents seized a treasure trove of crooked gambling equipment that seemed headed to various Nevada casinos.

The haul included “hundreds of decks of marked cards and hundreds of pounds of crooked dice” (Nevada State Journal, July 27, 1966). The latter contained stamped logos of various major casinos in Las Vegas, Reno, Lake Tahoe and Elko along with smaller clubs throughout The Silver State. They included the:

Dunes — Las Vegas
Louisiana Club — Las Vegas
New Frontier — Las Vegas
Stardust — Las Vegas
Golden Bank — Reno
Riverside Hotel — Reno
Commercial Hotel — Elko
Crumley Hotel — Elko
El Bo Room — Wells
Cal-Neva Lodge – Crystal Bay (Lake Tahoe)

Agents also confiscated various other implements used to cheat at gambling. Among them were metal filings and discs used to weight dice; arm mirror manipulators and glasses used to read marked cards; holdout devices to secret away a desirable card for later use; magnets and magnetic coils used to control dice when rolled; and switches and relays used in rigging equipment like roulette wheels.

The search also turned up Kress invoices that showed the Tulsa gaming equipment manufacturer shipped its products to establishments throughout the U.S. Recipients included the Stardust and Riviera hotel-casinos in Las Vegas and the Citizens Club in Hot Springs, Arkansas.

Casinos Deny Wrongdoing

As soon as the news of the search and seizure went public, proponents of Nevada gambling reacted.

Officials from the Riviera, Stardust, Louisiana Club, Riverside, Dunes and the Commercial Hotel all publicly denied using any kind of cheating device. They never ordered gambling equipment from Kress Manufacturing, they said. In fact, they never heard of it.

“I never knew [Kress] existed until right now. This comes to me out of the clear blue sky,” said James Lloyd, president of Riverside Hotel Inc. However, he continued, “This happens lots of times. Some of these companies make crooked equipment to sell to crossroaders who try to cheat the house.”

State Agency Weighs In

Edward “Ed” Olsen, chairman of the Nevada Gaming Control Board (NGCB), the state’s gambling investigative arm, publicly made four points.

1) This happened before (which was true) and, thus, there is no cause for alarm. 

2) History shows that such cheating paraphernalia is not for Nevada casinos to swindle their customers with but, instead, it’s for individual career cheaters, or crossroaders, to use to cheat the gambling houses

3) To err on the side of caution, though, the NGCB will look into whether or not any of the state’s casinos ordered rigged equipment, but sending gaming agents to Tulsa isn’t necessary.

4) The Golden Bank Club, the El Bo Room and Crumley Hotel, the logos of which were on some of the found dice, no longer offer gambling or are out of business (this was true). The El Bo has been closed for 10 years.

Newspapers Take Side

When the Las Vegas Sun reported the news of the found cache of illegal gambling devices, it used the biased headline, “Foil Plot to Cheat Casinos.” It explained what that meant with a slanted lead, or opening line: “A national plot to cheat top casinos throughout Nevada was uncovered yesterday by the FBI in Tulsa, Okla.” (July 27, 1966).

Reno’s Nevada State Journal published an op-ed piece that refuted any possible merit to the notion some Nevada casinos cheated their customers. It read: “The gamblers and the state gaming officials know that the Tulsa dice were intended for use against the Nevada casinos. So, from a standpoint of the casinos being innocent of buying cheating gambling devices, there is no question. They just simply don’t do it” (July 18, 1966).

“Anyone who knows anything about gambling, however, knows immediately that the implication that the bigger Nevada gambling houses may be buying crooked dice or cards to cheat their patrons is just plain ridiculous,” the writer went on. “That the casinos, and particularly the big casinos, would risk, their licenses, representing millions of dollars in investment, by using crooked playing equipment is beyond comprehension.”

Also, the writer called out the FBI for intentionally misleading the public to think, by not saying otherwise in its report of the Kress raid, that the crooked equipment was intended for casinos not crossroaders.

An Opposing View

Op-ed writer Paul Harvey for The Ada Evening News in Oklahoma purported that Nevada’s gambling industry wasn’t as squeaky clean as it wanted the country to believe. In a published piece titled “No Gamble,” he wrote:

“Las Vegas is not going to incriminate itself. We are going to learn nothing new from this recent self-investigation. A hearing where the bosses are not subpoenaed and the witnesses are not under oath and the sessions are secret could hardly be anything but a whitewash. Accusers say the games are rigged and the cream is skimmed by the underworld before the casinos compute their taxable income, but you can hardly expect the State Gaming Commission to indict itself.

“We’d all heard the naive say, “Mathematical odds on cards, craps and roulette favor the house: they don’t have to cheat!’ Now the FBI has shown us that they do anyway. But the swindle goes on and the suckers stand in line and the casinos continue their business as usual” (Sept. 13, 1966).

Next week in Part II, read about the gambling investigation that led to the Kress raid, the indictment of 15 people including a Las Vegas-based dice maker and the legal outcomes for the key players.

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Louisiana Club chip photo: from the Museum of Gaming History’s Chip Guide

Sources

Reno Joe in the Mapes lobby

1950-1956

A novel, animated gambling device began to appear in Nevada casinos in 1950. It debuted in the lobby of Reno’s Mapes hotel-casino in the fall and “got a big play from visiting Shriners,” reported the Nevada State Journal (Nov. 12, 1950).

They were one-armed bandits, or life-sized outlaws whose torso was a slot machine and whose arm and gun-toting hand constituted the lever.

Donning a white plastic cowboy hat, a red bandanna over their lower face, jeans and boots, the men’s eyes lit up in red when a player got a payout. In some models, they shouted “jackpot” when the bars aligned horizontally. The Mapes’ version garnered the name “Reno Joe.” 

The showcasing of Reno Joe resulted in numerous calls from Silver State casinos to the manufacturer for large orders of the Bandit. However, because Character Manufacturing Co. (CMC), on South Virginia Street in Reno, hand carved and custom made each one with individual characteristics, it only produced them in limited numbers. The brand of slot machines it used in them also differed occasionally but typically was a Mills or a Pace.

A Popular Novelty

In 1951, the Nevada Club in Reno installed in its bar area four Bandits, ones wearing hatbands bearing the casino name. They held Jennings Standard Chief slot machines, at the request of Lincoln Fitzgerald, the club’s co-owner and gaming manager.

The same year, LIFE magazine published in its May 18 issue a photo of the five Bandits in Stockmen’s Hotel and casino in Elko, in Northeastern Nevada. Those boasted gray and white polka-dot bandannas and red slot machines.

To entice people to play the slots, the Las Vegas Club in Southern Nevada, in 1952, commissioned 15 Bandits for its casino. They were beefier and better resembled men than Reno Joe, and had two arms and patterned shirtsleeves. Some lacked the bandanna.

These slots became the club’s icon, getting face time on advertising matchbooks and decal-postcards. The message on the latter was to see for oneself “the 15 generous gentlemen of the Old West at the Las Vegas Club.”

Other casinos, too, including Vegas’ Mint, purchased and incorporated the Bandit into its gambling offerings.

Artists And Products

Character Manufacturing Co. (CMC) began in 1948. During that time, various individuals carved its products.  One of the first was Sundance Cravat, a well-known Reno cowboy skilled in various handcrafts, including wood carving.

CMC hired cowboy artist Frank Polk when he claimed he could do a better job than had been done. During 1951 and 1952, Polk crafted more than 90 pieces for the company.

Other slot machine figures CMC made were the Gold Miner and the Cocktail Waitress, which was plastic. The latter was noteworthy for various wigs and apparel each of them wore. Reno’s Golden casino added 21 Cocktail Waitresses in 1956. They nearly met their demise during the fire ten years later that razed the building but were saved.

(CMC’s slot-less products included oversized, hand-carved Native Americans and talking horses.)

Sources

The main street in Elko, Nevada, 1940

1934

After hiding somewhere in the building, a person robbed the Bank Club casino’s safe of $500 in silver change (about $9,000 today) between 4 and 6 p.m. on a Wednesday in early December.

This particular Bank Club — a common name for Nevada gambling houses — was located in the town of Elko. The money belonged to Phil Heidt, who ran the club’s gaming.

Photo: by Arthur Rothstein

Commercial Hotel, Elko, Nevada in the 1920s

1925

Newton “Newt” Crumley, Sr., Goldfield, Nevada resident, met with William Doyle in September to discuss purchasing from him the Commercial Hotel in Elko, but they couldn’t agree on a price. Doyle wanted $5,000 more than what Crumley wanted to pay. No deal was done.

A month later, they reconnoitered and, still haggling, flipped a coin over the difference.

It’s unknown who won the toss, but Crumley bought the property for $70,000 (about $960,000 today).

Cactus Pete’s casino in Jackpot, Nevada in 1960

1960

When one rural Nevada town grew into a gambling hot spot in the mid-1900s, the gamblers in another loudly grumbled.

Soon after Idaho outlawed slot machines, its last vestige of legal gambling, the sagebrush- and broomgrass-covered land 47 miles south of Twin Falls, just across the border, began to evolve into a small community — Jackpot. It grew to consist of about 125 trailers (no houses), two motels, a grocery store and a beauty shop.

Development started in 1954 with the debut of the Horshu Club. The 93, Cactus Pete’s, Tex’s Gateway and Diamond Jim’s then followed. Together, these casinos offered 320 slot machines, four pits of 21, roulette and dice tables, keno and wheels of fortune along with free meals and stage entertainment.

By 1960, the town’s five gambling houses drew thousands of players per year,* many from nearby Idaho Falls. To capitalize on that city’s pool of players, Jackpot’s gamblers provided free nightly, round-trip transportation by bus.

Gamblers Protest About, Well, Other Gamblers

Rival casino owners in Elko, which officially became a city in 1917, claimed the Jackpot clubs were exploiting Twin Falls’ economy. They predicted law enforcement and public service problems would arise in Jackpot and warned the end result would be Twin Falls business owners lobbying for a federal gambling ban.

“Frankly, the Elko gamblers don’t like the competition — they are 115 miles farther from the Idaho line,” wrote the Oakland Tribune (Nov. 13, 1960).

The state’s gaming regulators noted the complaints and thought they might be valid in part. They wondered if casinos in the rural border regions might harm the industry overall, particularly because those places were difficult for them to oversee and because of the payoff scandal involving a gambling watchdog in the rural town of Wells that had occurred earlier in the decade.

The Nevada Gaming Control Board launched an investigation, and in November 1960, conducted a survey of Twin Falls residents about their attitude toward gambling in Jackpot. It revealed that 18 percent favored it, 30 percent opposed it and 53 percent were neutral.

Were Nevada’s gaming agencies to forbid gambling in Jackpot, it would set a dangerous precedent, said the attorney for the community, Leo Puccinelli.

“Nevada gambling was built by competition and it will be in trouble if the established clubs can win monopolies with legislation,” he added. “After all, the major part of Nevada gambling is on a border basis. Only Elko is in central Nevada, while Reno and Lake Tahoe cater to Northern California and Las Vegas to Southern California” (Oakland Tribune, Sept. 16, 1960).

Jackpot’s gamblers remained mum on the issue, hoping it would go away … which eventually it did, leaving them to continue running their casinos without impediment by the state.

*Total gaming revenue from Elko County, including Elko and Jackpot, then was between $4 and $5 million ($32.5 and $40.7 million today) per year.

Sources

1966

Suddenly, in the fall, the Nevada Gaming Commission (NGC) directed 41-plus casinos to cease operation of specific electronic blackjack machines because they were “experiencing difficulties when played so as to render the devices more liable to win or lose” (Nevada State Journal, Oct. 21, 1966).

These 101 devices, available in gambling rooms in Las Vegas, Reno, Lake Tahoe, Carson City, Elko, Wells and Hawthorne and manufactured by Nevada Electronics, Inc., played like a slot machine with no dealer and were popular.

Because the NGC wouldn’t say more, mystery surrounded the issue. All, however, was revealed shortly.

Sneaky Tricks

It turned out these particular blackjack machines disfavored the player more than the hand-dealt version. This was because these electronic versions removed a card worth 10 points from the deck in play. This trick results in fewer blackjacks and boosts the casino’s edge by about half a percent, which doesn’t sound significant but is.

“Removing 10-value cards from play, whether by design of the game or by malfunction, requires some powerful, positive rules to make up for the impact it has on the odds of the game. If there really are 10-value cards missing from a deck in a regular blackjack game, you don’t want to play,” said gaming expert, John Grochowski (grochowski.casinocitytimes.com, Oct. 26, 2010).

Signs on the devices identified them as automatic blackjack games, thereby deceiving players into thinking they offered odds that were equivalent to games with a human dealer — which some blackjack machines actually did.

The suspect ones, however, did disclose, at the bottom of the game’s instructions, the 10-value card removal.

To satisfy the NGC, the distributor of the machines eliminated the automatic blackjack demarcation and replaced the instruction plates with ones where the card removal warning appeared at the top.

Once that was completed, about a month later, the gambling regulatory agency lifted the suspension.

Sources

1941

Nevada casinos are known for their big-name entertainment, and it all started in the city of Elko.

In spring 1941, Newton Crumley, the owner of the Commercial Hotel and its Monte Carlo Casino, engaged Ted Lewis, bandleader / singer / entertainer / popular radio star, to perform there for a week for $12,000 (about $196,000 today). Other stars who followed included Sophie Tucker, Lawrence Welk, Chico Marx, The Andrews Sisters and Paul Whiteman.

Photo from The New York Public Library Digital Collections, Billy Rose Theatre Division: Ted Lewis Act

1954

Late on a Saturday night in 1954, during the peak of business, an unemployed, 27-year-old railroad hand entered the Stockmen’s Hotel, in Elko, Nevada, where townspeople, miners, ranchers and tourists congregated to socialize, drink and gamble.

Silvus Armandus approached the casino cashier’s cage and demanded: “Hand over your money and don’t make a sound.”

The pit boss, D.E. Pierce, asked him to repeat what he’d said, and he did, gesturing with one of his hands in his pocket that he had a gun. Pierce, who thought Armandus was joking, began walking away. Armandus yelled, “I’ll kill the [expletive*],” while shooting at him twice, both bullets missing Pierce.

Another casino employee, Jack Brady, tackled the scoundrel to the ground and while wrestling with him, the gun fired two more times, injuring Brady in the stomach. Other employees joined the fracas, creating a body pile. When all the staff members stood, Armandus remained on the floor, unconscious.

During the melee, most of the casino’s 100 patrons just kept gambling.

Armandus was jailed for assault with a deadly weapon. When he subsequently appeared in court, the revised charge was attempted robbery. He pled guilty and said he couldn’t remember the incident at all. The judge sentenced him to 2.5 to 5 years in the Nevada State Prison.

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* The expletive wasn’t printed in the original newspaper source

Sources