Gangsters > Meyer Lansky

Meyer Lansky

Background

Early Life

Meyer Lansky, nicknamed "The Brain" was originally born as Meyer Suchowlansky in Grodno, Russia. This family was in the process of experienced Jewish pogroms (organized massacres) and in 1911 his family came to the United States from Odessa. His father had already come to the United States in 1909 and Lansky and his family joined him in the Lower East Side of Manhattan along with most of the immigrants coming over at the time.

When he was a teenager Lansky became good friends with Benjamin Siegel who would be his lifelong business partner in the bootlegging and eventually the burgeoning National Crime Syndicate along with Charles Luciano. Meyer Lansky was essential in helping Luciano organize the end of the Castellammarese War and the murders of the Mustache Petes, Maranzano and Masseria.

Bugs & Meyer Mob

Prohibition

Meyer Lansky and the Lansky and Bugs Mob was partnered with Arnold Rothstein for the beginning stages of Prohibition, however when Arnold prematurely died in 1928 Lansky was forced to ride the tide with Luciano.

During Prohibition the Bugs and Meyer Mob served as enforcers along with Charlie Luciano for the Big Seven. The Big Seven included Arnold Rothstein, Enoch Johnson, Johnny Torrio, Waxey Gordon.

As a youngster, Siegel saved Lansky's life several times, a fact which Lansky always appreciated. The two adroitly managed the Bugs and Meyer Mob with its reputation as one of the most violent Prohibition gangs.Lansky was the brother of Jacob "Jake" Lansky, who in 1959 was the manager of the Nacional Hotel in Havana, Cuba.Lansky operated on the highest bootlegging level during Prohibition and helped in forming the Commission in 1931. In later years he was active in the hotel and casino world as a main investor for the Mafia in cities as Las Vegas, Miami and Havana.Meyer Lansky was born in the city of Grodno (in modern day Belarus) as Majer Suchowlinski. His family emigrated to the United States in 1911 where they settled in the Lower East Side of Manhattan. While Lansky was a child and often wandered in the streets he met with Bugsy Siegel. At a young age both often held dice games with other youngsters earning their first bits of cash.However, older boys who declared the street was theirs meant trouble in which Siegel stood up for Lansky on numerous occasion. One of the older boys they encountered was the Sicilian born Lucky Luciano.Noticing the courage of the small Lansky both became friends and started a lasting partnership. The men forged close ties to Jewish ganglord Arnold Rothstein during the Prohibition era. Up until Rothsteins murder in 1928, Lansky had high regards for Rothstein and regarded him as his mentor.

Atlantic City Conference

Gambling Operations

Meyer Lansky Signature

By 1936, Lansky had established gambling operations in Florida, New Orleans, and Cuba. These gambling operations were successful as they were founded upon two innovations:First, Lansky and his connections had the technical expertise to manage them effectively based upon Lansky's knowledge of the true mathematical odds of most popular wagering games.Second, mob connections were used to ensure legal and physical security of their establishments from other crime figures, and law enforcement (through bribes).There was also an absolute rule of integrity concerning the games and wagers made within their establishments. Lansky's "carpet joints" in Florida and elsewhere were never "clip-joints" where gamblers were unsure of whether or not the games were rigged against them. Lansky ensured that the staff (the croupiers and their management) actually consisted of men of high integrity.In 1936, Lansky's partner Luciano was sent to prison.Lansky later convinced the Mafia to place Bugsy Siegel in charge of Las Vegas, and became a major investor in Siegel's Flamingo Hotel.After Al Capone's 1931 conviction for tax evasion and prostitution, Lansky saw that he too was vulnerable to a similar prosecution. To protect himself, he transferred the illegal earnings from his growing casino empire to a Swiss numbered bank account, where anonymity was assured by the 1934 Swiss Banking Act. Lansky eventually even bought an offshore bank in Switzerland, which he used to launder money through a network of shell and holding companies.[7]

National Crime Syndicate

By 1936 Lansky had established gambling operations in Florida, New Orleans and Cuba. In the meanwhile Luciano had risen to top of the American Mafia in after settling the Castellammarese war between Giuseppe Masseria and Salvatore Maranzano. The Thanks to Prohibition the organization was worth millions. Money which was used to invest in several legal ventures with Lansky as their main investor.

Las Vegas

By that time Bugsy Siegel, his old companion, was living in Los Angeles in order of gaining control of the Trans-American Wire service, in which he succeeded. Siegel, flamboyant as ever, had high ambitions. On his recommendation Lansky visited the Nevada desert where Siegel believed they could earn future profits from the tourist industry.Since the construction of the Hoover Dam was finished in 1935 more and more tourists had found their way to the remote area. Siegel was supported by Lansky who managed to gain the financial resources from the New York Mafia. They bought the El Cortez hotel and also bought shares of the Golden Nugget hotel and casino. Since that moment the Mafia had entered Las Vegas and wasn't thinking of leaving.

World War II

In the 1930s, Meyer Lansky and his gang claimed to have stepped outside their usual criminal activities to break up rallies held by the pro-Nazi German-American Bund. Lansky recalled a particular rally in Yorkville, a German neighborhood in Manhattan, that he claimed he and 14 other associates disrupted:The stage was decorated with a swastika and a picture of Adolf Hitler. The speakers started ranting. There were only fifteen of us, but we went into action. We threw some of them out the windows. Most of the Nazis panicked and ran out. We chased them and beat them up. We wanted to show them that Jews would not always sit back and accept insults.[8]During World War II, Lansky was also instrumental in helping the Office of Naval Intelligence's Operation Underworld, in which the government recruited criminals to watch out for German infiltrators and submarine-borne saboteurs.According to Luciano's authorized biography, during this time, Lansky helped arrange a deal with the U.S. Government via a high-ranking U.S. Navy official. This deal would secure the release of Luciano from prison; in exchange, the Italian Mafia would provide security for the war ships that were being built along the docks in New York Harbor. German submarines were sinking Allied shipping in great numbers along the eastern seaboard and the Caribbean coast,[9] and there was great fear of attack or sabotage by Nazi sympathizers.

Cuba

After World War II, Lansky associate Lucky Luciano was paroled from prison on the condition that he permanently return to Sicily. However, Luciano secretly moved to Cuba, where he worked to resume control over American Mafia operations. Luciano also ran a number of casinos in Cuba with the sanction of Cuban president General Fulgencio Batista, though the US government succeeded in pressuring the Batista regime to deport Luciano.Batista's closest friend in the Mafia was Lansky. They formed a renowned friendship and business relationship that lasted for a decade. During a stay at the Waldorf-Astoria in New York in the late 1940s, it was mutually agreed upon that, in exchange for kickbacks, Batista would offer Lansky and the Mafia control of Havana's racetracks and casinos. Batista would open Havana to large scale gambling, and his government would match, dollar for dollar, any hotel investment over $1 million, which would include a casino license. Lansky would place himself at the center of Cuba's gambling operations. He immediately called on his associates to hold a summit in Havana.The Havana Conference was held on December 22, 1946 at the Hotel Nacional. This was the first full-scale meeting of American underworld leaders since the Chicago meeting in 1932. Present were such figures as Joe Adonis and Albert "The Mad Hatter" Anastasia, Frank Costello, Joseph "Joe Bananas" Bonanno, Vito Genovese, Moe Dalitz, Thomas Luchese, from New York, Santo Trafficante Jr. from Tampa, Carlos Marcello from New Orleans, and Stefano Magaddino, Joe Bonanno's cousin from Buffalo. From Chicago there were Anthony Accardo and the Fischetti brothers, "Trigger-Happy" Charlie and Rocco, and, representing the Jewish interest, Lansky, Dalitz and "Dandy" Phil Kastel from Florida.

Havana Conference

During the 1940s, Lansky's associate Benjamin "Bugsy" Siegel persuaded the crime bosses to invest in a lavish new casino hotel project in Las Vegas, the Flamingo. After long delays and large cost overruns, the Flamingo Hotel was still not open for business. To discuss the Flamingo problem, the Mafia investors attended a secret meeting in Havana, Cuba in 1946.While the other bosses wanted to kill Siegel, Lansky begged them to give his friend a second chance. Despite this reprieve, Siegel continued to lose Mafia money on the Flamingo Hotel. A second meeting was then called. However, by the time this meeting took place, the casino turned a small profit. Lansky again, with Luciano's support, convinced the other investors to give Siegel some more time.The Flamingo was soon losing money again. At a third meeting, the other investors decided that Siegel was finished. It is widely believed that Lansky himself was compelled to give the final okay on eliminating Siegel due to his long relationship with Siegel and his stature in the organisation.

Siegel Murder

On June 20, 1947, Siegel was shot and killed in Beverly Hills, California. Twenty minutes after the Siegel hit, Lansky's associates, including Gus Greenbaum and Moe Sedway, walked into the Flamingo Hotel and took control of the property. According to the Federal Bureau of Investigation, Lansky retained a substantial financial interest in the Flamingo for the next twenty years. Lansky said in several interviews later in his life that if it had been up to him, "... Ben Siegel would be alive today."This also marked a power transfer in Vegas from the New York crime families to the Chicago Outfit. Although his role was considerably more restrained than in previous years, Lansky is believed to have both advised and aided Chicago boss Tony Accardo in initially establishing his hold.Siegels ambition's however continued. His ultimate dream was building a bigger-than-life casino from scratch. Lansky followed his idea and became a big investor in Siegels project. The construction was finished in 1947. The hotel and casino, named the Flamingo, was the starting point of what would become known as the Las Vegas Strip. But by the time the construction was finished, the cost had moved up to about three times the original price.

Siegel's Assassination

The grand opening wasn't successful and Siegel, who had more eyes for his money stealing girlfriend, didn't seem to care much. The Commission was angered for their massive loss of money and Siegels behavior.On June 20, 1947, Siegel was assassinated in his house in Beverly Hills. The control of the Flamingo hotel then passed to Lansky who put his co-workers Gus Greenbaum and Moe Sedway in day to day control. However, Lansky would always feel bad about the sad ending of his old pal, certainly when the Flamingo ultimately did prove to be profitable after all.The first to arrive was Lucky Luciano, who had been deported to Italy, and had to travel to Havana with a false passport. Lansky shared with them his vision of a new Havana, profitable for those willing to invest the right sum of money. According to Luciano's evidence, and he is the only one who ever recounted the events in any detail, he confirmed that he was appointed as kingpin for the mob, to rule from Cuba until such time as he could find a legitimate way back into the U.S. Entertainment at the conference was provided by, among others, Frank Sinatra who flew down to Cuba with his friends, the Fischetti brothers.In 1952, Lansky even offered then President Carlos Prío Socarrás a bribe of U.S. $250,000 to step down so Batista could return to power. Once Batista retook control of the government in a military coup in March, 1952 he quickly put gambling back on track. The dictator contacted Lansky and offered him an annual salary of U.S. $25,000 to serve as an unofficial gambling minister.By 1955, Batista had changed the gambling laws once again, granting a gaming license to anyone who invested $1 million in a hotel or U.S. $200,000 in a new nightclub. Unlike the procedure for acquiring gaming licenses in Vegas, this provision exempted venture capitalists from background checks. As long as they made the required investment, they were provided with public matching funds for construction, a 10-year tax exemption and duty-free importation of equipment and furnishings.The government would get U.S. $250,000 for the license plus a percentage of the profits from each casino. Cuba's 10,000 slot machines, even the ones which dispensed small prizes for children at country fairs, were to be the province of Batista's brother-in-law, Roberto Fernandez y Miranda. An Army general and government sports director, Fernandez was also given the parking meters in Havana as a little something extra.Import duties were waived on materials for hotel construction and Cuban contractors with the right "in" made windfalls by importing much more than was needed and selling the surplus to others for hefty profits. It was rumored that besides the U.S. $250,000 to get a license, sometimes more was required under the table. Periodic payoffs were requested and received by corrupt politicians.Lansky set about reforming the Montmartre Club, which soon became the "in" place in Havana. He also long expressed an interest in putting a casino in the elegant Hotel Nacional, which overlooked El Morro, the ancient fortress guarding Havana harbor. Lansky planned to take a wing of the 10-storey hotel and create luxury suites for high-stakes players. Batista endorsed Lansky's idea over the objections of American expatriates such as Ernest Hemingway and the elegant hotel opened for business in 1955 with a show by Eartha Kitt. The casino was an immediate success.[10]Once all the new hotels, nightclubs and casinos had been built Batista wasted no time collecting his share of the profits. Nightly, the "bagman" for his wife collected 10 percent of the profits at Trafficante's interests; the Sans Souci cabaret, and the casinos in the hotels Sevilla-Biltmore, Commodoro, Deauville and Capri (part-owned by the actor George Raft). His take from the Lansky casinos, his prized Habana Riviera, the Nacional, the Montmartre Club and others, was said to be 30 percent. What exactly Batista and his cronies actually received in total in the way of bribes, payoffs and profiteering has never been certified. The slot machines alone contributed approximately U.S. $1 million to the regime's bank account.

Cuban Revolution

The 1959 Cuban revolution and the rise of Fidel Castro changed the climate for mob investment in Cuba. On that New Year's Eve of 1958, while Batista was preparing to flee to the Dominican Republic and then on to Spain (where he died in exile in 1973), Lansky was celebrating the $3 million he made in the first year of operations at his 440-room, $18 million palace, the Habana Riviera. Many of the casinos, including several of Lansky's, were looted and destroyed that night.On January 8, 1959, Castro marched into Havana and took over, setting up shop in the Hilton. Lansky had fled the day before for the Bahamas and other Caribbean destinations. The new Cuban president, Manuel Urrutia Lleó, took steps to close the casinos.In October 1960, Castro nationalized the island's hotel-casinos and outlawed gambling. This action essentially wiped out Lansky's asset base and revenue streams. He lost an estimated $7 million. With the additional crackdown on casinos in Miami, Lansky was forced to depend on his Las Vegas revenues.

Escape

In 1970, Lansky fled to Herzliya Pituah, Israel, to escape federal tax evasion charges. Although the Israeli Law of Return allows any Jew to settle in the State of Israel, it excludes those with criminal pasts. Two years after Lansky fled to Israel, Israeli authorities deported him back to the U.S. The U.S. government brought Lansky to trial with the testimony of loan shark Vincent "Fat Vinnie" Teresa, an informant with little or no credibility. Lansky was acquitted in 1974.Death[edit]Lansky's last years were spent quietly at his home in Miami Beach. He died of lung cancer on November 15, 1982, age 80, leaving behind a widow and three children.[11] On paper, Lansky was worth almost nothing. At the time, the FBI believed he left behind over $300 million in hidden bank accounts, but they never found any money.However, his biographer Robert Lacey describes Lansky's financially strained circumstances in the last two decades of his life and his inability to pay for health care for his handicapped son who eventually died in poverty. For Lacey, there was no evidence "to sustain the notion of Lansky as king of all evil, the brains, the secret mover, the inspirer and controller of American organized crime."[12] He concludes from evidence including interviews with the surviving members of the family that Lansky's wealth and influence had been grossly exaggerated, and that it would be more accurate to think of him as an accountant for gangsters rather than a gangster himself. His granddaughter told author T.J. English that at his death in 1983, Lansky left only $37,000 in cash.[13] When asked in his later years what went wrong in Cuba, the gangster offered no excuses. "I crapped out," he said. Lansky even went as far as to tell people he had lost almost every penny in Cuba and that he was barely scraping by.Hank Messick, a journalist for the Miami Herald who had spent years investigating Lansky, said the key to understanding Lansky lay with the people around him. "Meyer Lansky doesn't own property. He owns people" stressed Messick[citation needed]. To him, the FBI and legendary Manhattan D.A. Robert Morgenthau, the reality was Lansky had kept large sums of money in other people's names for decades and that keeping very little in his own was nothing new to him. Recently, Lansky's own daughter Sandra publicly stated her father had transferred some $15 million to his brother's account sometime in the early 1970s, when Lansky was having problems with the IRS.[14] How much money Meyer Lansky was really worth will probably never be known.

“A newspaper man wrote an article that I had 300 million dollars, well, I wish I had a million dollars”

Meyer Lansky

Sources

Primary Sources

Secondary Sources