[From Investigation of Organized Crime in Interstate Commerce: Hearings before the Special Committee to Investigate Organized Crime in Interstate Commerce, U.S. Senate, 81st Cong., 2nd Sess. and 82nd Congress, 1st Sess., Part 10, US Government Printing Office, Washington DC: 1950., pp. 41-48.]

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ORGANIZED CRIME IN INTERSTATE COMMERCE        41

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TESTIMONY OF LOUIS WIENER, ATTORNEY, LAS VEGAS, NEV.

            The CHAIRMAN. Mr. Wiener, do you solemnly swear that the testimony you will give this committee will be the truth, the whole truth, and nothing but the truth, so help you God?

            Mr. WIENER. I do.

            Mr. HALLEY. Mr. Wiener, we understand that you are the attorney for the executor of the Bugsie Siegel estate, is that correct?

            Mr. WIENER. That is correct.

            Mr. HALLEY. And that the inventory of the estate shows that his interest in the book, the horse book—is it the Golden Nugget—was listed as having no value whatsoever?

            Mr. WIENER. I have a copy of—zero. Zero, nothing.

            Mr. HALLEY. As the attorney for the executor, have you ever contested that listing as that of having no value whatsoever?

            Mr. WIENER. We haven't yet. As a matter of fact, we haven't done anything more than to file the original inventory and defend a lawsuit. We haven't started to close the estate, and it will probably be some time before we do.

            Mr. HALLEY. Is it your opinion that that interest which we understand was taken over by Rosen has any value or has not?

            Mr. WIENER. Did you ask me for my opinion?

            Mr. HALLEY. Your professional opinion as the attorney for the executor.

            Mr. WIENER. To be frank with you, I didn't know the agreement that existed between the partners. As to the exact agreement that he had as to what would happen in the event of one of the partner's death, that is. So I can't tell you whether there is an equity there or there isn't an equity.

            Mr. HALLEY. Have you made any effort to find out?

            Mr. WIENER. No; I haven't to date.

            Mr. HALLEY. How long would it take you to settle an estate?

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            Mr. WIENER. In this particular State, it would take a considerable number of years because the chief asset of the estate consists of promissory notes that were in favor of Siegel and against the Nevada Projects Corp. At the present time the Nevada Projects Corp., as its only asset, has promissory notes from the present owner of the Flamingo Hotel which is the Flamingo Hotel, Inc.

            The Flamingo Hotel, Inc., is paying off the purchase price to the Nevada Projects Corp, at the rate of approximately $29,000 or $30,000 a month, which money goes to the Valley National Bank in Phoenix, to be applied, first, to mechanics' liens—first to a loan of $600,000 in favor of the Valley National Bank in Phoenix, and mechanics' liens that were against the hotel at the time it was sold. And after that, after all of the debts in favor of the creditors and the bank had been cleared up, then the money will be turned into the Nevada Projects Corp. itself for distribution to the stockholders.

            So we will have to wait until the payment by the Flamingo Hotel has been completed before we can close the estate, because there is some money due and owing to the Government for back taxes, and we actually have no cash—well, there is about $3,700, or was $3,700, in the bank and that is all there was in cash. So it will be a good many months, maybe years, before we can close the estate.

            Mr. HALLEY. Does the interest that Siegel had in the Pioneer show up in the inventory ?

            Mr. WIENER. In the Pioneer Club? He never had one.

            Mr. HALLEY. He never had an interest in the Pioneer Club

            Mr. WIENER. Never.

            Mr. HALLEY. Did he have an interest in the Frontier Club?

            Mr. WIENER. He had. an interest in the Frontier turf book—Frontier Club turf book.

            Mr. HALLEY. What was that listed at?

            Mr. WIENER. $3,353.89.

            Mr. HALLEY. Did you collect that money from anybody ?

            Mr. WIENER. That money has been collected. That was money that was on hand.

            Mr. HALLEY. Money on hand ?

            Mr. WIENER. That is, in addition to the $3,700 I mentioned that was cash.

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            Mr. HALLEY. You are personally familiar with the affairs of the Frontier Club?

            Mr. WIENER. That part of it I am. We are the attorneys for them.

            Mr. HALLEY. What are the assets listed in the inventory for Bugsy Siegel? Are they confined in your accounting just to the State of Nevada?

            Mr. WIENER. That is correct. There is some listed in California. I believe I have it here. It is nominal. It is personal belongings, rings and things like that, that are just personal, that happened to be in a safe deposit box down there at the Tax Commission, or whatever they have that freezes this—inheritance tax.

            Mr. HALLEY. Will you state what the assets are ?

            Mr. WIENER. They are very limited, whatever they are. I have just a letter that was sent as to just what they were. By the way, there is—I guess they made him have an original administration down there, although Siegel lived here. They required an original administration down there to get that box open.

            It is a yellow clip with a yellow metal Mexican coin.

            Mr. HALLEY. What I had in mind was the assets here in the State of Nevada.

            Mr. WIENER. I thought you asked for

            Mr. HALLEY. Not jewelry.

            Mr. WIENER. Jewelry—I thought you asked what was in California.

            Mr. HALLEY. You said it was nominal.

            Mr. WIENER. Just wrist watches and combs and things like that. You want all we have listed here?

            Mr. HALLEY. Please.

            Mr. WIENER. There is a balance in a commercial account in the Union Bank & Trust, in Los Angeles, $3,763.37. There is a check drawn on the Farmers & Merchants National Bank in Los Angeles in favor of the estate of Benjamin Siegel for $108.73.

            There was 1,000 shares of American Power & Light, subject to a collateral due from the Union Bank & Trust Co., Los Angeles, the loan being in the sum of $6,375 plus accrued interest, and the net value of that $7,055.

            There was one certificate for 100 shares of Nevada Projects, a certificate for 95 shares in the Nevada Projects. There is a certificate for 25 shares, Nevada Projects. The value of that is zero. There is no value at all.

            There is a promissory note dated August 7, 1946, from Nevada Projects Corp., the face amount of $113,000. We set the value of that at $68,000.

            There is another promissory note from the Nevada Projects in the value of $25,000. We set it at $15,000.

            There is an accounts receivable from the same for $22,000, which we appraised at $13,200.

            There was a 1946 Chrysler convertible, which we appraised at $2,300. I think we sold it for $1,900 through the estate.

            There were some 500 shares of Thikol Corp. stock which we appraised           

            Mr. HALLEY. What was that?

            Mr. WIENER. T-h-i-k-o-I. What that is, I just know that there were 500 shares of stock.

            Senator TOBEY. Any Mountain Mining stock there?

            Mr. HALLEY. What percentage of the horse book at the Frontier Club did he own ?

            Mr. WIENER. That I do not have, his exact percentage. As I remember, lie had approximately 20 percent of it.

            Mr. HALLEY. Was that 20 percent interest listed as having any value ?

            Mr. WIENER. Yes; $3,353.89.

            Mr. HALLEY. That was just money on hand. How about the proprietary interest?

            Mr. WIENER. That wasn't listed as having any value.

            Mr. HALLEY. It would have value, would it not?

            Mr. WIENER. That book, I would say, had no value. That book, in my opinion

            Mr. HALLEY. What would be the basis of your opinion ?

            Mr. WIENER. It hasn't even been able, for the last 3 years, to barely pay its rent. In fact, they had to have their rent cut $500 a month a while back in order to stay open.

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            Mr. WIENER. No.

            And the interest in the Frontier Turf Club, $3,353.89.

            Mr. HALLEY. Is that all ?

            Mr. WIENER. The Golden Nugget book at zero.

            Mr. HALLEY. To get back to the Golden Nugget, you do not contemplate attempting to obtain that asset for the estate?

            Mr. WIENER. At the present time there hasn't been any move to obtain anything.

            Mr. HALLEY. Wasn't that your responsibility ?

            Mr. WIENER. Not solely. Mr. Siegel—Maury Siegel, who is the administrator in the estate—that is, Siegel—Maury Siegel—is a resident of Los Angeles, Calif., and he has counsel in Los Angeles who also represented Siegel in Los Angeles, Joseph Ross.

            Mr. HALLEY. Who ?

            Mr. WIENER. Joe Ross. He is with Pacht, Tannenbaum & Ross. He has been giving a lot of the advice from Los Angeles to Mr. Siegel, to Maury Siegel.

            Senator TOBEY. What interest did Bugsy Siegel have in the Golden Nugget?

            Mr. JONES. Do you mean in the Golden Nugget race book ?

            Mr. WIENER. I don't know. To my knowledge, there wasn't a written agreement.

            Mr. ROBINSON. Is there anything in that file that would indicate that a Harry Sackman did tax work for Mr. Siegel?

            Mr. WIENER. Harry Sackman? There is nothing in the file. I would say offhand he never did. The only man that I knew did tax work for Ben—I can tell you in a minute. I think it was Aaron Rosenthal. He is the only one. And then there is a fellow named Sam Pott that did some, but I don't think Sackman did.

            Mr. ROBINSON. Is there anything in the file to indicate that Mr. Donald Burcher was the Government agent which Mr. Siegel's tax matters were assigned to ?

            Mr. WIENER. No; they haven't dealt with me on the tax at all. They haven't even contacted me.

            Mr. HALLEY. Wouldn't you think that an interest in a racing book would have some value, particularly at the Golden Nugget?

            Mr. WIENER. They had, as I remember, only just practically a month-to-month lease in those places, and under those circumstances it would have practically no value because if you are out at the end of a month you haven't got anything you can sell.

            Mr. HALLEY. Didn't you know that Rosen had paid $15,000 by check for that interest.

            Mr. WIENER. That he had paid $15,000?

            Mr. HALLEY. Yes.

            Mr. WIENER. To my knowledge, he didn't pay it. He may have, but to my knowledge he didn't pay it. Is it secret to whom he paid it? I will say this, he didn't pay it to the estate.

            Mr. HALLEY. He apparently paid it to the other owners of the book.

            Mr. WIENER. I have some knowledge of that $15,000. That is hearsay.

            Mr. HALLEY. Go ahead.

            Mr. WIENER. He didn't pay $15,000 for the interest. He put up a check for $15,000 which was to be used as bank roll. I may say this,

ORGANIZED CRIME IN INTERSTATE COMMERCE        45

that at the time of Siegel's death, as I understand, the bank roll was very limited. They didn't keep much on hand. I imagine if they needed it they always could get $5,000 or $10,000, and they didn't book heavy enough so that they would probably lose that much in a day or 2 days.

            But when Siegel died I understand that Rosen put up a check for $15,000 for bank roll, which I presume they could have cashed at the cashier's cage at the Nugget had they needed it, but they never cashed it.

            Mr. HALLEY. You understood that was to be for bank roll rather than for his share of the book?

            Mr. WIENER. It was never cashed, so I presume that was what it was for.

            Mr. HALLEY. Have you filed an income tax for Siegel?

            Mr. WIENER. Mr. Rosenthal filed that.

            Mr. HALLEY. What was his income in the year in which he died?

            Mr. WIENER. I don't have a copy. Mr. Rosenthal in Los Angeles, the certified public accountant, has that.

            Mr. HALLEY. Don't you have that information in your mind?

            Mr. WIENER. I have never seen it.

            Mr. HALLEY. Do you have any idea of what it was ?

            Mr. WIENER. His income ?

            Mr. HALLEY. Yes.

            Mr. WIENER. I wouldn't have the slightest idea. His income from Nevada would be nothing, I think, because he lost money in the Frontier Turf Club and because at the time of his death he owed quite a few thousand dollars to the Turf—the Frontier Turf Club, to people who had been his partners in the Frontier Turf Club, and they filed claims against the estate for it, which were approved.

            Mr. HALLEY. What was the total amount of those claims ?

            Mr. WIENER. I will tell you in just a moment. One was for—in favor of Moe Sedway for $3,843.27. One was in favor of his brother-in-law, Solly Soloway, for $2,305 and—excuse me, that wasn't the Frontier Turf Club. This was the Golden Nugget; I am sorry. Mr. Solly Soloway had $2,305.96 as a claim. And J. K. House had a claim for $1,537.30.

            Senator TOBEY. Is Sedway a Las Vegas man ?

            Mr. WIENER. Yes. He owns part of the Flamingo Hotel. Their claims were moneys due from the deceased, an outgrowth of the deceased's drawing in excess of the capital in the Golden Nugget claim in which the deceased and claimants were partners.

            The CHAIRMAN. How did this fellow Rosen take over when Siegel got killed? Did he just move in?

            Mr. WIENER. As far as I know, he just went down and took over.

            The CHAIRMAN. You must know something about it. Who sent Rosen in here, anyway ?

            Mr. WIENER. He was here before Siegel died. He owned an interest in the Nevada Projects.

            The CHAIRMAN. I thought he came back, though, to Las Vegas right after the death of Siegel.

            Mr. WIENER. He was in and out all the time. I couldn't say that he came back right after. I think he probably did, but he was here after they opened. I think they opened in December of 1946, I think

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about the 26th or 27th, a few days before New Year's, and they closed the end of February, and they opened again the 1st of March; and he was here off and on most of the time.

            The CHAIRMAN. Did you find any contract or any agreement or anything that would justify him to move in and take over Siegel's interest?

            Mr. WIENER. No ; as far as contracts between those fellows, they just—most of them just don't have contracts.

            The CHAIRMAN. Any other questions?

            Mr. HALLEY. Were you attorney for the Nevada Projects Corp.

            Mr. WIENER. Yes.

            Mr. HALLEY. What was the business of the Nevada Projects Corp. ?

            Mr. WIENER. That is the Flamingo. That is the Flamingo Hotel.

            Mr. HALLEY. When did you become attorney ?

            Mr. WIENER. I was attorney for the people that owned the property who sold it to the Nevada Projects. I was attorney all the time until approximately a year ago, and then continued on into the new corporation, the Flamingo Hotel.

            Mr. HALLEY. You are still attorney for the Flamingo?

            Mr. WIENER. No.

            Mr. HALLEY. You were up to about a year ago?

            Mr. WIENER. Yes; a year, a year and a half maybe.

            Mr. HALLEY. Who were the owners with Siegel of the Flamingo?

            Mr. WIENER. Morris Rosen held some stock.

            Mr. HALLEY. Did he hold that stock before Siegel's death?

            Mr. WIENER. Yes.

            Mr. HALLEY. Joseph Ross, the attorney in Los Angeles, had some stock ?

            Mr. WIENER. Moe Sedway had some stock, Solly Soloway had some stock, Allen Smiley had some stock; a fellow by the name of Black, from Los Angeles, a doctor, I think he is. I don't know him, just except to see him. He has some stock.

            Harry Rothberg has some stock, Sam Rothberg—I believe his brother—I believe it was Sam had some stock. I think Lansky had some.

            Mr. HALLEY. Did Lansky have some stock?

            Mr. WIENER. I think he did.

            Mr. HALLEY. Which Lansky?

            Mr. WIENER. Meyer.

            Mr. HALLEY. How much stock did he have?

            Mr. WIENER. That I can't tell you. I can't tell you exactly. It was my recollection that it wasn't a large percentage. I mean, there were so many in it. Siegel held the largest percentage. I think he held about 22 percent.

            Mr. HALLEY. Did Dave Berman have any stock?

            Mr. WIENER. No; he holds some in the present—or held some in the present corporation.

            Mr. HALLEY. Where is Berman from?

            Mr. WIENER. Minneapolis or Milwaukee, some place. He works at the Flamingo.

            Mr. ROBINSON. A point was reached where Mr. Sanford Adler came into a dominant position with respect to the Flamingo ?

            Mr. WIENER. That was after Siegel was out; that was after he died.

ORGANIZED CRIME IN INTERSTATE COMMERCE        47

            Mr. HALLEY. We are now talking about the owners with Siegel.

            Mr. WIENER. Adler never had anything to do with the Nevada Projects.

            Mr. HALLEY. But Meyer Lansky did; is that right?

            Mr. WIENER. That is the best of my knowledge, 100 shares.

            Mr. HALLEY. What was the change in ownership after Siegel died?

            Mr. WIENER. He died in June, the 22d, as I remember. On July—about the end of June Mr. Adler and his associates made an agreement to buy the property from the Flamingo Hotel, Inc.—or from the Nevada Projects, for $3,900,000 plus interest and inventory, and they formed the Flamingo Hotel, Inc. They made just a little written—short written agreement, paid, I think, $100,000 down.

            Then in July we formed a corporation called Flamingo Hotel, Inc. At that time Adler, Charlie Resnick, and some of the other fellows that had been a partner with him in the El Rancho, together with—they were on one group. And then Gus Greenbaum, Moe Sedway, Dave Berman, Al Abrams, I think lie had 1 or 2 percent.

            Mr. HALLEY. Gus Greenbaum was the man who runs the wire service in Phoenix ; is that right ?

            Mr. WIENER. I don't know whether he does. I knew he came from Phoenix and he was over there for a couple of years. I don't know if lie ran the service. I don't know of my own knowledge.

            They agreed to form this Flamingo Hotel, Inc., and they formed it and they were supposed to issue stock, and Adler was supposed to have his—his group had about 49 percent of the stock. They had 49 percent, and they were supposed to get 2 percent, an irrevocable proxy to 2 percent of the stock of the other group.

            Adler's group, although they had 49 percent actual ownership, were supposed to get a proxy for 2 percent, an irrevocable proxy, so that they could have the control of the policy of the hotel.

            Mr. HALLEY. What happened to Lansky in this reorganization ?

            Mr. WIENER. He wasn't in it.

            Mr. HALLEY. Who got his stock ?

            Mr. WIENER. There wasn't any. He has the stock, I presume, in Nevada Projects. But they sold ---

            Mr. HALLEY. To the new group, and he was just washed out then?

            Mr. WIENER. Then after that—well, yes, unless he held some notes, he was washed out because the stock had no value.

            Mr. HALLEY. After some time Adler left the Flamingo ; did he not?

            Mr. WIENER. Yes; about in December of '47 or November of '47, somewhere around there, there was a question as to—I know what it was. Morris Rosen—they hadn't issued the stock. This stock was being issued by Mr. Adler's Los Angeles attorney. We didn't handle the issuing of the stock, and he didn't issue the stock for about 5 months although they had put up their money. Morris Rosen wanted his stock issued to him and he was the one that was supposed to give the proxy of 2 percent of his stock to Adler, and that would give them 51 percent in Adler's group and 49 in the other one. And he wouldn't—Adler refused—he was the president of the corporation, and he refused to issue the stock unless Rosen would, at the same time, give an irrevocable proxy for 2 percent, so that he would have control.

            They had written this agreement for this irrevocable proxy on a piece of scratch paper without any counsel. There was no attorney

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present, and Rosen refused to give up his 2 percent voting rights, so Adler refused to issue the stock. And Rosen brought a mandamus action in the Supreme Court of Nevada, and we had been the attorneys for the Flamingo Hotel, Inc., so we represented the hotel, and Adler also, so we went to the supreme court and fought it out. And a day or two before the decision came down—it was never actually given—Adler called us out to the hotel and we negotiated—Cliff and I negotiated—the sale of their 49 percent to the other group.

            Mr. HALLEY. Adler left town about that time; didn't he?

            Mr. WIENER. Moved to Reno.

            Mr. HALLEY. He has never been back ?

            Mr. WIENER. Yes; lie has. He is back looking for a place.

            Senator WILEY. Where does he go?

            Mr. WIENER. Reno and Lake Tahoe. He has a club in Reno and a hotel at the lake, hotel at the lake.

            Mr. HALLEY. Wasn't Adler threatened with violence by Greenbaum?

            Mr. WIENER. Greenbaum? No; absolutely not, to my knowledge. I would say absolutely not.

            Mr. JONES. I think what they are trying to get at is the scuffle they had.

            Mr. WIENER. The scuffle they had? That happened on a Saturday night. Adler and Rosen had some words. Rosen weighs about 140 pounds. He is about 5 foot 6 or 7. And Adler weighs about 165. He is about the same size. And they got to arguing one night, and I guess one of them took a punch at the other one, and they had a little scuffle for about 2 minutes out at the hotel, and that is when Adler called us and gave Cliff and I and our other partner the power of attorney to negotiate a sale, and the three of us negotiated the sale.

            Senator WILEY. How much did you get for it?

            Mr. WIENER. I think $5,000 or $6,000.

            Mr. JONES. For the equity that existed at that time?

            Mr. WIENER. It doubled the investment.

            Mr. JONES. They made a profit on the deal. Adler made some small profit on the deal. He got his money out with a profit, as I recall.

            Mr. HALLEY. Didn't he threaten to kill Adler if he didn't get out?

            The CHAIRMAN. Why was he so anxious to sell after that scuffle?

            Mr. WIENER. He figured they weren't going to get along and in a gambling operation if the partners don't get along it is not a very good policy to stay in because everybody is handling money.

            Mr. JONES. He controlled a competing business, too. At that time he had control of the El Rancho, which was a competitive business, and he was favoring one over the other, and so he let the Flamingo go and went back to El Rancho to concentrate on that.

            The CHAIRMAN. Thank you very much.

(Witnesses Wiener and Jones excused.)