August 8, 2006

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[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.64-94.]

 

INVESTIGATION OF ORGANIZED CRIME IN INTERSTATE COMMERCE

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64        ORGANIZED CRIME IN INTERSTATE COMMERCE

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TESTIMONY OF MOE SEDWAY, VICE PRESIDENT, FLAMINGO HOTEL, LAS VEGAS, NEV.

            The CHAIRMAN. Mr. Sedway, 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. SEDWAY. I do.

            The CHAIRMAN. You have been sick. What is the matter with you?

            Mr. SEDWAY. I have had three major coronary thromboses, and I have had diarrhea for 6 weeks, and I have an ulcer, hemorrhoids, and an abscess on my upper intestines.

            I just got out of bed and I am loaded with drugs.

            Mr. HALLEY. I will ask you some questions, Mr. Sedway, and if at any point you feel that you are under too great a physical strain, you just speak up.

            Mr. SEDWAY. I will be all right. Thank you.

            Mr. HALLEY. How old are you, Mr. Sedway ?

            Mr. SEDWAY. Fifty-seven.

            Mr. HALLEY. What is your address?

            Mr. SEDWAY. Flamingo Hotel.

            Mr. HALLEY. How long have you lived at the Flamingo Hotel?

            Mr. SEDWAY. Since 1947.

            Mr. HALLEY. What is your business ?

            Mr. SEDWAY. I am vice president of the Flamingo Hotel.

            Mr. HALLEY. Where were you born?

            Mr. SEDWAY. I was born in Poland.

            Mr. HALLEY. When did you come to the United States?

            Mr. SEDWAY. 1901.

            Mr. HALLEY. Are you a citizen?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. When did you become a citizen?

            Mr. SEDWAY. I became a citizen on July 16, 1914, by virtue of my father's papers.

            Mr. HALLEY. When you came to the United States, where did you go first?

            Mr. SEDWAY. New York City.

            Mr. HALLEY. How long did you live in New York City?

            Mr. SEDWAY. I lived in New York City until 1938.

            Mr. HALLEY. Until 1938 ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Then from New York City where did you go?

            Mr. SEDWAY. I went to California.

            Mr. HALLEY. To Los Angeles?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. How long did you live in Los Angeles?

            Mr. SEDWAY. I lived in Los Angeles a little over 2 years. In fact, my family is in—lives in Los Angeles now.

ORGANIZED CRIME IN INTERSTATE COMMERCE        65

            Mr. HALLEY. From Los Angeles did you come to Las Vegas?  

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. And you have lived here ever since?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. That would be since 1940 ?

            Mr. SEDWAY. About 1941, the latter part of 1941.

            Mr. HALLEY. If I am going too fast, you just tell me. We want to show proper respect for your health and don't want to hurt you in any way physically.

            Mr. SEDWAY. It is all right.

            Mr. HALLEY. Were you ever arrested ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. When were you arrested? If you were arrested on more than one occasion

            Mr. SEDWAY. I was never convicted of a felony, if that is what you want to know.

            Mr. HALLEY. I want to know, first, about arrests, and then about convictions.

            Mr. SEDWAY. I was arrested in 1919.

            Mr. HALLEY. On what charge ?

            Mr. SEDWAY. The charge was unlawful entry.

            Senator TOBEY. Is that an immigration case, or breaking and entering?

            Mr. SEDWAY. No, sir; it was on a Saturday afternoon and we were running a crap game in the loft up in the twenties. I don't remember what street it was. And it was raided, and I was arrested with one other man, charged with unlawful entry.

            Mr. HALLEY. Were you convicted ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Did you go to prison ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. For how long?

            Mr. SEDWAY. I went to the reformatory for 3 months to 3 years. 1 did a little less than a year.

            Mr. HALLEY. How old were you at the time, Mr. Sedway ?

            Mr. SEDWAY. I was 22 years old, I think.

            Mr. HALLEY. Were you ever arrested on any other occasion?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. When were you next arrested ?

            Mr. SEDWAY. I was arrested in 1935.

            Mr. HALLEY. On what charge ?

            Mr. SEDWAY. Conspiracy.

            Mr. HALLEY. Were you convicted ?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. What were the facts leading to the arrest, do you know ?

            Mr. SEDWAY. Well   

            Mr. HALLEY. Specifically with what kind of conspiracy?

            Mr. SEDWAY. Conspiracy to—it was a bond case.

            Mr. HALLEY. Was it a bond case?

            Mr. SEDWAY. Bond.

            Mr. HALLEY. Bail bond ?

            Mr. SEDWAY. No, security bonds.

            Mr. HALLEY. You were discharged?

66        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. SEDWAY. Yes, I was acquitted by a jury.

            Mr. HALLEY. What other arrests have you had ? Perhaps I will go through the record with you and we can save a little time.

            Mr. SEDWAY. I was arrested in 1940 in San Diego for gambling.

            Mr. HALLEY. On what charge?

            Mr. SEDWAY. Gambling.

            Mr. HALLEY. You were convicted ?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. In 1942, that is, isn't it?

            Mr. SEDWAY. Was it 1942?

            Mr. HALLEY. Yes.

            Mr. SEDWAY. Around that.

            Mr. HALLEY. What happened to that charge ?

            Mr. SEDWAY. Nothing happened to it at all. I wasn't convicted.

            Mr. HALLEY. Were you ever arrested on any other occasion?

            Mr. SEDWAY. It was changed to—what do you call it.?

            Mr. HALLEY. Disorderly conduct?

            Mr. SEDWAY. No; vagrancy.

            Mr. HALLEY. You were convicted for vagrancy ?

            Mr. SEDWAY. No, I wasn't.

            Mr. HALLEY. You were arrested for vagrancy in Albany, too, weren't you?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Were you ever arrested for assault and robbery 's

            Mr. SEDWAY. Not that I know of. They may have charged me with it.

            Mr. HALLEY. Didn't you stay in jail overnight for assault and robbery in 1928 in New York ?

            Mr. SEDWAY. But I was arrested in an office on Broadway, and they charged me with assault and robbery of a person and the person was called in and failed to identify, and I was released. That is one of those things. You are Mr. Halley, aren't you ? In order to hold you in New York City, they fix—they put a charge on you regardless of what it is, to keep you overnight, to bring you into court.

            Mr. HALLEY. As early as 1917 you were charged with grand larceny, isn't that right, and then discharged?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. In 1920 you were charged with burglary and discharged, is that right ?

            Mr. SEDWAY. I was discharged—no, I wasn't discharged. That was the unlawful entry.

            Mr. HALLEY. Was that changed?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Reduced to unlawful entry ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Then in 1935 you were arrested for vagrancy, is that right ?

            Mr. SEDWAY. No, conspiracy.

            Mr. HALLEY. And discharged ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Was your name originally Sedwits ? S-e-d-w-i-t-s?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Is Sedway now your legal name ?

ORGANIZED CRIME IN INTERSTATE COMMERCE        67

            Mr. SEDWAY. What do you mean "legal"? I have used it for -- since 1924.

            Mr. HALLEY. Then it is your legal name ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Is it the only name you use ?

            Mr. SEDWAY. Yes. I use it and my children use it in school.

            Mr. HALLEY What was your business in New York? You came to New York in 1901, is that right?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. At that time how old were you ?

            Mr. SEDWAY. Seven years.

            Mr. HALLEY. Did you go to school in New York ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Did you go through a public school?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Did you go through high school ?

            Mr. SEDWAY. No. I went to high school. I didn't finish.

            Mr. HALLEY. Then what business did you go into ?

            Mr. SEDWAY. Well, I worked around New York in the garment industry..

            Mr. HALLEY. What other businesses were you in during the time that you were in New York? That would be from 1901 to 1938, is that right?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Until you were 45 years old ?

            Mr. SEDWAY. I used to frequent race tracks, bet on horses.

            Mr. HALLEY. When did you last have a regular job?

            Mr. SEDWAY. I don't remember; a long time.

            Mr. HALLEY. You gave up working and you became a gambler, is that right?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. And you also got into various—well, at least one other scrape for which you went to jail, is that right?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. After you got out of jail, did you go to work on a regular job'?

            Mr. SEDWAY. Yes, I went, in the trucking business.

            Mr. HALLEY. You were on a payroll, I suppose, for a while?

            Mr. SEDWAY. Yes. I went—I bought a truck and I was in the trucking business with my brother-in-law, and we were delivering merchandise from the various garment houses.

            Mr. HALLEY. How long were you in that business?

            Mr. SEDWAY. Maybe 2, 3 years.

            Mr. HALLEY. After that did you have any other business, or did you go in for gambling?

            Mr. SEDWAY. Well, I was in a business in 1934. I had a restaurant.

            Mr. HALLEY. What restaurant did you have?

            Mr. SEDWAY. Fu Manchu, in New York, Chinese restaurant.

            Mr. HALLEY. How long did you have that restaurant?

            Mr. SEDWAY. About a year.

            Mr. HALLEY. Have you had any other businesses ?

            Mr. SEDWAY. No.

            Mr. HALLEY. What did you do when you went to Los Angeles in 1938 ? What business were you in there ?

68        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. SEDWAY. Bookmaker.

            Mr. HALLEY. Were you associated there with Bugsy Siegel?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. With whom were you associated in the bookmaking business ?

            Mr. SEDWAY. Myself. I used to go to the race track and take co missions and bet for people and book.

            Mr. HALLEY. How long have you known Bugsy Siegel?

            Mr. SEDWAY. Twenty-five years.

            Mr. HALLEY. You knew him in New York?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known Meyer Lansky ?

            Mr. SEDWAY. About the same.

            Mr. HALLEY. Jack Lansky ?

            Mr. SEDWAY. The same.

            Mr. HALLEY. Little Augie Casanno [Pisano?], do you know him ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. The same, 20 years, maybe a little less, about 20.

            Mr. HALLEY. Do you know Frank Costello ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. Twenty-five years.

            Mr. HALLEY. When have you last seen Frank Costello ?

            Mr. SEDWAY. I have seen him about 6 weeks ago.

            Mr. HALLEY. Where ?

            Mr. SEDWAY. In New York.

            Mr. HALLEY. Where in New York ?

            Mr. SEDWAY. I happened to run into him accidentally in the Plaza Cocktail Bar.

            Mr. HALLEY. Did you talk to him'?

            Mr. SEDWAY. I was sitting with some people. He came over said "hello," and that was the extent of our conversation. He says, "How do you feel ?" I says, "How, are you, Frank ?" And that was it.

            Mr. HALLEY. When did you last see Joe Adonis?

            Mr. SEDWAY. Joe Adonis I saw a year ago, at the world series.

            Mr. HALLEY. Did you know Nate Rutkin?

            Mr. SEDWAY. Yes, I did.

            Mr. HALLEY. When did you last see him?

            Mr. SEDWAY. The last time I saw Nate Rutkin was—I was on my way to see my sister this last trip, about 6, 7 weeks ago, during the world series, and I was in the Pennsylvania Station, and I saw him but he didn't see me. And I didn't stop to see him.

            Mr. HALLEY. When did you last talk to him?

            Mr. SEDWAY. The last time I talked to him was the previous ye and I met him in Gallagher's Restaurant.

            Mr. HALLEY. That is where the most of the fellows eat, isn't that right ?

            Mr. SEDWAY. Gallagher's, Moore's.

            Mr. HALLEY. Do you know Frank Erickson?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. About 20 years.

ORGANIZED CRIME IN INTERSTATE COMMERCE        69

            Mr. HALLEY. Have you ever had any business relationship with any of them? Bookmaking or any other business?

            Mr. SEDWAY. No.

            Mr. HALLEY. Have you ever had any kind of financial transaction with any of them?

            Mr. SEDWAY. No.

            Mr. HALLEY. Do you know "Longie" Zwillman ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known him?

            Mr. SEDWAY. About 20 years.

            Mr. HALLEY. Have you ever had any business with him?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Did you ever place a bet with him?

            Mr. SEDWAY. No.

            Mr. HALLEY. Did he ever place one with you ?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Do you know James Rutkin ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. The same time.

            Mr. HALLEY. Harry Stromberg ?

            Mr. SEDWAY. That is the same.

            Mr. HALLEY. You have known him for about 25 years ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Have you ever done business with him?

            Mr. SEDWAY. I have known all these fellows. They were all on the East Side. We were all brought up together.

            Mr. HALLEY. You all went into various gambling businesses, isn't that right?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Were you ever in the liquor business during prohibition.

            Mr. SEDWAY. No; very small way—nothing.

            Mr. HALLEY. Did you know Charlie "Lucky" Luciano ?

            Mr. SEDWAY. Yes, sir; I did.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. I have known him as long as I have known the others. I think I knew him longer than the others.

            Mr. HALLEY. Have you ever had an interest in any gambling establishments in Florida?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Which?

            Mr. SEDWAY. In the Hollywood Yacht Club.

            Mr. HALLEY. Who were your partners there?

            Mr. SEDWAY. Julian Kaufman and some local people. I don't know their names.

            Mr. HALLEY. Do you know Herman Greenspun ?

            Mr. SEDWAY. No.

            Mr. HALLEY. Herman Greenspun?

            Mr. SEDWAY. You don't mean this fellow that has the newspaper, do you ?

            Mr. HALLEY. Yes.

            Mr. SEDWAY. Hank Greenspun?

70        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. HALLEY. Yes.

            Mr. SEDWAY. Yes ; I know him.

            Mr. HALLEY. How long have you known him?

            Mr. SEDWAY. Since he has been here.

            Mr. HALLEY. Does he own any part of the Desert Inn?

            Mr. SEDWAY. I wouldn't know, sir.

            Mr. HALLEY. Have you ever seen him there?

            Mr. SEDWAY. In the Desert Inn? I may have. I am not sure. I may have.

            Mr. HALLEY. Where does he come from?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. New York?

            Mr. SEDWAY. I really don't know.

            Mr. HALLEY. When you went to Los Angeles did you have interest in any gambling establishments?

            Mr. SEDWAY. No.

            Mr. SEDWAY. None whatsoever.

            Mr. HALLEY. None whatsoever?

            Mr. HALLEY. Did you know Charles Fischetti ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Rocco Fischetti?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How long have you known them?

            Mr. SEDWAY. I know Charlie longer than I know Rocky. I would say 15, 16 years. I can't place the exact time.

            Mr. HALLEY. Do you know Jack Dragna ?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. How long have you known him ?

            Mr. SEDWAY. I have known him since I have been in Los Angeles.

            Mr. HALLEY. Have you ever had any business relationship with him, or dealings?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Mike Accone?

            Mr. SEDWAY. I know him.

            Mr. HALLEY. Have you ever had any business dealings with him?

            Mr. SEDWAY. No, sir; haven't talked to him in 10 years.

            Mr. HALLEY. Did you ever have a bet with him one way or the other?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Gene Normile ?

            Mr. SEDWAY. I know Gene.

            Mr. HALLEY. Any business relationships?

            Mr. SEDWAY. No, sir, just friendly.

            Mr. HALLEY. Jake Guzik ?

            Mr. SEDWAY. I know him.

            Mr. HALLEY. How long?

            Mr. SEDWAY. Not very long.

            Mr. HALLEY. Any business relationship?

            Mr. SEDWAY. About 10 years; no.

            Mr. HALLEY. Tony Corica ?

            Mr. SEDWAY. Yes, sir. I met him here.

            Mr. HALLEY. Who introduced you?

            Mr. SEDWAY. I don't remember. I think he stayed at the hotel. It is the first time I met him.

ORGANIZED CRIME IN INTERSTATE COMMERCE        71

            Mr. HALLEY. How long have you known Kleinman?

            Mr. SEDWAY. Kleinman, about 20 years.

            Mr. HALLEY. Where did you first meet him?

            Mr. SEDWAY. New York.

            Mr. HALLEY. Have you ever had a business relationship with him?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. How long have you know Dalitz ?

            Mr. SEDWAY. The same time.

            Mr. HALLEY. Do you know the King boys?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. From Detroit?

            Mr. SEDWAY. No.

            Mr. HALLEY. Do you know Massei ?

            Mr. SEDWAY. No, I don't.

            Mr. HALLEY. Do you know who I mean?

            Mr. SEDWAY. Yes, Joe Massei. I have never met him.

            Mr. HALLEY. Never met him ?

            Mr. SEDWAY. No.

            Mr. HALLEY. Now, when you came to Las Vegas, what was your business activity ? What was your business activity in Las Vegas when you came here in 1940 or 1941 ?

            Mr. SEDWAY. I came here and I had a part interest in the Northern Club book. I came here at the request of Ben Siegel. He had bought in with Dave Stearns in the Northern Club and lie asked me to come down here, and he gave me a piece of the book to look out for his interests.

            Mr. HALLEY. He had been in Los Angeles in the meantime, is that right?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Were you in any business with him in Los Angeles?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Were you all by yourself? No partner?

            Mr. SEDWAY. Well, I don't know, mostly by myself; sometimes you take a bet with somebody. Would you call it a partner?

            Mr. HALLEY. Did you lay off your bets with somebody?

            Mr. SEDWAY. If they were high, I would.

            Mr. HALLEY. With whom would you lay off?

            Mr. SEDWAY. Various bookmakers. I don't remember who, exactly.

            Mr. HALLEY. Name one.

            Mr. SEDWAY. Irving Moss, but he has been out of business a long time.

            Mr. HALLEY. Did you do any business with Bugsy Siegel at that time?

            Mr. SEDWAY. I was around with him. He did a lot of betting, but I didn't do any business with him.

            Mr. HALLEY. Did he have the race wire at that time?

            Mr. SEDWAY. Where is that?

            Mr. HALLEY. In Los Angeles.

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. You don't know ?

            Mr. SEDWAY. No.

72        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. HALLEY. Then you came here at his request to look after his interest in the book, is that right?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. What was your next business here in Las Vegas?

            Mr. SEDWAY. My next business here in Las Vegas was—there is a fellow by the name of Tony Corica. Was it Tony?

            Mr. ROBINSON. That is right.

            Mr. SEDWAY. He was the representative for Continental. Do you know who I mean by Continental ?

            Mr. HALLEY. The wire service ?

            Mr. SEDWAY. That is right. His office was in Phoenix. He serviced Las Vegas. I made a deal with him for a stipulated amount, which I think was $900 a week for him to sell me the exclusive rights to serve Las Vegas.

            Mr. HALLEY. Was Siegel in that deal with you ?

            Mr. SEDWAY. Eventually, yes.

            Mr. HALLEY. At the inception?

            Mr. SEDWAY. No, it was mine. He was in the book with me. If you will let me go ahead with my story

            Mr. HALLEY. What I am trying to find out is, was that your own deal?

            Mr. SEDWAY. That was my own deal.

            Mr. HALLEY. How long had you known Corica?

            Mr. SEDWAY. Since he was coming up here. He came up here. He used to come up here every week.

            Mr. HALLEY. To collect from you?

            Mr. SEDWAY. No, from Stearns and those fellows.

            Mr. HALLEY. Was that about the time when Annenberg went out of the wire service and Ragen took over?

            Mr. SEDWAY. No, I think Annenberg went out of the wire service long before that.

            Mr. HALLEY. He went out before 1938, didn't he?

            The CHAIRMAN. '39.

            Mr. SEDWAY. Well, Annenberg didn't have the wire service--

            Mr. HALLEY. He was out of it a couple of years?

            Mr. SEDWAY. Because Ragen had it and Kelley.

            The CHAIRMAN. What was Corica's name in Phoenix ?

            Mr. SEDWAY. W-a-s-h-o-e Publishing Co.

            Mr. HALLEY. Go ahead.

            Mr. SEDWAY. There were only two in town. There was the Northern Club, which was owned by Dave Stearns, and there was the Las Vegas Club, which was owned by J. K. Houssels. There were two books in town.

            Mr. HALLEY. And you had the book in the Las Vegas Club ?

            Mr. SEDWAY. I had an interest in the book in the Las Vegas Club with Siegel.

            Mr. HALLEY. What was the Las Vegas Club paying?

            Mr. SEDWAY. Not in the Las Vegas Club, in the Northern Club.

            Mr. HALLEY. In the Northern Club ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What were you paying for wire service before you took it over ?

            Mr. SEDWAY. I don't know what they were paying, but they weren't paying—I wouldn't know that. They probably paid $300 apiece.

ORGANIZED CRIME IN INTERSTATE COMMERCE        73

            Mr. HALLEY. $300 apiece. Then you became the exclusive wire service distributor for Las Vegas?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What other territory did you have ?

            Mr. SEDWAY. That is all.

            Mr. HALLEY. Boulder City, or anything?

            Mr. SEDWAY. There is no gambling in Boulder City.

            Mr. HALLEY. You paid $900 a week ?

            Mr. SEDWAY. A week.

            Mr. HALLEY. What arrangements did you make to sell that wire service to the others ?

            Mr. SEDWAY. The only arrangements I made when I got it, the people that owned the Frontier Club asked me if I would put a book in there, being I had the wire, if I would put a book in there. And their business in Las Vegas then was very bad. And they wanted it to bolster their business, and they told me if I put a book in there I can go in there rent free. So I told Siegel about it because he had brought me in this other place, and I told him, "Here we have an opportunity of going in there and have it 100 percent."

            I said, "This $900 we are paying, we will split it three ways. Each club will pay $300, including expenses—or besides the expenses." I don't know the exact amount. "And we will have our own book."

            And he said, "All right."

            I notified Mr. Stearns and Mr. Houssels that I was going to open up there, and here is what I am paying for the service and whatever the expenses are we will split it three ways, and that we did.

            Mr. HALLEY. Then, there were three books in Las Vegas ?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. The Las Vegas Club, the Frontier Club—

            Mr. SEDWAY. And the Northern Club.

            Mr. HALLEY. And you had an interest in the Northern Club book, you and Siegel ?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. And you owned ---

            Mr. SEDWAY. No, no.

            Mr. HALLEY. Completely the book in the Northern Club?

            Mr. SEDWAY. No ; I had no interest n the Northern Club any more.

            Mr. HALLEY. You gave that up ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Who had the Northern Club from then on?

            Mr. SEDWAY. Stearns.

            Mr. HALLEY. The Stearns brothers?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Did they pay you anything for your interest?

            Mr. SEDWAY. No; I didn't have an interest in the club. Siegel was an associate with them. Siegel had bought into the whole club, including the gambling and the book, and I just took care of his interest in the book, and all I had was an interest in the book.

            Mr. HALLEY. Did you get any money for your interest in the book when you left?

            Mr. SEDWAY. No.

            Mr. HALLEY. Wasn't that worth something, that interest in the book ?

74        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. SEDWAY. It was worth more to me to go into this other club and have a bigger interest there and have my own book.

            Mr. HALLEY. In other words, it was part of an all-over deal; is that right?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What was your next business interest in Las Vegas?      

            Mr. SEDWAY. The next ---

            Mr. HALLEY. By the way, what year was it that you got the wire service?

            Mr. SEDWAY. 1942, I think.

            Mr. HALLEY. Under what name did you operate the wire service?

            Mr. SEDWAY. Will you refresh my memory? you have it there. I don't remember it. Honestly, I don't.

            I am not quite sure what year, but I did give it a firm name. I don't remember what it was.

            Mr. HALLEY. It wasn't the Nevada Publishing Co., was it?

            Mr. SEDWAY. No; I was—but we had—we called it—we gave it some combination, Nevada and something else.

            Mr. HALLEY. When did Siegel first get an interest in the wire service?

            Mr. SEDWAY. What wire service ? He had no interest in the wire service.

            Mr. HALLEY. At no time?

            Mr. SEDWAY. No, sir. The wire service never made any money.

            Mr. HALLEY. His only interest was in the books ; is that right?

            Mr. SEDWAY. That is right. Siegel came down very, very seldom to Las Vegas at that time. I ran the book. He had the major part. He put up all the money and I ran the book.

            Mr. HALLEY. What was your next business interest in Las Vegas?

            Mr. SEDWAY. My next business interest was in the Las Vegas Club. Mr. HALLEY. Will you describe that?

            Mr. SEDWAY. Yes; Mr. Houssels owned that club and he wasn't doing well with it. He wasn't entirely active himself, and I think he kept on losing bank roll after bank roll, and I thing he got a little tired of it. I talked with him—we were very friendly. We still are to this day. And I told him at that time that I thought I could get some people that—to bank roll it, put up the whole bank roll, and give him 50 percent.

            He says, "If you do, I will give you 10 percent."

            In other words, it would be 60.

            I called Mr. Greenbaum—you are familiar with him, aren't you ?— in Phoenix and told him about the deal, and we went in there and operated the club.

            Mr. HALLEY. What year was that?

            Mr. SEDWAY. 1943 or 1944. I don't know the year.

            Mr. HALLEY. In the meantime, what had happened to Corica in Phoenix? Was he with Greenbaum or was he alone?

            Mr. SEDWAY. Corica still had this service, and I was doing business with him. Of course, I ran into a lot of trouble with Ragen and Kelly, through Mr. Stearns, and they tried to break the contract because they thought that Corica didn't have any right to give me a contract. However, they ---

            Mr. HALLEY. What did they do to try to break the contract ?

ORGANIZED CRIME IN INTERSTATE COMMERCE        75

            Mr. SEDWAY. They gave an independent wire to Stearns.

            Mr. HALLEY. Where did he get his wire service, from where did the wire come?

            Mr. SEDWAY. Ragen. They were the service.

            Mr. HALLEY. Did it come direct from Chicago?

            Mr. SEDWAY. They just give him a direct wire, and by virtue of my contract I sued the Continental, and the Western Union, and the supreme court ruled in my favor.

            Mr. HALLEY. The Supreme Court of Nevada?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. What year was that?

            Mr. SEDWAY. I don't know what year. The records will show.

            Mr. HALLEY. Was it before Siegel's death?

            Mr. SEDWAY. Oh, yes.

            Mr. HALLEY. Some time before that?

            Mr. SEDWAY. Quite some time.

            Mr. HALLEY. What had led to your break with Stearns? You were on friendly terms with him originally; weren't you, the Stearns boys?

            Mr. SEDWAY. Well, on the service he thought he was—he was very nice about me going to the Frontier Club, but he tried to put all obstacles in my way not to be in business.

            Mr. HALLEY. When did you start depriving him of wire service?

            Mr. SEDWAY. I didn't deprive him of wire service. He went out and got—he got Ragen and Kelly, and they wound up giving him service direct.

            Mr. HALLEY. And he discontinued using your service?

            Mr. SEDWAY. He discontinued using my service, and then when the court ruled against him, I gave him service again.

            Mr. HALLEY. You did give him service again?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. Eventually, a time came when you did not give service to Stearns, is that right?

            Mr. SEDWAY. I don't remember when I didn't give him any service.

            The CHAIRMAN. At the time they had to steal the service.

            Mr. SEDWAY. That was after my contract ran out, sir.

            Mr. HALLEY. At that time who had the wire?

            Mr. SEDWAY. Connie Hurley.

            Mr. HALLEY. Connie Hurley had the wire?

            Mr. SEDWAY. Yes, sir.

            Mr. HALLEY. But you and Morris Rosen were associated with Hurley very closely, weren't you ?

            Mr. SEDWAY. Not with the wire.

            Mr. HALLEY. Perhaps we had better go along in order and get it straight.

            You were up to the point where you had gotten into, I think, the Las Vegas Club.

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What happened next?

            Mr. SEDWAY. Not the book, the whole club.

            Mr. HALLEY. You got the whole club?

            Mr. SEDWAY. Yes; gambling and everything.

            Mr. HALLEY. And you put a book in there?

            Mr. SEDWAY. The book was in there.

            Mr. HALLEY. Were you giving it wire service at that time ?

76        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. SEDWAY. Yes. The book and everything—we got 50 percent plus the 10 percent that I got, of the whole club, and put up the bank roll, and just went ahead and operated it successfully.            

            Mr. HALLEY. At that time how many clubs had books?

            Mr. SEDWAY. Just three.

            Mr. HALLEY. What were they, the Frontier----

            Mr. SEDWAY. The Frontier, Las Vegas Club, and the Northern Club.

            Mr. HALLEY. You had an interest in the Frontier and the Las Vegas; is that right?

            Mr. SEDWAY. I had an interest in the Frontier book. The Frontier was also a gambling club, and I had an interest in the Las Vegas Club gambling house.

            Mr. HALLEY. Mr. Siegel had an interest in the Northern Club?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. None whatsoever?

            Mr. SEDWAY. He severed his interests in the Northern Club at the time when we went into the Frontier Club.

            Mr. HALLEY. So the Northern Club was the one which you gave wire service to, but in which you had no interest whatsoever; is that right ?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. What club next got wire service in this city?

            Mr. SEDWAY. After the Frontier Club, I don't remember. I don't think—we went along that way, I think, for some time without another club getting wire service.

            Mr. HALLEY. Did others want the wire service?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Nobody wanted it?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Did anybody ask you for it?

            Mr. SEDWAY. Yes; the next club that got wire service—Stearns was dispossessed out of the Northern Club.. He went in with a group into the Rex Club, on Second and Fremont. It is now the El Dorado. They got wire service. Then the people that bought the Northern Club, they retained the wire that Stearns—they said they should retain it. So it made it four books then.

            Mr. HALLEY. Then you had four books?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What year was that, to your best recollection?

            Mr. SEDWAY. 1944, 1945, somewhere along there.

            Mr. HALLEY. At that time what were you paying for the wire service, still $900 a week?

            Mr. SEDWAY. Maybe more; it was flexible. I think between $900 and $1,200. We were supposed to pay that.

            Mr. HALLEY. What do you mean, $900 and $1,200?

            Mr. SEDWAY. The minimum was $900 and its conditions—if more wires were out, we were supposed to pay more money. The maximum, I think, was $1,200. I don't remember.

            Mr. HALLEY. What were you getting paid for the service by these various clubs?

            Mr. SEDWAY. We split it up equally.

            Mr. HALLEY. I understand that you split it equally between the four books?

ORGANIZED CRIME IN INTERSTATE COMMERCE        77

            Mr. SEDWAY. Yes.

            Mr. HALLEY. You did not attempt to make a profit on the wire service?

            Mr. SEDWAY. No, sir; we didn't make any profit. We had operators and expenses, and so forth, and it all balanced out.

            Mr. HALLEY. What club next got wire service?

            Mr. SEDWAY. After the El Dorado ?

            Mr. HALLEY. Yes.

            Mr. SEDWAY. You mean the Rex?

            Mr. HALLEY. Yes.

            Mr. SEDWAY. After the Rex, Mr. Stearns got run out of there.

            Mr. HALLEY. What do you mean by "run out"?

            Mr. SEDWAY. He got into a litigation, and they threw him out, and new people took that over and retained that book, and he, in turn, made a deal with Marion Hicks at the Savoy Club, and he asked for a book there, and he got it.

            Mr. HALLEY. So then you had five books?

            Mr. SEDWAY. Five books.

            Mr. HALLEY. How many books did you have when you finally gave up the wire service?

            Mr. SEDWAY. When I finally gave up the wire service we had—when I gave up the wire service in 1947 we had six.

            Mr. HALLEY. Which was the new one?

            Mr. SEDWAY. The Golden Nugget. No, I think there was one other one, out in North Las Vegas. It was a very small book.

            Mr. HALLEY. The Golden Nugget book was owned partly by you and Siegel ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. How did the book happen to go into the Golden Nugget ? Will you explain that?

            Mr. SEDWAY. I was in the Northern Club since 1942, and I was in there, and the Northern Club was owned by Mr. McAfee and his associates, but I did most of my business with Mr. McAfee. We were in there for 4 years, over 4 years, when Mr. McAfee decided to build the Golden Nugget.

            Mr. McAfee told me that when he did that we would have a book on it. At one time they decided—they were talking about closing the Frontier entirely and making an arcade out of it.

            However, it was kept open for a while as a gambling house, and then it was made an arcade, and we kept the book in there, which was worthless, but we got the book in the Golden Nugget.

            Mr. HALLEY. Who had the book, you and Siegel and who else?

            Mr. SEDWAY. I, Siegel, and Soloway and Houssels.

            Mr. HALLEY. What were your respective interests in that book?

            Mr. SEDWAY. Houssels had 10 percent. I had 25 percent. Soloway had 15 percent, and Siegel had the balance.

            Mr. HALLEY. How much would that give Siegel?

            Mr. SEDWAY. Fifty.

            Mr. HALLEY. What was the basis for his having 50 as against all of the rest of you having 50 together?

            Mr. SEDWAY. Because he had the major part of the Frontier Club. He had 66% percent of the Frontier and I had a third. He put up the original bank roll, and that is the way it was.

78        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. HALLEY. At that time did you and Siegel have interests in any of the other books in this city?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Just the Golden Nugget and the Frontier Club?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. At that time did Siegel have the wire service in Los Angeles?

            Mr. SEDWAY. I don't think so. I don't know for sure, but I don't think so. He may have. Outside of Las Vegas I don't know any of Siegel's business. He had business all over the country, I think, but I didn't know of it.

            Mr. HALLEY. You mean business all over the country ?

            Mr. SEDWAY. I think, but you never questioned Siegel about his business.

            Mr. HALLEY. What kind of business did he have all, over the country ?

            Mr. SEDWAY. I don't know what kind of business. I said he may have had business all over the country.

            Mr. HALLEY. You know he had it.

            Mr. SEDWAY. We all know, but Siegel wasn't the talkative type. If I wasn't interested in a business, he didn't discuss that business with me.

            Mr. HALLEY. He had bookmaking business all over the country, didn't he ? Don't you know that ? You don't it, do you ?

            Mr. SEDWAY. I don't know that he had bookmaking. Yes, I doubt it.

            Mr. HALLEY. He certainly had it in Los Angeles, didn't he?

            Mr. SEDWAY. In Los Angeles? No, sir; I don't think he had bookmaking in Los Angeles.

            Mr. HALLEY. Do you know of any gambling joints he had a piece of?

            Mr. SEDWAY. I heard that he had a piece of a gambling joint.

            Mr. HALLEY. Where?

            Mr. SEDWAY. I think he had a piece of the race track in Tiajuana.

            Mr. HALLEY. Anything else?

            Mr. SEDWAY. And I heard that he had a piece of the Clover Club, but I couldn't verify it, couldn't swear that it was so.

            Mr. HALLEY. Anything else?

            Mr. SEDWAY. No, not that I know of.

            Mr. HALLEY. How did you happen to give up the wire ?

            Mr. SEDWAY. My contract ran out.

            Mr. HALLEY. When did your contract run out?

            Mr. SEDWAY. The early part of 1947.

            Mr. HALLEY. What kind of a contract had you had?

            Mr. SEDWAY. Written contract.

            Mr. HALLEY. For how many years?

            Mr. SEDWAY. Five years.

            Mr. HALLEY. With no renewal clause?

            Mr. SEDWAY. No; even during the 5 years I had trouble holding on to it. They tried to--during the black-out--

            Mr. HALLEY. You mean when they closed out the track?

            Mr. SEDWAY. Closed out the race tracks in the country. Mr. Reagan and Mr. Kelly insisted that we pay the revenue until racing is resumed.

ORGANIZED CRIME IN INTERSTATE COMMERCE        79

            Mr. HALLEY. Did you do that?

            Mr. SEDWAY. We agreed on a deal and we did pay it, and when racing was resumed he sent his own man in and I had to work through his man in spite of the fact that I had a contract. They closed the original place because there was no racing, and then when it was reopened he opened his own place and sent his own man down there.

            Mr. HALLEY. What do you mean, "he opened his own place."

            Mr. SEDWAY. He had his own operator and his own—his own room where the service comes into and that it goes out to.

            Mr. HALLEY. Do you mean he brought it into Las Vegas and then sold it to you ?

            Mr. SEDWAY. No; the Western Union wire came in to me, and we, in turn, opened an office and put all these instruments in and sent it out by loud-speakers to the various clubs.

            Mr. HALLEY. But this is at a time when you were beginning to get it from another source than Continental, weren't you ?

            Mr. SEDWAY. No, no.

            Mr. HALLEY. You were no longer getting the Continental service, were you, from Ragen ?

            Mr. SEDWAY. Yes, I was getting it.

            Mr. HALLEY. Weren't you getting the Trans-America service then ?

            Mr. SEDWAY. No, I wasn't getting Trans-America service. I didn't have anything to do with Trans-America service.

            Mr. HALLEY. Didn't you ever get the Trans-America service?

            Mr. SEDWAY. Did I get it? I must have got it when Ragen didn't have his service in here. He had his service in here, but nobody bought his service when Trans-America came in.

            Mr. HALLEY. Who was handling the Trans-America service?

            Mr. SEDWAY. Hurley.

            Mr. HALLEY. Who was handling it in Phoenix?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. You were buying it from Phoenix, weren't you ?

            Mr. SEDWAY. I was buying it from Hurley.

            Mr. HALLEY. From Hurley. And where was he?

            Mr. SEDWAY. He is here.

            Mr. HALLEY. That is after he took over your contract?

            Mr. SEDWAY. He didn't take over my contract. He made a hew contract.

            The CHAIRMAN. Your contract with Continental expired and you went with Trans-America?

            Mr. SEDWAY. I didn't go with anybody.

            Mr. HALLEY. From whom did you purchase service under your contract?

            Mr. SEDWAY. From Washeo Publishing Co.

            Mr. HALLEY. At Phoenix?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Did the Washeo Publishing Co. become a Trans-America outlet? This is in 1946. before your contract expired.

            Mr. SEDWAY. I don't know. Not before my contract expired.

            Mr. HALLEY. Before your contract expired--

            Mr. SEDWAY. Trans-America—I think it was after my contract expired, wasn't it?

            Mr. HALLEY. No.

80        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. SEDWAY. My contract—when my contract expired, even before it expired, I had no more control over it.

            Mr. HALLEY. Why not?

            Mr. SEDWAY. Because, like I was—like I started to tell you, because after that black-out Mr. Ragen opened his own office. I had no more control over the operators or anything. They ordered their own man to manage it and their own operators.

            Mr. HALLEY. Did they have any customers?

            Mr. SEDWAY. They had all the customers. As a token, they worked through me.

            Mr. HALLEY. You mean you were buying it from Ragen direct?

            Mr. SEDWAY. I was buying from the local man—from this Elmer.

            Mr. HALLEY. Elmer ?

            Mr. SEDWAY. And then, when my contract ran out, I was out entirely.

            Mr. HALLEY. Who made the contract with Hurley?    

            Mr. SEDWAY. Somebody in Continental. I don't know who. I think Lynch, Bill Lynch.

            Mr. HALLEY. Made a contract direct with him?

            Mr. SEDWAY. I think so.

            Mr. HALLEY. Were you present at the hearings held in 1948 here in Las Vegas about the wire service?

            Mr. SEDWAY. Yes ; I was.

            Mr. HALLEY. Did you hear considerable testimony about the fact that you and Siegel seemed to be the people with whom people had to deal to get wire service ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. Would you care to comment about that, Mr. Sedway?

            What was the situation at the time of these hearings?

            Mr. SEDWAY. What was the situation at the time of those hearings?

            Mr. HALLEY. First, who had the wire service at that time?

            Mr. SEDWAY. Hurley had a wire service.

            Mr. HALLEY. Hurley had it. What was the relationship between one Moe Sedway ---

            Mr. SEDWAY. At that time Siegel was dead.

            Mr. HALLEY. And you had a Morris Rosen in there

            Mr. SEDWAY. That is right.

            Mr. HALLEY. Who is still your partner in the Flamingo?

            Mr. SEDWAY. The situation was this : We had the book at the Golden Nugget. While Siegel was alive, I think we paid $1,750 a month rent. Then after that, it was raised to $2,500, I think. That made it $30,000 a year. Then they called a meeting up at the Golden Nugget and they said they wanted $60,000 a year. We told them we had just given them a raise, but they said, "Well, either take it or leave it." And in the meantime one of their partners went back to Chicago to talk to Kelly to try to get the wire for themselves, so that they could—we wouldn't have a wire, so we wouldn't be in the Golden Nugget.

            However, they didn't think we would pay it, and we finally agreed upon a price of $50,000 a year.

            Mr. HALLEY. This was after Siegel died ?

            Mr. SEDWAY. We agree on $50,000 a year. We went along this way for several months and then this inquiry was caused to be made.

            Mr. HALLEY. Why do you think they were trying to put you out of business after Siegel died?

ORGANIZED CRIME IN INTERSTATE COMMERCE        81

            Mr. HALLEY. Was Siegel the boy they were afraid of?

            Mr. SEDWAY. I will tell you.

            Mr. SEDWAY. I think so.

            Mr. HALLEY. Could you give us some details on that, that Siegel was the boy they were afraid of?

            Mr. SEDWAY. I will tell you what happened. There was only one way they could get us out of the Golden Nugget or the Frontier Club, because Mr. McAfee—although we didn't have a lease, but we had a man's word, which goes a long way in our business.

            Mr. HALLEY. You had the wire, though?

            Mr. SEDWAY. And Mr. McAfee said that, as long as he had anything to do with the Golden Nugget., we will have a book. That was after we made the deal for the $50,000.

            Mr. HALLEY. No; I am talking about before you made it, while you still had Bugsy Siegel with you.

            Mr. SEDWAY. We had no difficulty when he was alive.

            Mr. HALLEY. You had no difficulty at all?

            Mr. SEDWAY. No, sir.

            Senator WILEY. Why were they afraid of Siegel?

            Mr. SEDWAY. I don't know.

            Senator WILEY. Who was afraid of Siegel?

            Mr. SEDWAY. They wasn't afraid. They just got along. Whenever he made a deal and he kept his word and they went along with him.

            Mr. HALLEY. Siegel represented a certain amount of muscle from Los Angeles, didn't he?

            Senator TOBEY. He was a. rat, wasn't he ?

            Mr. SEDWAY. A rap ?

            Senator TOBEY. R-a-t.

            Mr. SEDWAY. Maybe—I don't know.

            Senator TOBEY. He got what was coming to him, didn't he? Good thing, wasn't it?

            Mr. SEDWAY. I wouldn't comment on it.

            Senator TOBEY. I won't make you.

            Senator WILEY. You said someone was afraid of Siegel.

            The CHAIRMAN. Would you say that, while Siegel lived, you didn't have any trouble, but after Siegel got killed then they started to try to edge you out of the Golden Nugget, and the reason you didn't have any trouble before that was that they were afraid of Siegel?

            Mr. SEDWAY. I would presume that, being that we never had any difficulty before that, and certainly they don't have to worry about me. I am not going to do anything—which we have been out there, and I walked away from it, and that was the end.

            The CHAIRMAN. They were afraid of Siegel, so they didn't bother him, but they weren't so afraid of you; is that the thing?

            Mr. SEDWAY. I don't --

            The CHAIRMAN. Let's get on.

            Mr. HALLEY. Go ahead.

            Mr. SEDWAY. Anyway, in order to get us out, there was one way to get us out, and that is to cause an inquiry to be held and through that. inquiry to revoke our license. So they conspired

            Mr. RUYMANN. Whom do you mean by "they"?

            Mr. SEDWAY. People here in town conspired, and the district attorney wrote a letter to the Governor. First they tried to get the mayor to write the letter but I don't think the mayor wanted to write it.

82        ORGANIZED CRIME IN INTERSTATE COMMERCE

The district attorney wrote a letter that the situation in Las Vegas was unhealthy on account of the race-horse books, the race-horse wire.

            Mr. HALLEY. How long have you known Connie Hurley?

            Mr. SEDWAY. I have known him since I was in Los Angeles, maybe the latter part of—yes, while I was in Los Angeles. I didn't know him before that.

            Mr. HALLEY. Did you meet him through Siegel?

            Mr. SEDWAY. I think so; yes.

            Mr. HALLEY. He was one of Siegel's people; is that right?

            Mr. SEDWAY. He was friendly with him; yes, very.

            Mr. HALLEY. He was one of Siegel's gang, wasn't he?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. They did business together ?

            Mr. SEDWAY. Connie is not a gangster.

            Mr. HALLEY. What is Connie?

            Mr. SEDWAY. He has been a bookmaker all his life.

            Mr. HALLEY. And Siegel's business was bookmaking wasn't it? That was one of his businesses ?

            Mr. SEDWAY. Siegel's business was everything. I can't comment on what Siegel's business was.

            Mr. ROBINSON. At the time the conflict was going on with respect to the Golden Nugget and your rent was increased to $60,000--

            Mr. SEDWAY. To $50,000.

            Mr. ROBINSON. Well, it was upped to 60 and down to 50 thousand dollars?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. At that time wasn't Dave Stearns trying to get service for the Santa Anita Bar?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. Did you ever approach Dave Stearns and have any discussion with him on the basis of buying the Santa Anita Bar in order to get the service in there?

            Mr. SEDWAY. No, sir.

            Mr. ROBINSON. Did you suggest to him that the Frontier and the Santa Anita be combined by breaking through the wall?

            Mr. SEDWAY. I did not.

            Mr. ROBINSON. Weren't there discussions

            Mr. SEDWAY. I think Mr. Rosen did. You see, when we made this deal up at the Golden Nugget, one thing they made very clear to us, they made very clear to us that, "There is to be no more books on the street." They didn't want any more books.

            Mr. ROBINSON. Who said that?

            Mr. SEDWAY. The crowd up at the Golden Nugget, that meeting.

            Mr. ROBINSON. What meeting was this?

            Mr. SEDWAY. The meeting that McAfee and Cahlen was present, and Art Hamm.

            Mr. ROBINSON. Was this after Siegel died?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. What did you have to do with whether there would be books or not ? You said that Connie Hurley had it.

            Mr. SEDWAY. Connie Hurley was present then.

            Mr. ROBINSON. And you were there?

            Mr. SEDWAY. Yes.

ORGANIZED CRIME IN INTERSTATE COMMERCE        83

            Mr. ROBINSON. And Rosen ?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. And you and Rosen really ran the racing wire, didn't you?

            Mr. SEDWAY. No; I didn't.

            Mr. ROBINSON. Wasn't it understood that when anybody wanted wire service or a discussion of wire service that it was you and Rosen they had to deal with ?

            Mr. SEDWAY. They had to deal with Connie Hurley alone.

            Mr. ROBINSON. Who brought Hurley to Las Vegas?

            Mr. SEDWAY. Siegel did.

            Mr. ROBINSON. When did he bring him to Las Vegas?

            Mr. SEDWAY. Maybe he came here himself.

            Mr. ROBINSON. What did lie do here when he came here?

            Mr. SEDWAY. He got a book at the Boulder Club.

            Mr. ROBINSON. At the Boulder Club?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. Who gave him the wire service ?

            Mr. SEDWAY. When he first got it, I gave it to him.

            Mr. ROBINSON. You didn't mention that book, though. Is that a seventh book that there was?

            Mr. SEDWAY. I think so ; yes.

            Mr. ROBINSON. Did he have any partners in the Boulder Club?

            Mr. SEDWAY. I don't know.

            Mr. ROBINSON. Who persuaded you to give him a book at the Boulder Club—Siegel ?

            Mr. SEDWAY. Nobody. I think there was a book in there before, some time ago, and he made a deal with Goumond who he knew in Detroit.

            Mr. ROBINSON. And you agreed to give him the wire service; is that right?

            Mr. SEDWAY. That is right.

            Mr. ROBINSON. Did you continue to be a friend of his?

            Mr. SEDWAY. Whose?

            Mr. ROBINSON. Of Hurley's.

            Mr. SEDWAY. Sure.

            Mr. ROBINSON. You were a good friend?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. And Siegel was a good friend of both of you ; is that right?

            Mr. SEDWAY. That is right.

            Mr. ROBINSON. And Rosen, you were all friends? Rosen was a friend of yours, too?

            Mr. SEDWAY. Rosen wasn't here then.

            Mr. ROBINSON. He came on and off to Las Vegas?

            Mr. SEDWAY. He came to the hotel. I didn't see him very much.

            Mr. ROBINSON. Did you ever have a falling out? Did you ever become an enemy of Hurley's?

            Mr. SEDWAY. No.

            Mr. ROBINSON. You continued to be friends?

            Mr. SEDWAY. We are to this day.

            Mr. ROBINSON. When your contract for the wire service expired, Connie Hurley just took it over; is that right?

            Mr. SEDWAY. No; it was some time after.

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            Mr. ROBINSON. How did that happen?

            Mr. SEDWAY. I think he took over—he took over Trans-America first.

            Mr. ROBINSON. He took over the Trans-America service?

            Mr. SEDWAY. That is right; when Trans-America went out of business, then he got the contract.

            Mr. ROBINSON. He continued to be friendly with you ; is that right?

            Mr. SEDWAY. Yes.

            Mr. ROBINSON. And to consult you and Rosen about wire-service problems?

            Mr. SEDWAY. He didn't consult me about anything, sir.

            Mr. ROBINSON. Didn't the Stearns group approach you to settle their difficulty about the wire service?

            Mr. SEDWAY. He never approached me. I haven't talked to them in years. I haven't talked to Dave, anyway.

            Mr. ROBINSON. Do you know a Judge Shure?

            Mr. SEDWAY. Yes, I do.

            Mr. ROBINSON. Did he ever approach you? Did he approach you to straighten out the wire service?

            Mr. SEDWAY. A Judge Shure?

            Mr. ROBINSON. Yes.

            Mr. SEDWAY. I don't know what he had to do with it.

            Mr. ROBLNSON. Didn't you send him to the Stearns group?

            Mr. SEDWAY. No; I didn't.

            Mr. ROBINSON. Did he ever go to the Stearns at your request?

            Mr. SEDWAY. He might have gone, but not at my request. I think he might have talked with me about it, but I told him that I had nothing to do with it.

            Mr. ROBINSON. Didn't you tell him that you would never give him the wire service?

            Mr. SEDWAY. He was just a lawyer around here; a disbarred lawyer.

            Mr. ROBINSON. In any event, you never did give the Stearns group the wire service; is that right?

            Mr. SEDWAY. I didn't have it to give it to them.

            Mr. ROBINSON. And Hurley never gave it to them?

            Mr. SEDWAY. No.

            Mr. ROBINSON. Hurley continued to be very close to you?

            Mr. SEDWAY. We were friends.

            Mr. ROBINSON. You testified a little earlier that you had a meeting at which the group representing the Golden Nugget was there, and Hurley was there, and you and Rosen were there, and the Golden Nugget wanted to be sure there would be no more books in town; is that right?

            Mr. SEDWAY. That is what they asked.

            Mr. ROBINSON. Why did they ask you that?

            Mr. SEDWAY. They didn't ask me that. They asked that of Hurley.

            Mr. ROBINSON. And he was there in connection with your negotiations with the Golden Nugget? In other words, all one group operating together; isn't that right?

            Mr. SEDWAY. Oh, no. He had nothing to do with the Golden Nugget book. They asked him to give them the wire for the Golden Nugget, and he told them he couldn't give it to them, that he had

ORGANIZED CRIME IN INTERSTATE COMMERCE        85

already given a wire to the Golden Nugget, that there are people in the Golden Nugget.

            Mr. ROBINSON. In other words, he said if the wire didn't go to you and Rosen, nobody would get it; is that right?

            Mr. SEDWAY. He didn't say that, no.

            Mr. ROBINSON. Isn't that what it amounted to; there were already people there getting it?

            Mr. SEDWAY. Naturally, if he is giving it to people, he is not going to take it away from them and give it to somebody else.

            Mr. ROBINSON. It had to be you or nobody?

            Mr. SEDWAY. He is doing business with us.

            Mr. ROBINSON. Isn't it a fact that he meant that it had to be you or nobody ?

            Mr. SEDWAY. No, it isn't a fact. I am Sorry.

            Mr. HALLEY. Isn't that the plain meaning of what you are saying?

            Mr. SEDWAY. No, it isn't the plain meaning. If you are doing business with somebody in a location, and Somebody else comes along and wants that agency, and this man says, "Well, I already have somebody there; why should I give it to you ?" the chances are that if we were out he would give it to them. If we were out of the Nugget, that is.

            Mr. HALLEY. They had the power to put you out, didn't they ?

            Mr. SEDWAY. They had the power to put us—yes, they could have dispossessed us any time at all.

            Mr. HALLEY. He said he wanted to continue to give it to the people that were already there?

            Mr. SEDWAY. Mr. McAfee wouldn't put us out, because he gave his word. He was the one who stood up for us.

            Mr. HALLEY. How did Rosen get into that book at the Golden Nugget ?

            Mr. SEDWAY. He bought in.

            Mr. RALLY. What did he pay ?

            Mr. SEDWAY. Here is what happened. After Siegel died, Rosen came to town and was trying to get some buyers for the Flamingo. I think he talked to several groups. Finally, I told him that I had talked to Somebody and I thought I could get a couple of groups together, and I think we can buy it, if we could buy it reasonably, with a small down payment. So he says, "Well, you work it out, and when you get all set, go speak to the people."

            So I did. I talked to Sanford Adler and Charlie Resnick. They owned the El Rancho Hotel at the time. I talked to him and he was very much interested and lie said they would be interested but they couldn't take it all. So I called Mr. Greenbaum. He went back to Phoenix since—called him and he brought some people in. Mr. McElroy was brought in, and I got a man, a local man in town here, Mr. Mack. He put some money in, and we formed this group and bought the Flamingo for $3,900,000, with a down payment of, I think, around $500,000 or $600,000; I don't remember. The records are there.

            Then when Rosen—we got closer, and Rosen says, "Well, as long as I am going—" and Rosen, incidentally, liked the new set-up and he bought in. He put in 10 and then lie bought in 5 more.

            Mr. HALLEY. Ten what?

            Mr. SEDWAY. Ten percent. And then 5 percent more-15 percent.

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            Mr. HALLEY. What did he pay?

            Mr. SEDWAY. He paid what we all paid, except that for the first 10 he didn't have to put up any loan money.

            Mr. HALLEY. Why not?

            Mr. SEDWAY. Well, for the consideration that he was instrumental in making the—got all the proxies from all the other stockholders, and everything. So they agreed to sell it to him without a loan, the 10. But the five he loaned just like anybody else. Some people loaned more, some people loaned less.

            Mr. HALLEY. How much did he have to put up for the five?

            Mr. SEDWAY. For the five? Well, it was 10 percent capital and 90 percent loan.

            Mr. HALLEY. How much would the loan be, then?

            Mr. SEDWAY. I don't know what it would amount to ; say, on $500,000 or $600,000, if he had 5 percent, it would be $30,000, 10 percent would be ---

            Mr. HALLEY. Three thousand dollars?

            Mr. SEDWAY. Three thousand dollars for capital and $27,000 loan.

            Mr. HALLEY. So he did not have to put up $54,000 loan money on his 10 percent?

            Mr. SEDWAY. No.

            Senator TOBEY. After Mr. Siegel died, Mr. Rosen came down here, didn't he?

            Mr. SEDWAY. Yes.

            Senator TOBEY. And what had been Rosen's relations with Siegel before that?

            Mr. SEDWAY. Rosen had an interest in the old Flamingo, in the Nevada Projects Co., and when Siegel died he came down to sort of look after the business and see what could be done to salvage it. The place was in a very bad spot. It was ready to close if they didn't get a buyer. They weren't doing much business on account of all the adverse publicity that Siegel was getting during that time.

            Senator TOBEY. Rosen and Siegel had been pretty close in other deals in the past?

            Mr. SEDWAY. I don't know, but they were very close. As a matter of fact, Rosen's son just recently married Siegel's daughter, so the families were close.

            Senator WILEY. Who owned the 90 percent? Who had the interest in the other 90 percent?

            Mr. SEDWAY. Various stockholders. I bought a piece there, I think, at the time. I bought 5 1/2 percent.

            Mr. HALLEY. Who were the other owners ?

            Mr. SEDWAY. Mr. Greenbaum, Mr. Mack.

            Mr. HALLEY. This is Greenbaum, of Phoenix?

            Mr. SEDWAY. Yes; and Stanford Adler. He bought forty-some-odd shares, 48 or 49 percent.

            Mr. HALLEY. Adler eventually sold out; is that right?

            Mr. SEDWAY. Adler eventually sold out.

            Senator WILEY. How much do you own of it now ?

            Mr. SEDWAY. I own 7 8/10 percent.

            Senator TOBEY. Would you mind telling us what your net worth is now? What do you consider your net worth to be today?

            Mr. SEDWAY. I wouldn't know offhand.

            Senator TOBEY. A million dollars or more?

ORGANIZED CRIME IN INTERSTATE COMMERCE        87

            Mr. SEDWAY. No; I wouldn't know offhand. It is not a million dollars; no, sir.

            Senator WILEY. What income have you been drawing out of the place?

            Mr. SEDWAY. We draw no income at all.

            The CHALRMAN. What is your income per year? What was your income last year?

            Mr. SEDWAY. I invested in properties around here, and I have been very successful. I just sold a piece of property for $70,000, which I had a partner. I sold another piece of property for $6,500 which cost me $2,000. This piece that I sold for $70,000 originally cost me $14,000, and I still have three-quarters of it left, more than that, maybe four-fifths of it left.

            This I bought a long time ago. I am talking about highway property on the Strip. The property adjoining the Flamingo I have with. two associates. I have 50 percent, and they have 50 percent. We just sold 700-foot frontage for $70,000. We still have the difference to a half-mile frontage.

            Mr. HALLEY. When did you acquire that?

            Mr. SEDWAY. Acquired in 1944, and I bought it, I bought the whole thing for $14,000.

            Mr. HALLEY. You mean your 50 percent?

            Mr. SEDWAY. No; I bought the whole thing and then sold 50 percent of it to these two fellows for $25,000 2 years ago, or a little more. I sold it to them for $25,000, and since then it went up so that we sold just 700 feet for $70,000.

            The CHAIRMAN. What was your net income last year?

            Senator WILEY. What did you return?

            Mr. SEDWAY. I don't know offhand.

            The CHAIRMAN. Approximately how much?

            Mr. SEDWAY. About $30,000, $35,000.

            Senator WILEY. You don't get anything out of the Flamingo?

            Mr. SEDWAY. I get my room; I get my board.

            Senator TOBEY. This question isn't meant to be impertinent. We try to learn something in all these things. We are sitting down here,  and talking with other men who have been in the gambling business, and the point I make is a little deeper than that. You have been in this business all your life, and they are all playing the same games and they are all peeling off from it. You are growing rich, so to speak. The worst of it is that those of us who—I will speak it pretty clear : You don't contribute a thing in the way of production that makes real wealth. What you do is peel off in these games of chance. If you had your life to live over again, would you play the same kind of a game again ?

            Mr. SEDWAY. No, sir.          

            Senator TOBEY. We have a country we love, all of us, and you and I are a part of it; we are citizens. You simply wonder, after all, after the 60 or 70 years we live here, what it all amounts to after it is all said and done.. You are in cahoots with a lot of people like Bugsy Siegel, and you wonder whether it all pays or not or what it amounts to, and why men do these things. I look upon these people in my State of New Hampshire that till the soil and make $2,000

88        ORGANIZED CRIME IN INTERSTATE COMMERCE

a year as a lot richer than these people down here. They have got peace of mind and can look everybody in the eye.

            Mr. SEDWAY. Senator, you see what it got for me, three coronaries and ulcers.

            Senator TOBEY. What I am asking is this : What does it all amount to? Why do men play the game this way? What makes it attractive to them ? What is the matter with men ?

            Mr. SEDWAY. Just go into that type of business and you get into it and you stay in it.

            Senator TOBEY. You say you knew Lucky Luciano? He is a moral pervert and the scum of the earth, Lucky Luciano, and he is playing the game over there still in Italy.

            When decent men want to make a living, these men peel it off. They are rich; they are poor. They may have money but that is all they have got.

            Mr. SEDWAY. We don't get as rich as you think we do. This is hard work. I work pretty hard in this business.

            Senator TOBEY. But you got the rich end all the time. If you put the same talent you have got toward constructive things in life, producing something that makes real wealth and human happiness, men would arise and call you blessed.

            We find these men all over the country. What has come over the world? What are the dangers : Love of money and power. There are some finer things in the world.

            Mr. SEDWAY. You asked me if I would want to do it over again. I would not do it over again. I would not want my children to do it again.

            Senator TOBEY. I feel very earnest about it. It is a cancer spot in the body politic.

            Mr. HALLEY. What interests do you have today in any books in Las Vegas ?

            Mr. SEDWAY. None whatsoever.

            Mr. HALLEY. No books whatsoever?

            Mr. SEDWAY. No. I have given that up after that. I was offered books. I don't want to make any more money. I am looking to make a living. I don't know how long I am going to live. I have these heart attacks and the other difficulty, and I am 57 years old. I am older than you are, and figuring along and making a living for my family, and I am not making a lot of money.

            Mr. HALLEY. What are your present business interests? You have your 7 1/2 percent of the Flamingo?

            Mr. SEDWAY. And I have some property that I buy and sell. If I have a chance to buy a piece of property, I buy it and sell it, and that is the only way I can accumulate that kind of money, is to buy property and sell it.

            Mr. HALLEY. Aside from the Flamingo, do you have any interest in any other gambling operation ?

            Mr. SEDWAY. No, sir.

            Mr. HALLEY. Do you know whether Meyer Lansky has any holding in Las Vegas?

            Mr. SEDWAY. Whether he has any holding now?

            Mr. HALLEY. Yes.

            Mr. SEDWAY. No; I don't.

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            Mr. HALLEY. Did he ever have?

            Mr. SEDWAY. Yes; he did.

            Mr. HALLEY. What was that?

            Mr. SEDWAY. He was interested in the El Cortez Hotel.

            Mr. HALLEY. When was that?

            Mr. SEDWAY. 1945, I think.

            Mr. HALLEY. How long did he have an interest?

            Mr. SEDWAY. As long as we had it.

            Mr. HALLEY. Who had it?

            Mr. SEDWAY. Siegel was interested in it.

            Mr. HALLEY. Siegel and Lansky ?

            Mr. SEDWAY. Lansky

            Senator TOBEY. Where is that hotel?

            Mr. SEDWAY. It is here in Las Vegas. It is a commercial hotel.

            Mr. HALLEY. Was Marion Hicks there?

            Mr. SEDWAY. We bought it from Hicks.

            Mr. HALLEY. Who else had an interest?

            Mr. SEDWAY. Greenbaum, several others. There was a big group.

            Mr. HALLEY. In 1945 this was?

            Mr. SEDWAY. Nobody had a very big interest in any one of those places.

            Mr. HALLEY. Siegel, Lansky, Greenbaum, yourself—who else ?

            Mr. SEDWAY. All the men—Berman, several others. I don't remember who. You refresh my memory, and I will tell you "Yes" or "No."

            Mr. HALLEY. When did you sell out?

            Mr. SEDWAY. We sold out in 1945 or 1946.

            Mr. HALLEY. Did you have a casino in the El Cortez?

            Mr. SEDWAY. A small casino.

            Mr. HALLEY. Did you have a horse book?

            Mr. SEDWAY. No.

            Mr. HALLEY. Does Lansky still own any interest in the El Cortez?

            Mr. SEDWAY. No; I don't think so.

            Mr. HALLEY. How about Jack Lansky ?

            Mr. SEDWAY. No. He also was an associate with us, and then he bought it from us.

            Mr. HALLEY. He bought you all out?

            Mr. SEDWAY. Yes ; with another man.

            Mr. HALLEY. What is his name?

            Mr. SEDWAY. J. K. Houssels.

            Mr. HALLEY. Do the Lanskys have any interest in the Thunderbird?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. They stay there a great deal ; don't they ?

            Mr. SEDWAY. Not Meyer; Jake has been there.

            Mr. HALLEY. How long was Jake there, to your knowledge?

            Mr. SEDWAY. I think he was there up to a couple of weeks ago, when I saw him before I went to the hospital. I have been in the hospital now for 11 days. Two weeks yesterday is when I went into the hospital, and I think he was there before that. I don't know when he went in.

            Mr. HALLEY. Does Sadlow have an interest in the Thunderbird?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. Do you know Sadlow?

            Mr. SEDWAY. Yes; I do.

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            Mr. HALLEY. Does he have any other interests in this city ?

            Mr. SEDWAY. I don't know.  

            Mr. HALLEY. Do you know whether Adonis has any interest?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. Did he ever ?

            Mr. SEDWAY. I don't know offhand.

            Mr. HALLEY. Do you think he might have ?

            Mr. SEDWAY. I don't know.

            Mr. HALLEY. Have you ever seen Adonis in Las Vegas ?

            Mr. SEDWAY. Yes.

            Mr. HALLEY. What is the most recent occasion?

            Mr. SEDWAY. Five years ago.

            Mr. HALLEY. Did you ever negotiate with him to take an interest in the Flamingo?

            Mr. SEDWAY. No, sir; the Flamingo wasn't built then.

            Mr. HALLEY. Does Costello have any interest in Las Vegas?

            Mr. SEDWAY. Not that I know of. I am sure not, but I. can't say "No," but I am pretty sure not. He has never been here.    

            Mr. ROBINSON. Do you know of any interest that Aaron Smehoff, alias Allen Smiley, has?

            Mr. SEDWAY. I don't know.

            Mr. ROBINSON. Did he ever have?

            Mr. SEDWAY. I don't think so.

            Mr. ROBINSON. Wasn't he in the original Nevada Projects Corp.?

            Mr. SEDWAY. He may have been ; I don't know. I wasn't in it.

            Mr. ROBINSON. Did you have any conference here with Jack Dragna in the last year or 2 years?

            Mr. SEDWAY. Did I have a what?

            Mr. ROBINSON. A conference with Jack Dragna here in Las Vegas.

            Mr. SEDWAY. I talked to him when he was here.

            Mr. ROBINSON. He flew here to see you; didn't he?

            Mr. SEDWAY. I don't know if he flew to see me for any particular reason.

            Mr. ROBINSON. He flew here; didn't he?

            Mr. SEDWAY. I don't know whether he flew here or how he came here.

            Mr. ROBINSON. Where did he see you?

            Mr. SEDWAY. At the Flamingo. I think he stayed there.

            Mr. ROBINSON. How long did he stay at the Flamingo?

            Mr. SEDWAY. I don't know exactly.

            Mr. ROBINSON. What was the subject of your discussion ?

            Mr. SEDWAY. Nothing of importance.

            Mr. ROBINSON. Well, did he talk any business at all with you?

            Mr. SEDWAY. No, sir.

            Mr. ROBINSON. Did he talk about a possible investment in the Desert Inn?

            Mr. SEDWAY. No.

            Mr. ROBINSON. And he didn't talk about any business with you?

            Mr. SEDWAY. No, sir.

            Mr. ROBINSON. Did he talk about the wire service?

            Mr. SEDWAY. No, sir.

            Mr. ROBINSON. You had no discussions whatsoever about the wire service ?

            Mr. SEDWAY. No, sir.

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            Mr. ROBINSON. Do you know Hymie Levin, of Chicago ?

            Mr. SEDWAY. Do you mean the crippled fellow ?

            Mr. ROBINSON. The one who had the wire service in Chicago.

            Mr. SEDWAY. Isn't that the fellow who is so awfully sick?

            Mr. ROBINSON. Yes.

            Mr. SEDWAY. I met him when he was in bed.

            Mr. ROBINSON. Did you ever discuss the wire service with him?

            Mr. SEDWAY. No. I had nothing to do with any wire service outside of Las Vegas, as I recall.

            The CHAIRMAN. Mr. Sedway, why was Siegel killed, and who killed him?

            Mr. SEDWAY. I don't know, sir.

            The CHAIRMAN. He was killed in connection with the wire service. Exactly what was the controversy there?

            Mr. SEDWAY. I don't know. I wouldn't know if he was killed in connection with the wire service or any other reasons.

            The CHAIRMAN. Where was he shot?

            Mr. SEDWAY. He was killed in Beverly Hills, in the home of Virginia Hill.

            The CHAIRMAN. You don't think it had anything to do with the wire service; do you ?

            Mr. SEDWAY. I don't know. I wouldn't know whether it had anything to do with anything. I saw Siegel the night before. As a matter of fact, I very seldom came up to the Flamingo, because I was the chairman of the UJA for several years, and it was time to put on another drive, and I wanted to put a drive on at the Flamingo, which eventually I did, after he died.

            Senator WILEY. Chairman of what?

            Mr. SEDWAY. Of United Jewish Appeal of the State of Nevada. I have been chairman for some time. This last year I was so sick I didn't want to take it on, but I eventually took it on anyway.

            Senator TOBEY. You say you saw him the night before he died?

            Mr. SEDWAY. Yes.

            Senator TOBEY. He left for Los Angeles the next day ; did he?

            Mr. SEDWAY. Yes, sir. I had the regional agent for the UJA with us. I forget his name. I can get it. And we discussed it, and Siegel said that he thinks he can get Al Jolson down for the dinner, which would be a big thing for us.

            Mr. HALLEY. Sticking to this murder, did he say anything that might indicate that he was in fear of his life

            Mr. SEDWAY. He never said anything.

            Mr. HALLEY. Have you any idea of why he might have been murdered?

            Senator WILEY. Where was this conversation with you?

            Mr. SEDWAY. In the dining room.

            Senator WILEY. Up here ?

            Mr. SEDWAY. Yes.

            Senator WILEY. Then he went back?

            Mr. SEDWAY. Then he went back later that evening. I had left with this gentleman that came in from Washington to see me about the drive, and he went back, and he was supposed to call me the next day in reference to Jolson. He never did call me, and the next thing, late that night, is when it happened.

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            The CHAIRMAN. At the Flamingo did you have a commission man to lay off bets somewhere?

            Mr. SEDWAY. We have one there now.

            The CHAIRMAN. You have one. Whom do you have, Mr. Phillips?

            Mr. SEDWAY. No, sir; Mr. Gobaum.

            The CHAIRMAN. What is his first name?

            Mr. SEDMAN. Hy Gobaum.

            The CHAIRMAN. Where does he lay off bets?

            Mr. SEDWAY. They lay off bets. They bet all over the country.

            The CHAIRMAN. There are several telephones, and they just call Carroll, Erickson, or somebody in San Francisco and Los Angeles.

            Mr. SEDWAY. They are strictly a betting office. They don't book. They are strictly a betting office. They are betting.

            Mr. HALLEY. You mean Gobaum.

            The CHAIRMAN. How many commission men are there in Las Vegas?

            Mr. SEDWAY. I think there is one in the Desert Inn and one in the El Rancho. There is one in the Last Frontier.

            Mr. HALLEY. Is the one in the Last Frontier, Mr. Phillips?

            Mr. SEDWAY. I don't know.

            Mr. RUYMANN. What is your financial arrangement with him ?

            Mr. SEDWAY. They pay rent. That is all they do, Bill.

            Mr. RUYMANN. What rent do they pay ?

            Mr. SEDWAY. I think they pay $1,000 a month.

            Mr. RUYMANN. Don't you get any of the take ?

            Mr. SEDWAY. No. A lot of people come downtown to see him and we get business through them for the hotel.

            Mr. HALLEY. How do they operate? If you get somebody who wants to put a bet in your book and the bet is too high, do you put it over with them?

            Mr. SEDWAY. That has nothing to do with our book.

            Mr. HALLEY. Just how do they operate?

            The CHAIRMAN. Whose book does it have something to do with?

            Mr. SEDWAY. They have people call them and they sell their—

            Mr. RUYMANN. They call them from where?

            Mr. SEDWAY. From all over the country.

            Mr. RUYMANN. They call the bets in here?

            Mr. SEDWAY. They call the bets in and they call them and they get 2 1/2 percent and sometimes 5.

            Mr. HALLEY. Do they have to replace these bets in different places?

            Mr. SEDWAY. Yes; and whoever takes the bets for them pays him for it.

            Mr. HALLEY. Where do they place the bets ?

            Mr. SEDWAY. In various parts of the country.

            Mr. HALLEY. Do you mean they will get bets from people all over the country ?

            Mr. SEDWAY. They will get it from one bookmaker and sell it to another one.

            Mr. HALLEY. They operate as a sort of exchange, don't they?

            Mr. SEDWAY. It is a commission office, strictly. They make their money strictly off of the 2 1/2-percent commission.

            Mr. HALLEY. In other words, if a bookmaker in Miami Beach has a bet he doesn't want to handle, he will call them and they may find a bookmaker in Chicago or Los Angeles?

ORGANIZED CRIME IN INTERSTATE COMMERCE        93

            Mr. SEDWAY. If they don't find a bookmaker, they will pass them.

            Mr. HALLEY. Does the Flamingo book ever try to give them any book ?

            Mr. SEDWAY. The Flamingo book is a very small book.

            Mr. HALLEY. Suppose somebody came in and put down a very big bet that they wouldn't want to handle ?

            Mr. SEDWAY. We would just pass it.

            Mr. HALLEY. Why wouldn't you refer it to Gobaum ?

            Mr. SEDWAY. Gobaum is a betting office, not a ---

            The CHAIRMAN. You can lay it with somebody else?

            Mr. SEDWAY. They would probably give it to Gobaum himself, if there was enough time.

            Mr. HALLEY. He has got to have very fast phone service?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. How does he get that ?

            Mr. SEDWAY. He has several phones.

            Mr. HALLEY. Who arranges for these long-distance calls to go through so quickly ?

            Mr. SEDWAY. I don't know that they go through quicker than any other calls.

            Mr. HALLEY. He has got to get them through in a matter of seconds.

            Mr. SEDWAY. It only takes a minute to get any place.

            Mr. HALLEY. They have direct long-distance wire?

            Mr. SEDWAY. They don't have to go through the local office.

            Mr. HALLEY. Do they have a special operator handling their calls?

            Mr. SEDWAY. I don't know whether they do or not. They are called LD phones. They are not local phones. You pick up a phone and you immediately have long distance.

            The CHAIRMAN. If you want Chicago number such-and-such, can you get it like that?

            Mr. SEDWAY. That is right.

            Mr. HALLEY. What does the Flamingo pay for its wire service per week ?

            Mr. SEDWAY. I don't know exactly. I

            Mr. HALLEY. To your best recollection.

            Mr. SEDWAY. I would say around $200. That is not my department. All I do is take care of the dining room and the shows. I book all the shows, put on all the shows and book all the shows. That is all I have got dealings with now, is with actors. I have nothing to do with the gambling end or the booking end of it. As a matter of fact, I don't go into the office of Gobaum. I stay in bed 15 or 16 hours a day.

            The CHAIRMAN. Is that $1,000 a month he pays?

            Mr. SEDWAY. Around that. It might be $750. Don't hold me to those figures.

            Mr. HALLEY. And you think the hotel pays $200 a week for the wire service?

            Mr. SEDWAY. I think so; yes.

            Mr. ROBINSON. When you were in Los Angeles, were you acquainted with Big Greenie Greenberg?

            Mr. SEDWAY. No; I never knew him.

            Mr. ROBINSON. Did you hear of Big Greenie Greenberg in Los Angeles?

            Mr. SEDWAY. I heard of him after he was killed.

94        ORGANIZED CRIME IN INTERSTATE COMMERCE

            Mr. ROBINSON. Was Mr. Siegel indicted for that murder?

            Mr. SEDWAY. Yes, sir.

            Mr. ROBINSON. Did he ever discuss it with you?

            Mr. SEDWAY. No, sir.

            Mr. ROBINSON. Was he ever brought to trial on it?

            Mr. SEDWAY. Yes, Sir.

            Mr. ROBINSON. He was brought to trial?

            Mr. SEDWAY. Yes, sir.

            Mr. ROBINSON. In Los Angeles ?

            Mr. SEDWAY. Yes, sir.

            Mr. ROBINSON. Or Brooklyn?

            Mr. SEDWAY. What?

            Mr. ROBINSON. In Los Angeles or Brooklyn?

            Mr. SEDWAY. In Los Angeles, wasn't it?

            Mr. ROBINSON. Because of the death of Abe Reles he was not convicted—the principal witness in the case.

            Mr. SEDWAY. I think the case was after the defense rested. I think they asked for a directed verdict and it was given.

            Mr. ROBINSON. In the meantime the principal witness, Mr. Abe Reles, fell out of a hotel in Coney Island, is that correct?

            Mr. SEDWAY. I read that in the paper.

            Senator TOBEY. Did he fall, or was he pushed?

            Mr. SEDWAY. Police were with him in the room, so he must have fallen.

            Senator TOBEY. What about this man McAfee? Do you know him pretty well?

            Mr. SEDWAY. Yes.

            Senator TOBEY. What kind of a fellow is he?

            Mr. SEDWAY. A very nice fellow.

            The CHAIRMAN. What did the Flamingo make last year?

            Mr. SEDWAY. Offhand I wouldn't know.

            The CHAIRMAN. Well, about, your best judgment.

            Mr. SEDWAY. I would say, net after taxes, around $400,000—between $300,000 and $400,000. As we make it we throw it back in.

            The CHAIRMAN. We appreciate the testimony you have given us here.

            (Witness excused.)