Bill Friedman Author
Bill Friedman Author

about the author

the Research

section 2

THE CONDUCT OF THE HISTORICAL RESEARCH PROGRAm and THE LEGAL RAMIFICATIONS OF HANGING OUT WITH HOODLUMS

 

from the Preface of 30 Illegal Years To The Strip by Bill Friedman

 

This biography about the author describes the unparalleled, historical research program that took me inside organized crime and led to this book. It also resulted in my careers in Las Vegas Strip casino management and worldwide casino consulting. The unusual circumstances surrounding them were filled with seemingly impenetrable roadblocks that were opened up by unexpected opportunities.

 

My fascination with Nevada gambling began at age 7, when my parents started taking me on summer vacations to Lake Tahoe and the Las Vegas Strip. I was required to stand at a distance behind the players at the twenty-one tables to study the proficiency of the dealers and the gambling action. The first time I watched, I knew I wanted to be a twenty-one dealer when I grew up.

 

At age 21, I spent my summer break from San Francisco State University working in downtown Las Vegas as a dollar-an-hour shill at the Fremont Hotel, which had a large clientele of high-rolling players. Shills gambled with house-supplied money at the tables to make the casinos seem busy during slow daytime and evening business periods.

 

The next summer, I began my career as a twenty-one dealer at the new Sahara-Tahoe Hotel at Lake Tahoe. I worked Friday through Monday at the casino and completed my college degree by attending classes in San Francisco every Tuesday and Thursday. I then attended graduate school at the University of Nevada, Reno (UNR), while continuing to deal at South Shore four days a week.

 

After work, I often had a nightcap at the bar with one of the table-game executives who worked behind me. I listened intently as they described their incredible career experiences. Most of these men had previously worked in the wide-open illegal casinos found throughout the country during the 1930s and 1940s. Then around 1950, local political reform movements and law-enforcement closed down almost every illegal casino in the country. The unemployed executives and dealers moved to Las Vegas because positions were readily available for experienced employees in the rapidly proliferating gambling resorts along the Las Vegas Strip and also in Reno and Lake Tahoe.

 

These men had lived very different lives than I had been exposed to in the genteel, middle-class, nonviolent world I was brought up in. Most had grown up in poor neighborhoods and had grammar-school educations at best. But they had very savvy street smarts and keen perceptions about people. Although they had worked in illegal operations that bribed the police to avoid arrest and closure, the police offered them no protection for their large cash bankrolls. These illegal casino operators had to defend themselves from robbers and also from gangs trying to take over their territory. They were fiercely independent individualists, the last of the frontiersmen, standing alone against a tough predatory underworld.

 

I was so intrigued by these men’s stories that I wanted to learn more about their backgrounds, life in the illegal-casino world, and how gaming control had developed in Nevada. It was a new and

unique form of law enforcement that existed only in Nevada. I spent my limited free time in UNR’s library searching old newspapers for articles about the development of the industry. I realized the mass of available material on the subject demanded a full-time effort, but I had no way to finance a serious chronicling of this information to satisfy my curiosity or to write a book about it.

 

Then the Vietnam War got underway, and I soon received my draft notice. I declared conscientious-objector status and the FBI conducted the required investigation of my life to determine if I warranted this classification. Then the Selective Service System approved my application. It typically ordered conscientious objectors to spend their two years of alternative service at a hospital near their home cleaning bed pans for about $300 a month. But the FBI investigation and Selective Service interviews about my background had brought my research interests to light. It turned out that I was the only academician who had developed close personal relationships with members of organized crime. This was especially impressive at that time, because it was years before the FBI would insert an undercover agent into an organized-crime gang.

 

As a result, I was introduced to Joseph D. Lohman, Dean at the School of Criminology at the University of California, Berkeley. He was a highly-respected criminologist, who proposed to take advantage of my trio of assets – personal contacts in the underworld, a passion for casino gambling operations, and a university degree in social psychology. He proposed to transform my research dream into a structured sociological historical study about the development of organized crime, its impact on Nevada’s casino industry, and the creation of Nevada gaming control. To encourage the former illegal gambling operators to cooperate and to demonstrate my research was not a law-enforcement sting, every question I would ask was about events at least 10 years old, so participants would know their answers were well beyond the statute of limitations for criminal prosecution.

 

Since Dean Lohman’s proposal would potentially expand law enforcement’s and academia’s limited knowledge about the structure and operation of organized crime, the Selective Service System quickly approved this study. It ordered me to report for two years of alternative service with the School of Criminology at Berkeley. Dean Lohman directed me to read relevant archived newspapers and other documents in UNLV’s library, interview gaming-control authorities, and hang out with hoodlums for interviews. Between mid-1967 and mid-1969, I enjoyed the glorious wonders of Las Vegas on my $300-a-month salary. I completed my two years of service and received an honorable discharge from the Selective Service for majoring in hoodlums. Yet I had barely tapped the surface of the available information. So during the next 47 years, I devoted every spare moment to finishing my research and writing this first book in a planned historical series about the Nevada gambling industry. My personal life-long research is in memory to Dean Lohman who was a very special mentor. (The Selective Service draft-order and discharge documents are presented in the Selective Service navigator)

 

After discharge, I spent the next 10 years making a living as the leading after-lunch and after-dinner speaker for Las Vegas convention groups. About once a week, I taught groups of 50 to 5,000 people how to play the table games, or I told them intriguing historical inside stories about the Nevada casino industry. I also taught the pioneer course Casino Operations and Management for the College of Hotel Administration at the University of Nevada, Las Vegas under Dean Jerome J. Vallen. I wrote the book Casino Management. It became the seminal work in the field, and the New York Times reported it was the most expensive required reading at Cornell University’s School of Hotel Administration. All these endeavors provided a livable income and left me with five days a week full-time to continue my research.

 

I did not attempt to conceal my feelings like a reporter or a psychiatrist. On the contrary, I was a young man captivated by the subject and intently searching for the truth, and I was very open about my opinions and beliefs. My candor was important because law-enforcement policies, judicial decisions, and Constitutional interpretation in the period I was studying were very different from the times I lived in. Many times, Nevada’s top gaming and law enforcers, as well as the hoodlums who owned and operated the casinos, told me, “If you don’t get back into our world, you will never understand why we made the decisions we did and why anything happened.” They were right!

 

Learning about their world caused a major life and career adjustment. An encounter I had with Benny Binion, one of Nevada’s premier pioneer casino operators and marketers, best describes how I made my occupational decisions. Benny was an early supporter of my research, and he advised me on my career like a father figure. Because I was developing so much knowledge about the operation of the industry and I was getting to know top executives in the limited number of casinos, in 1970 I was offered executive positions by two casinos that would have paid me far more money than I had ever dreamed of earning. I turned both down because I would have had no time to continue my research. My goals and values had changed from my youth, when one of the attractions to Las Vegas was the affluent lifestyle. One day at lunch, I told Benny about these two opportunities and my decisions to pass on them. This older Irish gentleman stared at me intently for some time, shook his head, and said, “You are the only Jew I have ever met who absolutely does not give a damn about money.” Then, as now, my consuming passion for knowledge about this fascinating industry and these remarkable men directed my career decisions.

 

Then, seven years after discharge by the Selective Service System, an opportunity came along that was too enticing to pass up. Summa Corporation, owned by tycoon Howard Hughes, appointed me to be the only person to ever simultaneously manage two casinos on the Las Vegas Strip - the Castaways and the Silver Slipper. Both positions required I apply for my first state and county licenses as a key employee. This was a crisis situation because the Nevada gaming control authorities denied every one who had any association with organized crime figures, unless these were minimal and accidental. In the few cases they approved, they prohibited any further contact as a condition of licensing. If my applications were denied, it would have ended my career in the casino business, and if I were restricted from further contact, it would have ended my historical research. This was a scary prospect because I had spent my whole career researching hoods to understand what makes them tick and why they do what they do.

 

Fortunately, I had interviewed the key state gaming control officials extensively throughout my research and kept them posted on who I was seeing but not what I was learning. I also discussed my research with Las Vegas Metropolitan Police Department detectives, including its Organized Crime Bureau. The licensing authorities and their investigators knew me well and wholeheartedly supported and contributed to my academic research into the underworld’s involvement in Nevada. They wanted me to complete my history in my spare time, so they encouraged me to continue my research. Thus, I became the only Nevada gaming licensee who was allowed to associate with hoodlums as long as they were associated in some way with the casino industry or Las Vegas.

 

I quickly transformed the Castaways and the Silver Slipper from long-time money-losers into top Nevada profit makers. When the figures came out for my third month of operation, Summa’s leaders called me to a corporate meeting to tell me that the month’s profits were greater than any of them had imagined possible. Except for months in which the players had big wins, the profits went up significantly every month for the next twelve years. In the process, I achieved the highest average win per slot machine in Nevada. Under my leadership, the cash flow from these two old, smaller casinos financed the entire corporate structure of the world’s largest privately-owned company.

 

At the first corporate meeting, Frank Morse, who was Summa’s second in command and the man to whom I reported, pulled me aside because he said the corporate leadership wanted to inform me who my friends were. He said, “We told you up front that you were an experiment for us. We knew you had never supervised anyone or managed anything, when we made you president. Your five references were reputable professional people who were good character references, but we knew none of them knew anything about the gaming business. We still did our due diligence and talked to them. We also went to the two biggest gangsters in town for their opinions, because we know they know the most about this business. We think you should be aware that Summa has had tens of thousands of applicants over the years, but Benny Binion gave us the finest reference that we have ever received for anyone, and Moe Dalitz was just one step behind. Both were confident you were ready. You can thank them for making this job available.”

 

I was already grateful to both Benny and Moe for having made all their key executives available to assist my historical research for the previous decade. The vast knowledge and experiences they had shared with me had prepared me well for the many challenges I faced in turning both casinos around. My professional and business careers were truly made possible by my penchant for associating with hoodlums. It should be noted that Moe Dalitz is a key figure in this book because of his large Prohibition operation, illegal casinos, and great influence in organized crime nationwide, before he built two major Las Vegas Strip gambling resorts.

 

I operated the highly-successful Castaways and Silver Slipper casinos for 13 years before they were sold because of Hughes’ death. (Nevada law requires that all assets be sold when the deceased has multiple heirs.) The two casino-sale contracts gave me complete unfettered control over the operations for one more year to produce additional profits for Summa. Despite assuring generous severance packages to the employees who stayed until the closings, both casinos came close to producing record profits because the regular tourist and local players who visited each one did not search for a new home until we threw a huge goodbye party and closed the doors at their favorite hangout. The Castaways’ property was developed into the first megaresort, the Mirage. The Silver Slipper was purchased by the adjacent Frontier Hotel to become another megaresort, but the state appropriated much of the Silver Slipper’s property for a freeway.

 

Since then, I have worked as a consultant to casinos across the country, including being licensed as a key casino executive in five states. At the same time, I consulted to casinos in countries around the world, including almost all that catered chiefly to high-rollers. Between consulting assignments, I continued to focus on my historical research, except when I wrote another business book, Designing Casinos to Dominate the Competition. It was published by my alma mater, UNR’s Institute for the Study of Gambling and Commercial Gaming.

 

Two decades after being licensed in the heart of the Las Vegas Strip at the Castaways and Silver Slipper, I was involved with another unique licensing situation. This resulted when I signed a five-month contract to manage and turn around the once profitable 1,000-room Oasis Hotel and Casino resort, with its world-class Arnold Palmer golf course. It was located in Mesquite, Nevada, 85 miles northeast of Las Vegas near the Utah border. The landlord was Si Redd, who had created the giant slot manufacturer IGT. As landlord of the Oasis, he had taken over the operation from the lessees who had defaulted, and he called on me to save the operation because he was well acquainted with my great turnarounds of the Castaways and Silver Slipper. I replaced the general manager who had held the only license at the Oasis after the lessees had departed. The Gaming Control Board waived the legal requirement for me to apply for a license upon taking the position because the investigation could not have been completed during my five-month tenure, and the Board did not want to waste everyone’s time for what would be mere window dressing. As the Board told the Oasis’ attorney, “We already know everything about Friedman, and we are comfortable with him.” This decision was practical and justified, but it resulted in an irony. Nevada has allowed just this one casino to ever operate without anyone holding a state gaming license, not an owner nor a manager, and it just happened to be controlled by the man who was known for his relationships with hoodlums.

 

I have lived a large portion of my life in a unique twilight realm that allowed me to seamlessly move back and forth between two separate opposing worlds that loathed each other. I was successful in dealing with both the law enforcers and the criminals because, until this book, I never repeated anything I was told. Everyone in the underworld knew I never reported about my research interview findings or personal discussions. Everyone in the overworld knew I never participated in a felony and also never revealed anything about their investigations and suspicions. The gaming controllers also knew that my casino operations scrupulously followed all regulations, and I worked closely with agents to address their occasional concerns.

 

During this long research project, I have searched through 123,000 old newspapers, 200,000 pages of FBI reports, legislative hearings, court records, university oral histories of pioneers in Nevada’s gambling industry and political leaders, and numerous books and magazine articles. After combining all this data into source material, I conducted in-depth, comprehensive interviews with almost 600 people who distinguished themselves by making important contributions to the Nevada casino industry - resort owners, hotel and casino management and marketing executives, organized crime figures, attorneys, bankers, accountants, gaming control and law enforcement officials, political leaders, and newspaper investigative reporters.

 

Since closing the Castaways and Silver Slipper 25 years ago, my consulting and writing pursuits have given me more than half of each year to devote full time to my historical research. It has been a wonderful odyssey exploring the casino pioneers’ unique and intriguing lives, struggles, and achievements along with the economic, political, and legal context in which they occurred. Now it is time to tell their astonishing stories. I hope you enjoy sharing their adventuresome lives as much as I have.

 

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© Bill Friedman, 2015

Bill Friedman

 

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© Bill Friedman Author, 2015