Bugsy Siegel and “The Syndicate” Set Up Shop on the Las Vegas Strip

Las Vegas Sign and Bugsy Siegel

These days, the glitzy resort casinos that define Las Vegas in the minds of millions are largely owned by corporate entities. But despite the progress made by mega companies like Caesars Entertainment and MGM Resorts, the seeds of Sin City were planted by bold entrepreneurs who made their own gamble on the casino gambling industry.

Beginning in the 1940s, these pioneers realized the potential held by a dusty outpost in the Nevada desert by building the Silver State’s first casinos. In the first installment of an ongoing series, we’ll look at the life and times of Bugsy Siegel, the mobster turned manager of The Flamingo, one of the very first casino resorts on the Strip.

Brief Background and Biography of Bugsy Siegel

Long before he became the notorious leader of the Murder Inc. crime syndicate, “Bugsy” was born in 1906 as Benjamin Siegel in a low-income Brooklyn neighborhood. Like many children of European immigrants during that era, Siegel quickly decided to ditch school altogether in favor of joining a street gang.

A string of petty crimes soon ensued after Siegel joined a gang, as he and other Jewish youths threatened shop owners and shook them down for paid protection. Siegel eventually hooked up with Meyer Lansky to form a small-scale mob which expanded into bootlegging and other lucrative illicit ventures. By the tender age of 21, Siegel had already committed several gangland murders to “off” rivals, while palling around with mob legends to be like Al Capone.

Siegel’s proficiency with a pistol led him to become a sought-after hitman, a trade he flourished in as the leading figure of Murder Inc. Essentially, when mob families needed a professional killer to do their dirty work, Siegel and his underlings accepted the contracts in exchange for cash and favors.

Siegel’s skills weren’t limited to violence, however, as he also flourished in the murky world of underground gambling. By the mid-1930s, with his Murder Inc. activities bringing down “heat” from major Mafia crime families, Siegel’s boss sent him to Nevada a la Fredo Corleone in “The Godfather.”

Bugsy Siegel Mug Shot

His objective in Nevada involved furnishing illegal services by night to members of the work crew constructing the Hoover Dam. Drugs and prostitution reigned supreme, but with legal casinos providing for the workers’ gambling needs, Siegel spotted an opportunity to go legit.

Before he could capitalize on legal casinos in Las Vegas, however, Siegel was dispatched to California to extend the mob’s reach from coast to coast.

Once there, Siegel successfully gained control over the Golden State’s various illegal gambling enterprises in the name his bosses back east, in an ambitious scheme they dubbed the “National Crime Syndicate.”

In 1944, following a brief incarceration on charges of bookmaking and racketeering, Siegel realized that another change of scenery was in order. With that, he picked up stakes and headed to neighboring Nevada to make his biggest gamble yet.

Siegel Takes Over the Flamingo Casino and Starts the Strip

At this time, the beating heart of the Nevada gambling scene was located in downtown Las Vegas along Fremont Street.

Siegel initially sought to stake his claim Downtown by purchasing the El Cortez casino, but local gaming officials used his criminal background to block the acquisition. Forced to adjust on the fly, Siegel expanded the scope of his search to include areas that were technically outside of city limits, and out of the Las Vegas authorities’ jurisdiction.

Other entrepreneurs had the same idea, including a publishing magnate by the name of Billy Wilkerson. In 1945, Wilkerson was hard at work breaking ground on a property he envisioned as the biggest and brightest casino resort in town. Wilkerson’s project was centered on a plot of land a few miles south of Downtown along a largely deserted roadway which eventually became Interstate 15.

Vintage Flamingo Las Vegas Photo

At the time though, this undeveloped desert land held nothing but promise, plus a handful of “sawdust joints,” or old-school gambling halls that skimped on the frills players enjoy today.

Wilkerson’s dream was a full-scale resort combining a casino with a hotel tower, swimming pool, golf course, concert hall, and several other amenities previously unheard of in Las Vegas.

Unfortunately for him, those dreams soon drained Wilkerson’s bank account, and he found himself in desperate need of additional funding to the tune of six figures.

Enter the ambitious Siegel and his mob connections back on the East Coast… With no need to disclose his true identity or background, Siegel and his associates made Wilkerson an offer he couldn’t refuse. No, not that kind of offer, simply an infusion of a half-million dollars to turn Wilkerson’s casino visions into reality.

Of course, what began as a joint investment quickly turned into the shake down to end all shake downs. Enamored with the Las Vegas lifestyle and its lucrative nature, Siegel strongarmed Wilkerson out of the latter’s share in the casino project.

After naming the joint The Flamingo Hotel and Casino, inspired by a long-legged paramour who loved wearing pink gowns out on the town, Siegel set to work. Soon enough, thanks to investments made by Lansky and the boys back in New York, Siegel was spending exorbitant sums to complete the most glamorous casino in all of Las Vegas.

In December of 1946, having co-opted his partners’ expenditure of $6 million—nearly $80 million in 2020 when adjusted for inflation—The Flamingo finally opened its doors. Siegel had spent the last year promising his mob cohorts a tremendous return on their investment, owing to The Flamingo’s supposed appeal for high rolling “whales.”

Unfortunately for him, a rushed opening ensured that those whales never showed up…

Arrogance and a Bad Attitude Sever Mob Ties

Having spent countless thousands to hire celebrity entertainers, Siegel expected wealthy gamblers from around the Southwest would flock to The Flamingo.

But when the venue held its highly anticipated grand opening, only the casino and lounge were fully functional while the hotel tower was still under construction. Gamblers were greeted by the constant background noise of construction crews, and with nowhere to stay onsite, they inevitably left in favor of staying in downtown casinos where the hotel was operational.

The losses began mounting almost immediately, with The Flamingo’s casino intake failing to make up for the continued cost of hotel construction. Siegel’s temper flared with regularity, and he was even seen berating a family who had the nerve to complain about the noise.

Soon enough, as the flow of cash his investors expected dried up, the mob’s leadership began pondering possible explanations for the shortfall. Lansky, who by that point was based in Cuba to control the island’s thriving casino industry, began openly speculating about Siegel’s possible malfeasance in conversations with his criminal cohorts.

In his memoirs, fellow East Coast gangster Charles “Lucky” Luciano penned the following indictment issued by Lansky during a meeting of mob figures known as the Havana Conference:

“Bugsy had skimmed this dough from his building budget, and he was sure that Siegel was preparing to skip as well as skim, in case the roof was gonna fall in on him.”

Lansky based his suspicions on a rumor that Siegel’s girlfriend in Las Vegas was secretly funneling major amounts of money to a shielded Swiss bank account.

Whether those rumors were true was beside the point when it came to the mob’s code of “honor.” With Lansky abstaining from the vote, attendees of the Havana Conference voted to issue a contract on Siegel’s life.

Siegel, for his part, attempted to stall in hopes that The Flamingo’s hotel opening would generate the financial windfall he had long promised. After the hotel’s completion in early 1947, his vision for The Flamingo finally began coming to fruition. Well-heeled gamblers showed up from Los Angeles and back east, putting The Flamingo back into the black for the first time.

It was a classic story of “too little, too late” for Siegel, however, as the contract on his life remained in effect.

Bugsy Siegel Crime Scene

While enjoying a quiet evening at his home in Beverly Hills, the 41-year-old Siegel was assassinated via multiple gunshot wounds from a military grade machine gun. In an apocryphal tale, Siegel was said to have been shot directly through the eye, but autopsy documents confirm his eye socket actually suffered from exit wounds.

In any event, Siegel’s life and death were used by author Mario Puzo in his book “The Godfather” to create the greedy casino owner character Moe Greene. To this day, mafia aficionados refer to a gunshot through the eye as the “Moe Greene Special.”

Siegel’s Legacy Lives on in Casino Mega-Resorts

While he may not have lived long enough to see The Flamingo flourish, Siegel’s vision for a flashy home for high-rollers lives on today.

After the new ownership group led by fellow mobster Moe Sedway took over, The Flamingo soon became the most profitable casino resort in Sin City. Topline entertainers like Sammy David Jr. and Lena Horne headlined the nightly shows, and Las Vegas’ first property-wide air conditioning system left guests gambling in comfort day and night.

Sahara Casino Las Vegas

Six years after opening its doors, The Flamingo was followed by a second major casino resort on the Strip when Sahara debuted. Tropicana (1957), Tally-Ho (1963–now known as Planet Hollywood), Caesars Palace (1966), and Circus Circus (1968) eventually rounded out the Strip’s casino lineup modern gamblers know and love.

But without Ben “Bugsy” Siegel betting it all on The Flamingo, the world’s leading casino destination along the Las Vegas Strip may have never existed at all.

Conclusion

The sanitized corporate casinos of the modern era may not like to admit it, but their place in Las Vegas history originated with an uneducated gangster who grew up on the streets of Brooklyn. By realizing that casinos could become all inclusive centers for every form of entertainment—dining, dancing, and hob-knobbing with celebrities—Bugsy Siegel revolutionized the industry.

While he wound up meeting his end in grisly fashion, and never had the pleasure of seeing The Flamingo strut its stuff, Siegel’s conception of a full-scale casino resort remains the template in 2020. And fittingly enough, while competitors from Las Vegas “golden age” have fallen by the wayside, The Flamingo’s bright pink façade still shines brightly amidst the Strip’s skyline.