Philadelphia Daily News from Philadelphia, Pennsylvania on March 31, 1965 · Page 25
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Philadelphia Daily News from Philadelphia, Pennsylvania · Page 25

Philadelphia, Pennsylvania
Issue Date:
Wednesday, March 31, 1965
Page 25
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PHILADELPHIA DAILY MEWS 5 .WEDNESDAY, MARCH 31, 96S 25 Gamblers' Money Las Vegas Draws to Inside' Real Estate Dea Third in a series of 12 articles excerpted from "Gamblers.' Money," revealing study of the impact of Las Vegas money on the American economy. By WALLACE TURNER The Stardust Hotel has 1300 rooms, making it by far the largest among the Las Vegas places. This space to store the customers may in part account for the great winnings that the casino reports. It has swimming pools two, as we shall see and even a convention hall next door for small groups, and the nudes in the "Lido de Paris" show, and everything else including acres of parking space. But it had no golf course. The thing to do was to get one, someone must have reasoned, before it's too late, before the decline sets in and we have to spend great gobs 01 money to turn it around. So they got one from the Teamsters pension fund. It serves two purposes the guests at the Stardust can use it, and the people who bought houses in the Paradise Palms subdivision also can use it. Who knows? Maybe the clubhouse will even make some money. A BEAUTIFULLY PRODUCED BROCHURE put out by the Stardust makes it plain that the place is really the combination of two places the old Stardust, which has been a money-maker almost from the beginning, and the former Royal Nevada, one of the tAity - BOOK SERIAL K liquid and easily packed again to move on if necessary. THE GAMBLERS' real estate development operation is directed from a small, crowded building at 3335 Cinder Lane, Las Vegas. This building is about as far from the Strip and from the beauties of Las Vegas as one can get. It stands at the edge of the desert, across the railroad tracks, and has small industrial plants and a meat-packing house for neighbors. Why on earth out here? No visible explanation appears at the scene. But a look at a map of Las Vegas shows that a plan resources of intelligence and foresight and courage. No one who has studied their lives can help but wonder at the chance that took them out of the slums and turned them into millionaires as gamblers. For most of them came from humble homes in the big cities. They started life with not very much. As Moe Dalitz said to Sen. Estes Kefauver: "Well, 1 didn't inherit any money. Senator." Thus it was with most of them. As young men these gamblers had training in running the illegal gambling places in the alleys of the big cities. They few Strip places ever to go broke. The former casino, showrooms and restaurant of the Royal Nevada have been turned into a convention center, called the Star dust Auditorium, for the use of groups wanting to meet in easy reach of the gambling tables. This provides an added lure for the Stardust, and also serves the purpose of keeping an aggressive and competing deal THE DESERT INN, with its Olympic-size swim pool, was snlrl in fair-srivinff rpal pstatp rlpal will unload it for a staggering Such discoveries lire interest-uhirh Clark Cnuntv has had tnlsum 10 some omer oeveioper , ned super highway will bypass j learned things there that no one the city and run near the block jacnes ai narvara mismess of property on which is located , School. the Paradise Homes headquar- For example: One has no confers. A.cloverleaf for entrance tract wlfh ,he district police can and exit to the freeway will beitain whereby one is obligated to nearby. Pay "xm ?500 8 nionth and he Someday, the Paradise Homes' is bI'gated to violate his oath stockholders will either build a!to the end that lhe gambling great business property on thehouse Ec,s protection from raids. site of their oresent modest lcsai agreement couia pn headntiartprs hnilrfinf nr thev.'duce management out of the old Royal Nevada property. ing, cause trouble, arouse suspi- pay on its bonds in the last few cions, but until the recent years years. of strengthening control of gam-l it has been estimated in Las bling by the state of Nevada, Vegas that this alone will cost these discoveries never meant the taxpayers $400,000 more anything. Sthan they need to pay. THE DESERT INN group s u r 1 v t 1 u r rnr win uc uuuuiuk tiuu- , , . f, , , , V mill .1 1.1 11 Course and the Stardust Country I dreds of houses on lese The Stardust books guests into the Desert Inn properties in . flub ..J"Atl surrounding the course and,tHpn: Observers will talk about blind luck and bemoan that rich get richer. But the truth is that the smart get richer the careful planners make the big money. INSIDE THAT SMALL office building, the space was crammed with busy people and the bustle of a big business opera- the line of rooms behind Auditorium and also uses eileaseback arrangement that per- the mitted such great tax savings. swuuiuiug fwi:So for all practical purposes, there. The Stardust, meantime. I the Dcsert inn cr0wd controls continues to fill up its lines of tne Stardust hotel, as well as motel-like buildings which feed the Stardust casino, and oper- piiests into the rasino dinin? , n . . ... u. r. rooms, and Dast the s ot m-L- help sell a new housing develop . - cit 11111. 1 kin, ..i L . .i. ,'ment. 1 cut mere nas oeen conunuaii , THE GAMBLER who envis- undercurrents of talk that the) Thls 18 the nterwood. Inc., ioned this place the original control by the Desert Inn inter-jPrJect- Starrlusf as Tonv Cornero tests merely covers a control of; Rumors of this one were float- 13 WllllCUJ uic wiKiiit- j tion has moved on into an even ., , more 1 11 r r a t i V p nronosition There Will be 170 "golf course where thev havp nersnaded the lots" alone. and while n0 P"ce nark rnnntv Rnard nf rnmmu.i has been publicized for these sioners to finance a golf course !the onfs . the Stardust course for them, a golf course that will, started at 10-000 each- Ihis would mean a minimum for these lots alone of $1,700,000 all for the Desert Inn group, which retains ownership of the building lots, not for the county the same who ran the gambling;the Stardust by notorious under- ! world figures. j Reports about hidden interests continually crop up in many of ing around in Las Vegas in the summer of 1963. Opposition began to grow. But at its last meeting of the year, the Board! acres ekewhere to develop for a nt it gun iisuiac. uui luia wouldn't have made any money for the Desert Inn. Pictures of Paradise Homes projects lined the waiting room walls. Secretaries moved about onskiy and engineers carrying blueprints hurried in and out the door. Mervyn Adelson was away, but Irwin Molasky was in, a short, balding man in his late forties. His actions and attitudes indicated a high level of competence, but none of the flash- which ultimately pays for the! ing sparks that would indicate golf course. authorship of some of the in- The county already owned 160; spired maneuvers made by the boats at sea off the California shore in the 1930's. His true name, incidentally, was Antonio Comero Stralla. (the Las Vegas casinos, and fre- After a career that included quently are accompanied by k r:, inr iwiiiimrin tiMsoirJsonie semblance of evidence. ing, rum-running, and finally! Proving them is another thing, agreement had been reached! In'tial stories indicated that" gambling boat operation he Even when they are well dem-privately before that meeting t h e M, interwood development ' !!m: i ' Ln.trated thev frem.entlv result1 even started. would be worth more than $20 i a uic w xas icgas nucu auii - ' - " - 1 Wing was legalized. He even in court Decisions mai ao mue THE deal APPEARS to be of Commissioners voted to go ahead with it. I There were indications that Paradise Homes management. He said that he and Adelson moved to Las Vegas from Los Angeles in 1952. They went into a situation in which the police in uniform would come to eject a troublemaker, but at the same time would be blind to the dice tables. So the young gamblers' business training included courses in how to conduct business without the benefit of legally binding contracts. THEIR EXPERIENCES taught also them to build reputations for reliability amoni: their own kind. If the pledged word is the only guarantee of performance, then a reputation for honoring the pledged word is valuable beyond diamonds and a reputation for double-dealing is ruinous. If the gambler had an arrangement that gave him control of some particular operation in some part of the city, or county, or Nation, he had it only so long as he could hold it If another operator came in and by force or by maneuver .shoved him out, the prize fell to the new man. Those were hard lessons learned in the bootlegging and died hunched over a dice table. more than slap the wrists of unusuany lucrative to the group Initial stories indicated that1 business together in Las Vegas. i'"'' And when the time came fir million in housing. and soon became acquainted ith the Desert Inn group.' ,-We were socially connected," the gamblers and bottleggcrs to come in from the outer dark- The developers have the in- from the gambling casino? and ducemefnt of a " e. r b, g0lf ness and assume a not very good for the county. Cornero visualized the Star-ithe men whose names are on dust although his first name, the license. for it was the "Starlight." ODDS AND ENDS of informs- Under its provisions, the gam- . "ul ' "V "a,.c After many incredible adven- tion crop up through the yearsjblers and their associates will. av0l?Jfa tne Prooiems of operat- tures with the underworld and I tourse 10 use in meir sales pro motion; but they will have with the Securities and Exchange Commission, he built the place almost. He died of a heart attack at the Desert Inn before he got it completed. Cornero had collected about $6 million to build the place, had it only 70 percent completed, and owed contractors and suppliers about $4 million. It would take another $3 million to finish it, and Cornero was dead. AT THIS POINT John (Jake the Barber) Factor came on the scene with the money to finish the Stardust. He took over in 1958 and signed a lease with United Hotels Corp. to run the Stardust. This was the same United Ho-1 tels that then owned the Desert Inn. When the Desert Inn crowd replaced United Hotels with United Resort Hotels in 1959, that company became the op erator of the Stardust's facili Later we shall see how it sold place in the htod g:im he said with a quiet pride. In i.:, tn. ', legality of the neon ligh UIC imuiii.aiiuii luai ills lui- ... . . . , . .. . . u . , ,t bling joints in the Las egas. tunes were tied tightly to the-,. ,, .',, j movs planned and executed by, ; ; k the Desert Inn organization Nor h uderworld had invend , did he seem to want it any other pro(ect .,s inveslmpnts in (h, wa" illegal places. They could soon THIS BRINGS US to some ob- learn the tricks the legitimate that show some strange inter-! build a golf course and play- "1 tfle c.?.urse a"d wo""',ng ests on the part of persons who! ground to cost no more than!au"ul Kun wdtle.r Ior " , could never get a license to run $950,000 on about 151 acres of' . J? course tases up to 1,- o .mKi;n, in V.v.Ha I ,., v,f . f . ju.uw gaiiuiia in viaier a uay. An incident that produced': planned development at the for-iAnd e at" table ,s Ia"'ngjServations that need to be made, world had devised to protect it.. .,,., i,rnRn,i;n A.irre th.L T?,n.v, n i, : beneath Las Vegas. about the boss gamblers who, investments through courts, con nitrhf Franfc Costello. the infa-i nnUV-irtc nt Vfsas i PRESI'MARI.V thp Federal have built the Strip mniic unHprwrtrld leader, es-j Tho i a u n t v inmmkcinrurc'Tt n 11 s i n 0 AHministratinn haclegas. Many caped with minor wounds after; then will enter into a lease, lni- an attempt was maae in iNeWjtially for tnree years won op- York to assassinate him. Police found a scrap of paper in his pocket with some indications that it was a listing of the business summary of casino as of April 27, 1957. and that the gross winning was $651,-! 284. j After extensive searching, authorities showed that this was exactly the winnings of the Tropicana Hotel in Las Vegas for the first 24 days that it was open. j The writing on the note was identified as that of an employe of the Tropicana who formerly had worked in Louisiana gambling joints that were controlled bjf Costello organiaai6.lri tions to extend up to 20 years, at which time the county would own the golf course and playgrounds. During the first three years the county will pay $244",800 in lease payments. During the term of the years that the county will be leasing the golf course, it will be making payments at a rate that will liquidate the costs of the golf course construction. Since the gamblers will have paid 6 percent interest on the money they borrowed, and since the county - rental-lease pay ments must cover this cost, the taxpayers' will be paying inter-' est at a rate about twice that at Las are men apart again given its approval to thei'rom tne common run. They Desert Inn's promotion activi- ,u,ve s'1 ""mun ties and plans for construction. Undoubtedly,, once again the federal government will be al lowed to pay a part of the costs of the sewer construction. Soon, as with the Paradise development, the houses will be sold and someone else will have the problem of collecting mortgage payments on them if some catastrophe befalls Nevada gam bling, or Las Vegas should suddenly go out of fashion. The golf course will be sold and the Clark County taxpayers will be liable for the payments on it. . The Desert Inn group will have its money mueh. increased by X 1 this ' maneuver. ;and ' Vill be r I'vA-. 11 T .- FRANK COSTELLO . . . figures, a profit tracts, -and franchises. This made the gamblers formidable competitors, and this great, as much as anything else ex plains why no "square Johns." as they call the people from outside the underworld, have ever been able to take over the big gambling places. Jack Donnelley, the absolutely honorable and reputable attorney who now runs the Desert Inn, would be run out of Las Vegas in a year or so by the competitors if it were not for the j II worldly wise and bitterly experi enced Moe uaiuz ana tne omers who came up to the Desert Inn from the other side of the tracks. Eitcerpted from 'Gamblers lnne " CcMiyrtKht (O IW by Wallace luinci itibliilirl by HouHilon Mifflin. : 1 .THURSDAY.' Gamblers' "- Character.

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