Gambling operations, 1929–1945 Luciano had a vision to form a
national crime syndicate in which the Italian, Jewish, and Irish gangs could pool their resources and turn
organized crime into a lucrative business for all—an organization he founded after a
conference in Atlantic City organized by himself, Lansky,
Johnny Torrio, and
Frank Costello, in May 1929. Also, as early as 1932, Lansky shifted money from illegal activities in
New Orleans to Swiss
offshore accounts. The
Swiss secrecy law from 1934 sanctioned the money laundering by "banks whose officials knew very well they were working for criminals". and Cuba. These gambling operations were founded upon two innovations: • Lansky and his connections had the technical expertise to manage them effectively based upon Lansky's knowledge of the mathematical odds of most popular wagering games. • Mob connections and bribed law enforcement were used to ensure their establishments' legal and physical security from other crime figures and law enforcement. There was also an absolute rule of integrity concerning the games and wagers made within their establishments. Lansky's "carpet joints" in Florida and elsewhere were never "
clip joints", where gamblers were unsure whether the games were rigged. Lansky ensured that the staff administering the games were of high integrity.
Opposing Nazi activity in America 1938–1941 With the election of Hitler as the Chancellor of Germany in 1933, the influence and membership of the Nazi party grew. Soon after, the influence of the Nazi party spread to America, mostly among German immigrants, who formed the organization Friends of New Germany (FONG). In 1936, FONG was succeeded by the German American Bund, with increased Nazi activity including rallies, marches and demonstrations. At the request of the New York Judge and former Congressman
Nathan Perlman, Lansky and his gang stepped outside their usual criminal activities to break up rallies held by the pro-
Nazi German-American Bund. He recalled a particular rally in
Yorkville, a German neighborhood in
Manhattan, that he and 14 associates disrupted, on April 20, 1938: When Judge
Perlman offered to pay Lansky for his services, he declined: "I am a Jew, and I feel for the Jews in Europe who are suffering. They are my brothers".
World War II involvement, 1941–1945 During
World War II, Lansky was instrumental in helping the
Office of Naval Intelligence (ONI)'s
Operation Underworld, in which the government recruited criminals to watch out for German infiltrators and submarine-borne saboteurs. Lansky helped arrange a deal with the government via a high-ranking
United States Navy official that secured Luciano's release from prison; in exchange, the Mafia provided security for the warships being built along the docks in
New York Harbor. German submarines were sinking
Allied ships in great numbers along the eastern seaboard and the Caribbean coast, and there was great fear of attack or sabotage by Nazi sympathizers. Lansky connected the ONI with Luciano, who reportedly instructed
Joseph Lanza to prevent sabotage on the New York waterfront. Lansky was given an ONI contact code number and introduced ONI to
John M. Dunn and Jeremiah Sullivan of the
International Longshoremen's Association. After Lansky's death, a
Medal of Freedom, which possibly had been secretly awarded to him for his deal with the ONI, was found amongst his possessions.
Flamingo Hotel, 1946–1947 In 1946, Lansky convinced the
Italian-American Mafia to put Siegel in charge of
Las Vegas, and became a major investor in Siegel's
Flamingo Hotel. To protect himself from the type of prosecution that sent
Al Capone to prison for
tax evasion and prostitution, Lansky transferred his growing casino empire's illegal earnings to a
Swiss bank account, where anonymity was assured by the
1934 Swiss Banking Act. Lansky eventually bought an
offshore bank in Switzerland, which he used to
launder money through a network of
shell and holding companies. In 1946, Lansky attended a
secret meeting in Havana to discuss Siegel's management of the Flamingo Hotel, which was running far behind schedule and costing Siegel's Mafia investors a great deal of money. The other bosses wanted to kill Siegel, but Lansky begged them to give his friend a second chance. Despite this reprieve, Siegel continued to lose money on the Flamingo. A second meeting was then called. By the time the meeting occurred, the casino had turned a small profit. With Luciano's support, Lansky convinced the other investors to give Siegel more time. When the hotel started losing money again, the other investors decided that Siegel was finished. It is widely believed that Lansky was compelled to give the final okay on eliminating Siegel due to his long relationship with him and his stature in the organization. On June 20, 1947, Siegel was shot and killed in
Beverly Hills,
California. Twenty minutes later, Lansky's associates, including
Gus Greenbaum and
Moe Sedway, walked into the Flamingo and took control of it. According to the
FBI, Lansky retained a substantial financial interest in the Flamingo for the next 20 years. Lansky said in several interviews later in his life that if it had been up to him, "Ben Siegel would be alive today". Siegel's death marked a power transfer in Vegas from New York's
Five Families to the
Chicago Outfit. Although his role was considerably more restrained than in previous years, Lansky is believed to have both advised and aided Chicago boss
Tony Accardo in initially establishing his hold.
Cuba, 1946–1959 Lansky was part of a group of mobsters who came to Havana in the 1940s and 50s that involved themselves in the casino and hotel industry on the island of Cuba. He established himself as the most powerful mobster in the country. As early as 1937 he controlled the casino at the
Hotel Nacional. Batista and Lansky formed a renowned friendship and business relationship that lasted a decade. During a stay at the
Waldorf-Astoria Hotel in New York in the late 1940s, it was mutually agreed that, in exchange for
kickbacks, Batista would offer Lansky and the Mafia control of the country's casinos and racetracks. Batista would open
Havana to large-scale gambling, and his government would match, dollar for dollar, any hotel investment over , which would include a casino license. Lansky would put himself at the center of Cuba's gambling operations. He immediately called on his associates to hold a summit in Havana. In 1946 Luciano's sentence was commuted as a thanks for his help during Operation Underworld. He was freed from US prison and deported, subsequently making his way to Cuba which he hoped would serve as a base of operations. In December 1946 Meyer Lansky co-hosted the
Havana Conference with Luciano at the Hotel Nacional. It was attended by mafia families up and down the United States and set the
National Crime Syndicates policy, rules, and business interests in the new postwar era. Lansky attempted to use his influence to keep Luciano in Cuba. He interceded personally with Batista and with his friend the Minister of the Interior, Alfred Pequeno. Eventually Luciano was deported under immense pressure from the US government who threatened an exports embargo on drugs going into Cuba should Luciano not be kicked out. In 1952 Batista
staged a coup that brought him back to power. He sought to clean-up and revitalize the gambling industry, so he brought in Lansky as an advisor on the gambling reform program. In 1955 Batista altered the gambling laws so that any club or hotel worth an amount equal to or in excess of $1 million was permitted to host a casino. Following this there was a surge of investment in the hotel and club industry of Havana. It opened on 10 December 1957, for tax purposes Lansky listed his position as "kitchen manager". He ran the Montmartre Club, at which he set up a gambling school to teach young Cubans how to run games of
blackjack,
roulette and other games.
Cuban Revolution and flight to Bahamas (1959 and the 1960s) The 1959
Cuban Revolution and the rise of
Fidel Castro changed the climate for mob investment in Cuba. On New Year's Eve 1958, while Batista was preparing to flee to the
Dominican Republic before settling permanently in
Francoist Spain, where he died in exile in 1973, Lansky was celebrating the US$3 million he made in the first year of operations at his 440-room, US$8 million palace, the Habana Riviera. Many of the casinos, including several of Lansky's, were looted and destroyed that night. Lansky fled on January 7 to the Bahamas. In Nassau the
Bay Street Boys were ruling. A number of mafiosi were arrested and imprisoned by the new Cuban government but Lansky avoided arrest as he had already fled the country by then, leaving behind $17 million in cash, although his brother
Jake Lansky was imprisoned in Triscornia. Lansky's businesses were nationalized and shut down. He would later say "I crapped out" in Cuba and his brother Jake joked to Lansky's children "Don't expect a lot of money. If your father died today, he's broke". In 1975 American mercenary
Frank Sturgis testified under oath that he was approached by an associate of Lansky with an offer of $1 million to assassinate Castro. Sturgis said that he was willing to accept the offer but that he did not receive "the go-ahead from his contacts in the American embassy". In August 1960 Lansky struck a deal in Miami with the former Prime Minister of Cuba
Tony Varona. Varona would form a
government-in-exile bankrolled by Lansky who would also help with the publicity side of things. Lansky promised millions of dollars in support in return for a re-opening of the hotels and casinos in a post-Castro Cuba. However the deal fell through. After the mafia lost significant sources of revenue following Castro's revolution, they migrated elsewhere in the Caribbean to
the Bahamas, as did Lansky. He was suspected of secretly owning the Lucayan Beach Casino at
Freeport,
Grand Bahama. In any case, he derived some form of income from the venture.
Attempted emigration and trial (1970–72) In 1970, Lansky fled to
Herzliya Pituah,
Israel, to escape federal tax evasion charges in the United States. He was a strong sympathizer with Israel. In the 1940s he held a fundraiser for the
Hagannah at his establishment,
The Colonial Inn, for which he made a donation. Overall $10,000 was raised. He also sent a $25,000 cheque to the
Zionist American League for a Free Palestine. Israel fundraiser
Shepard Broad recalled that "You did not have to ask Meyer Lansky twice" for money and that Lansky "was always waiting for me in the lobby, ready with a check". Lansky utilized the New York waterfront to smuggle arms to Zionist paramilitaries by diverting shipments of arms from their intended destination to
Haifa. After the
Six-Day War broke out in 1967, he made donations to the Emergency Fund for Israel, encouraging his friends to do so also. At the time Israeli law did not permit the extradition of Israeli citizens, and under the
Law of Return, any Jew could legally settle in Israel and
naturalize. The Israeli government reserved the right to exclude Jews with a criminal past from settling in the country. Two years after his arrival, Lansky was deported back to the U.S. The federal government brought Lansky to trial with the testimony of loan shark
Vincent "Fat Vinnie" Teresa. Lansky was acquitted in 1973. ==Personal life and death==