Read Pt. I here.
As is now known, Benjamin “Bugsy” Siegel made a number of trips to Los Angeles in the early 1930s, often with his family in tow. This information comes not from secret gangster sources that can’t be revealed, but the plain old, dull documentary record.
In 1933, with Prohibition was coming to an end, first with the return of beer then full Repeal by the end of the year, California legalized pari-mutual betting again, and horse-racing was a big money-making industry. It was a gift to those who profited from illegal gambling also: bookmakers. According to an LAPD report complied for the State Crime Commission in 1951, the two biggest horse books in Los Angeles at the time were run by Tutor Scherer and former LAPD vice cop Guy McAfee, and that Jack Dragna muscled in on the action. The Crime Commission, organized shortly after (and largely because of) Siegel’s death in 1947, established that Siegel subsequently took over bookmaking, putting Dragna, now his subordinate, in charge the day-to-day operation.
In a 1940 affidavit asking the court for permission to leave the country on “business,” Siegel stated that he’d been a permanent resident of Los Angeles since 1935. He may have exaggerated in order to make himself appear less of a flight risk, but the claim is not inconsistent with the documentary recrod. In any case, he had definitely decided to put down roots here by October 1937.
A small item appeared in the LA Times real estate section on October 10, 1937, announcing that “Ben Siegel” was building an estate on North Delfern Drive in exclusive Holmby Hills.
Two weeks later, on October 1937, there was a second attempt on the life of gambler Les Bruneman, an associate of LA’s onetime bookmaker king Farmer Page, back in Page’s long forgotten bootlegging days. This time it was successful. Popular myth has it that Siegel, in a scene right out of a Hollywood Godfather movie, had organized all the gamblers in town and told them he was taking over. All supposedly went along with it except Bruneman. Ok.
The Bruneman murder opened an investigation of the usual local gambling “big shots,” who scattered to the winds. At the same time, cafeteria owner and 1937 county grand jurist Clifford Clinton was wrapping up his citizen-led investigation into gambling and vice. Things came to a head in January 1938 with the attempted murder of former-PI-turned-LAPD-detective-turned-PI-again Harry Raymond in a crudely rigged car bombing, later traced back to an LAPD detective Earl Kynette, a contemporary of Raymond (and Guy McAfee). In the fallout from this scandal, LA voted to recall mayor Frank Shaw, and installed judge Fletcher Bowron in his place. Bowron set to work trying to- for real- clean up the LAPD and rid the city of vice. The “big shot” gamblers like McAfee made a huge show leaving town, and their exodus attributed to Bowron’s reform efforts.
But there were repeated hints in the press that there was a “new man” in town running gambling who was squeezing them out. After all, Bowron’s influence as mayor did not extend to unincorporated county territory, like the Sunset Strip, where McAfee, Page, and the others had run illegal gambling clubs through fronts.
Meanwhile, Siegel was ensconced in his estate at 250 North Delfern, with wife Esta, their two young daughters and a live-in staff of three (butler, cook and maid), and enjoying the life of a “Hollywood sportsman.”
The Law first came calling at 250 N. Delfern on January 19, 1939, when federal agents, acting on a tip from a man who claimed to be a former employee, raided the palatial home in search of smuggled perfume. They found nothing.
Law enforcement officers were again dispatched to the address in August 1940. This time the charge was murder. Siegel’s butler John Hood met them at the door. He left them waiting on the doorstep for two or three minutes, then returned and let them in. Searching the house, they discovered several secret panels, including a bookcase that pivoted, revealing a hiding place; a secret closet that contained filing cabinets; and two sliding panels that concealed safes. In one safe, detectives found canceled checks: $1k to Farmer Page $1k, $4k to Eddie Nealis, both affiliated with The Clover Club on Sunset Boulevard.
Upstairs they found a trapdoor inside a linen closet. It led to the attic where Siegel was discovered, hiding in his pajamas. (Los Angeles Times Aug 22, 1940 and Jan 31, 1942).
Siegel was a suspect in the gangland-style execution of eastern gangster Big Greenie in Hollywood back on November 22, 1939. While in custody, he told officers most of his income came from bets on horses.
Siegel was able to beat the rap in the Big Greenie case after the corroborative witness against him, Abe Reles, went out of the window of the hotel in Coney Island New York where he was being held in protective custody.
In 1941, Nevada legalized off-track betting. Through fronts such as Moe Sedway and others, Siegel began running in Las Vegas horse betting parlors, and increasingly tried to gain control of West Coast race wire operations, state and national efforts by law enforcement to shut it down having failed.
In 1944, the Siegels decided to separate. Esta moved back to New York with the girls. Siegel put 250 N. Delfern on the market. He thereafter used his married sister and brother-in-law’s Beverly Hills address as his official residence, but lived in various rented abodes and hotels.
On May 25, 1944, Siegel, whom the friendlier papers still referred to as a “sportsman,” was arrested on bookmaking charges at the Sunset Towers apartment of friend Aaron Smehoff, better known by his alias, which can be seen in the article below.
As Siegel was being charged with felony bookmaking, actress Loretta Young, whose husband Lt. Col Thomas Lewis, was serving overseas, bought 250 N. Delfern for $85,000, giving Siegel a down payment of $8500.
Then a pest report came back with bad news: Bugsy’s house was, well, infested with bugs. Termites, specifically. It was going to cost $350 to have them exterminated. Siegel, who contended that Young had already gotten a heck of a bargain, refused to pay. He. The best he would do was offer her a $250 credit toward the purchase price. Young wouldn’t deal and demanded her $8500 back.
On August 1, 1944, Young gave birth to a son. While she was still in the hospital, Bugsy sued her. The court decided in favor of Young in January 1945. In April 1945, 250 Delfern found a new buyer.
By then, Siegel was increasingly shifting his operations to Las Vegas and the construction of the Flamingo hotel, a permanent LA resident no more. Or so he thought.
Re: Smehoff, see California Special Crime Study Commission on Organized Crime, Third Progress report, 1/31/1950.
$85,000 was about average for the neighborhood, actually. Actress Sonja Henie bought 243 Delfern (formerly home of director Norman Taurog) for a reported $90,000 in July 1943, for example. Dancers Fanchon & Marco sold a furnished 14-room Mediterranean-style home on 2.5 acres at 320 Delfern in September 1944 for $80,000.
Siegel was not too busy to appeal the 1945 decision, but in April 1946, the court again ruled in Young’s favor.
1944 for $80,000.
Siegel appealed, but in April 1946, the court again ruled in Young’s favor.