Tuesday, January 31, 2012

Skimming the Las Vegas Casinos - Part III

By Dennis Griffin

This is the third of a three-part series explaining how organized crime families skimmed money from several Las Vegas casinos in the 1970s and '80s, and how the law eventually brought them down. 

The Investigations in Las Vegas

While FBI agents and prosecutors from several offices participated in the investigations that brought down the mobsters and ended organized-crime’s hidden control over the Las Vegas casinos, personnel assigned to Sin City itself played a major role, albeit with one rather embarrassing moment.
The agents were confident that casino money was leaving Vegas illegally and ending up in Chicago, but they needed to prove it. The feds placed the Stardust and certain employees under physical surveillance. After months of investigation, they identified a pattern for one method of the skim involving Allen Glick’s Stardust and Fremont casinos. Their big break came in May 1981.
“One of the people we were watching was a guy named Bobby Stella,” former agent Emmett Michaels remembers. “One Tuesday afternoon my partner and I saw Stella leave the casino carrying a brown paper bag. We followed him to the parking lot of a hardware store on Maryland Parkway. This particular business had several locations in Las Vegas. A man identified as Phil Ponto, who was also employed by the Stardust, met Stella there. We found out later that Ponto was a ‘made man,’ affiliated with the Chicago Outfit. The two talked for a few minutes, then Stella passed the bag to Ponto and drove away. We stayed with Ponto and the bag.”
Ponto left the hardware store and drove to his home, located off Paradise Road near the Las Vegas Hilton. He went into his house, but emerged a few minutes later to retrieve the bag from his car. The surveillance continued, but there was no activity of importance the rest of the week. Things changed on Sunday, though.
“Ponto left his house around 7:30 that morning and placed the brown bag in the trunk of his car. For some reason he then moved the car across the street, and then went back inside,” Michaels continued. “He came back out a few minutes later and drove to church. After mass he drove around town for two hours with no apparent destination or purpose. He drove in and out of shopping malls and parking lots, but made no stops. Eventually, he pulled into another one of the hardware store locations; this one was on Tropicana. There he made contact with another man we weren’t familiar with. The new guy was wearing a suit and driving a rental car. They talked for a few minutes, and then Ponto handed the bag over to the new guy. We dropped Ponto and followed the stranger as he headed toward California on Interstate 15.”
With the agents watching, the guy in the rental car pulled into the second rest area outside of Las Vegas. There, he emptied bundles of money from the paper bag and placed them in special pockets sewn into the inside of his suit coat. When all the money had been transferred, the courier continued on to the Los Angeles airport where he caught a flight to Chicago. Agents from southern Nevada contacted the Chicago FBI office, asking agents there to pick up the surveillance of the subject when his flight arrived. After reaching Chicago, the man paid a visit to Outfit boss Joe Aiuppa, presumably to deliver the money. The courier was subsequently identified as Joseph Talerico, a Teamster official.
The agents had validated their theory of the skim, but they were a long way from having proof that would stand up in a court of law. Additional investigation indicated that money was also being skimmed from the Glick-controlled Fremont. The G-men believed the cash was taken from there on a monthly basis and delivered to Chicago. They developed a plan that called for the lawmen to get marked money into the skim pipeline. That meant agents would have to visit the Fremont the evening before a suspected shipment and do some gambling at the tables. Emmett Michaels, Charlie Parsons, and Michael Glass were tasked with getting the marked money into the system. In order to get a sufficient number of $100 bills into the drop boxes, they had to lose.
“I always had trouble losing when I was playing with government money,” Emmett Michaels recalled with a grin. “I played blackjack and often had some incredible runs of good luck. Sometimes I’d be so desperate to lose so that I’d have to buy more chips, that I’d play very recklessly. I’d throw even the most basic strategy out the window and call for a hit on a hand of nineteen. The dealer and the other players would look at me like I was crazy. But when I was on one of those streaks, I’d draw a damn deuce.”
Sometimes that kind of luck drew attention that wasn’t necessarily wanted. “There were times when I’d have stacks of chips piled up in front of me and the pit boss would come over and invite me to get some of the perks reserved for high rollers. It was usually a different story when I was spending a night out somewhere else and playing with my own money.”
In spite of his undesired prowess at the table, Michaels and his colleagues were able to drop enough money to accomplish what they wanted to do. Now that they knew their plan would work, the next step was to choose a time when the courier would be picked up and nabbed with the proof of the skim in his possession.

The Cookie Caper

In order to conduct electronic surveillance and searches and to make arrests, a judge had to approve and sign warrants. Some of the lawmen involved suspected that a certain judge might not be keeping the FBI’s operations a secret. They found it hard to believe, for example, that after bugging a table in a Stardust restaurant where the casino manager and assistant manager ate their meals every day, the only thing the men seemed to talk about was golf and women. But the government was required to follow the law and obtain the appropriate warrants and authorizations regardless of their suspicions.
“Harry,” a bail bondsman who came to Las Vegas in 1958, thinks he knows another method by which the bad guys found out about whose phones were being tapped. “I had a lot of juice with the phone company then. I know for a fact that a phone company employee regularly provided a list of numbers that were going to be tapped. I know because I received a copy of those lists myself. There were a lot of people who were very glad to get that kind of information.”
In addition to the phone company employee, Harry alleges there was an even better source for leaks. “There was a concern at the phone company that a phone might be tapped without having full legal authorization. So the company hired a lawyer to review all the paperwork for each tap. It turns out that the lawyer they retained worked out of Oscar Goodman’s office. Did you ever hear of anything so outrageous?”
Whether leaks resulted as Harry contends, were the work of an unscrupulous judge, or a combination of both, the bottom line is that the targets frequently knew ahead of time what the lawmen were planning.  

* * *

Stan Hunterton, the former Strike Force attorney, was involved in preparing and submitting warrant applications to the court and helping plan some of the law enforcement activities, including when arrest warrants would be served.
“Joseph Talerico was always the courier for the skim money from the Argent casinos,” Hunterton recalled. “The routine was for him to come to Vegas and get the money. His contact here was Phil Ponto. This Ponto was what we called a sleeper. That’s someone with no criminal record, but Ponto was actually a ‘made man’ out of Chicago. One of the agents thought he recognized Ponto’s name from a book written by mobster-turned-informant Jimmy Fratiano. It turned out the agent was right, only in the book the name had been misspelled as Ponti.
“On January 3, 1982, not long after the indictments in the Tropicana case, the FBI was ready to arrest Talerico and Ponto when they exchanged the skim money. The day started off with a variation on the part of Ponto; he was carrying a box instead of a paper bag. I guess everybody assumed they’d decided to put the money in a box that day and didn’t think too much of it. But when the arrests were made, there was no money. The box contained cookies and wine.
“It was obvious that the bad guys had become aware of what was coming down. They had set us up, no doubt about it. I can smile about it all these years later, but I can assure you there was nothing funny about it at the time. An awful lot of time and effort had been spent getting to that point, and then it all went down the toilet. Needless to say, we were the butt of a lot of jokes in what became known as the cookie caper.”
Hunterton hauled Talerico and Ponto before a grand jury in 1983. Their first effort to avoid talking was to exercise their Fifth Amendment rights against self-incrimination. Hunterton countered that by granting both men immunity. Even with no legal reason to remain silent, the pair still refused to testify. They were each sent to jail for contempt, but their lips remained sealed. They never did answer the government’s questions.

* * *

Strawman case agent Lynn Ferrin remembers the skimming investigations very well. “They were exciting times,” he said.
“When we were watching Ponto and Talerico, we made high-quality films of their meetings. On one occasion we brought in three lip readers to try to figure out what their conversations had been. One of the experts came very close to what we believed had been said; we would have loved to be able to use his interpretation in an affidavit. But the other two had differing opinions. With that lack of agreement, we ended up disregarding all of their versions. I even rented an apartment next to Ponto’s residence for a while during the surveillance. I spoke with him occasionally. He was very quiet … a real sleeper.”
Regarding the cookie caper, “It was a real bad day for us and me personally. If I’d been living in feudal Japan I’d have been required to fall on my sword. We’d been doing these Sunday surveillances on those guys for several months and everything had always gone like clockwork. But on that day the crooks were so confident and comfortable; we’d never seen anything like that before. We didn’t know for sure who, how, or why, but someone had obviously ratted us out to the mob. We were highly confident that the leak wasn’t from any of our people. Many of us believed that the federal judge who signed the order authorizing the electronic surveillance at the Stardust was the culprit. That was only speculation, but after that it seemed like the bad guys were aware of what we were doing. We had to call Washington and tell them what happened and that we couldn’t say for certain why it had gone wrong.
“Prior to that day I had been in favor of simply stopping Ponto one of those mornings and grabbing the bag from him. He certainly couldn’t have complained to the police and it would have given us the probable cause we were looking for. But headquarters and DOJ [Department of Justice] were afraid something would go wrong and never approved the snatch. If they had, it would have caused a lot of ripples in the various crime families. They may have even taken action against some of their own if they suspected them of being involved in stealing the skim.”
Another incident that Ferrin described as “sensitive” involved aerial surveillance. “Our plane developed some problems and was forced to land on the golf course at the Las Vegas Country Club. It turned out to not be a very discreet surveillance.” This scene was depicted in the movie Casino.
But other covert operations went very well. “Our guys did a tremendous job. Agents posing as maintenance men bugged a table in a restaurant at the Stardust in front of a room full of guests and casino employees. It was a good placement.”
After the cookie caper, the FBI changed tactics from covert to overt and went after the Stardust’s new owners, the Trans Sterling Corporation, openly. “We had enough information to start going over their records,” Ferrin said. “The Carl Thomas method of the skim primarily involved stealing from the count room. We found that another method of theft was also going on at the Stardust. This one involved the cashier’s cage.
“We looked at thousands of fill slips from the Stardust for the years that we knew the skim was going on. The fill slips were used when chips were removed from the cage to replenish the supplies at the gaming tables when they ran low on chips. The slips were required to have the signatures of four different casino employees. The money involved was about $20,000 per slip, and was presumed to reflect [casino] losses at the tables. We eventually discovered a pattern of forged signatures on the fill slips. That discovery led to the next step. We took handwriting samples from over two hundred Stardust employees and sent them to the FBI lab in Washington. Analysis revealed that the casino manager, Lou Salerno, was responsible for most of the forgeries.
“We got some good convictions in this phase. More important, though, through our investigation we were able to help the Nevada Gaming Control Board seize the Stardust. They revoked the licenses of the Trans Sterling people and fined them $1 million. The Stardust was eventually purchased by the Boyd Group, ending over a decade of mob control.”
That wasn’t the entire story for Lynn Ferrin, though. “The cage manager was a guy named Larry Carpenter. During the course of the investigation, he came to hate my guts. We lived in the same neighborhood and some mornings I’d come out to go to work and find that somebody had spit all over my car. I’d have to clean the car off before heading for the office. I suspected that Carpenter was responsible.
“Carpenter was gay and had full-blown AIDS. I thought maybe he was trying to infect me by having me come in contact with his body fluid and absorb it through my skin. Anyway, I stayed up all night to see if I could find out who was sliming my car. Around 5 a.m. I caught Carpenter coming around the corner on his bike. I could tell by the look on his face that he was the one. It never happened again after that morning. Carpenter later committed suicide, hanging himself when he went to jail.”
But there was more. “Lou DiMartini was a floorman at the Stardust. He claimed that during the investigation I caused him to suffer irreparable harm by asking his employer questions about him. He filed a $1 million civil suit against the government and me individually. It took seven years and the case went all the way to the U.S. Supreme Court where it was decided in the government’s and my favor.”  
How does Ferrin sum up the results of the Strawman investigations?
“I think that our investigation basically broke the back of the mob’s efforts to control the casinos in Las Vegas.”

That last statement seems to say it all.        

Dennis Griffin is a True Crime Author, Co-Host of Crime Wire and Real Wiseguys on VegasKool.com.  He has written several books concentrating on the history of the mob presence in Las Vegas. www.dennisngriffin.com


  1. Such a very nice article about crime. It's very nice story about Las Vegas casinos in the 1970s and '80s crime. so it's necessary make rule & regulation and also need help FBI any time.

  2. Would the "Harry" you mention here be Harry McBride by chance? Just curious.


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