Mr. Cleanface’s Dirty Laundry: Harry Reid’s Mob Money

“I’ve gotta Cleanface in my pocket,” boasted Kansas City Mafia representative Joe Agosto, unaware the FBI was monitoring his conversation (reproduced loosely in the movie Casino). FBI surveillance of Mafia gambling operations in Las Vegas in the late 1970s picked up Agosto making references to an individual he codenamed “Mr. Cleanface” and “Mr. Gillette”. Agosto’s conversations mentioned Mr. Cleanface was close to Nevada Governor-Elect Robert List. After turning state’s evidence, Agosto claimed that Mr. Cleanface was Harry Reid, then chairman of the Nevada Gaming Commission and sporting a cleanshaven, boyish look. Agosto’s claims were echoed by former Tropicana Hotel part-owner Deil Gustafson, who testified about Reid’s relationship to Tropicana attorney Jay H. Brown.

Agosto’s testimony led to the conviction of several top Midwestern Mafia bosses, but failed to touch Reid. When questioned after Agosto’s surveillance became public knowledge in mid-1979, Reid admitted to being the subject of the “Mr. Cleanface” references, but denied being paid for any favors. The Justice Department investigated whether Mafia funds had been funneled to Reid through Brown and Mafia attorney Oscar Goodman. A five-month investigation cleared Reid, and 25 years later, Reid is attacking political opponents with slogans like “If we can beat mob, we can fight DeLay-style politics”, and claiming in the process that he “kick[ed] the mob out of Las Vegas in the 1970s”.

Did Harry Reid really kick the mob out of Las Vegas in the 1970s, as he claims? Or was he in the Mafia’s pocket, as Joe Agosto claimed? What are the real facts about Reid’s relationship to organized criminal elements in the gambling industry? Is he Mr. Cleanface, or Mr. Dirty Laundry?

Reid has been using the same tactics to project an image of being Mr. Cleanface since the beginning of his political career. He started as a protege of Donal “Mike” O’Callaghan, who served as Governor of Nevada from 1970 to 1978. Reid was elected as O’Callaghan’s Lieutenant Governor in 1970. With support from O’Callaghan, he ran for Senate in 1974 against Republican Paul Laxalt. Reid’s campaign rhetoric accused Laxalt of profiting from association with billionaire Howard Hughes, who had a long relationship with Capone mob representative Johnny Rosselli and had recently secured Rosselli’s assistance in acquiring Las Vegas’ Desert Inn from associates of Cleveland mobster Moe Dalitz in 1967.

Laxalt had indeed taken contributions from Hughes. But what Reid failed to mention was, so had his own former running mate O’Callaghan. And so had Reid himself.

Hughes, like the Mafia, hedged his political bets by adopting a nonpartisan policy towards graft. He sold Laxalt, O’Callaghan, and other politicians on his move into Las Vegas by portraying it as a broomstick for sweeping the Mafia out of the casino business. Then “reformer” Hughes turned around and paid Johnny Rosselli a finder’s fee. Meanwhile handsome profits from the deal went to Moe Dalitz, then a partner in developing Rancho La Costa in the San Diego area. From bases outside Las Vegas the Mafia maintained a lower-profile presence in the city, and the Chicago Outfit and its Midwestern partners were soon creeping back into town by 1974--just in time for Mr. Cleanface to “kick the mob out of Las Vegas”, again.

O’Callaghan replaced Nevada Gaming Commission Chairman Peter Echeverria with Reid in mid-1977, in the midst of the new Chicago Mafia move into town spearheaded by Agosto. As chairman, one of Reid’s first acts was to approve the sale of the Hacienda hotel-casino (now the site of Mandalay Bay), controlled by a Chicago Mafia front company called Argent Corporation, to former lounge musician Paul Lowden. Reid approved the sale despite objections from the state’s Gaming Control Board alleging the involvement of Lowden with hidden associates from a company based in San Diego. Also in 1977 Reid and the Nevada Gaming Commission initially approved the deal that allowed Agosto’s associates to skim funds from the Tropicana for two years before Reid decided to “kick the mob out of Las Vegas”. In 1978 Reid’s commission approved applications for new Reno and Lake Tahoe ventures by the Del E. Webb Corporation, named for Del Webb, a Phoenix construction contractor whose Las Vegas buildings had been used by Bugsy Siegel and Meyer Lansky for skimming funds. After the use of Reid’s name by Agosto and his associates was reported by papers in mid-1979, Reid and the Gaming Commission approved transfer of control of the Tropicana from Agosto’s group to the Phoenix-based Ramada hotel chain, which had been founded with initial investment input from Webb.

By 1980 Reid had been cleared of Agosto’s allegations by the Carter Justice Department (then also in the process of bringing about virtually no successful prosecutions in Billygate, Koreagate, ABSCAM, BCCI, or the investigation of cocaine use by Treasury Secretary Hamilton Jordan). Since then Reid has received contributions from various donors connected with the gambling industry, including:

--Moe Dalitz, associated with the Cleveland mob, the Desert Inn, the Stardust Resort & Casino, and Rancho La Costa.

--Irwin Molasky and Merv Adelson, who partnered with Dalitz in developing Rancho La Costa but deny any criminal associations.

--Morris Shenker, an attorney associated with the St. Louis Mafia, Meyer Lansky, Jimmy Hoffa, and the Dunes Hotel.

--Paul Lowden, who after purchasing the Hacienda in 1977 from Argent Corporation purchased the Sahara Resort and Casino in 1982 from Del Webb.

--Ed and Fred Doumani, associated with the Tropicana Hotel, the El Morocco casino, Agosto, and Joey Cusumano, former lieutenant of Chicago Mafia representative Anthony Spilotro; Agosto’s infiltration of the Tropicana was facilitated in 1975 when the Chicago and Kansas City Mafia families conspired to block a Teamsters Central States Pension Fund loan to the Doumanis; when Argent Corporation’s gambling license was revoked in 1979 Argent initially agreed to sell its holdings to the Doumanis; later in 1983 the Doumanis loaned funds to the now-bankrupt Agosto.

--Bart Rizzolo, who along with his son Rick Rizzolo operates the Crazy Horse Too strip club; associated with the Doumanis and Joey Cusumano.

--Kirk Kerkorian, owner at various times of Caesar’s Palace (built with financing from the Teamsters Central States Pension Fund), the Flamingo Hotel (sold in 1970 to the Hilton Hotels Corporation, partly financed in the 1940s by Henry Crown, who also financed Chicago mob associate Jacob Arvey, and later associated with mob lawyer Sidney Korshak), and the MGM Grand Hotel and Casino (built on the heels of Kerkorian’s acquisition of controlling MGM shares from Edgar Bronfman, son of Lansky bootlegging associate Samuel Bronfman; Bronfman’s son Edgar Jr. has also been a Reid contributor).

--Steve Wynn, a casino developer who used profits from a 1970 deal involving Howard Hughes and Caesar’s Palace to purchase the Golden Nugget; described in a Scotland Yard report as a front man for New York’s Genovese Mafia family.

--Joseph Alioto, a San Francisco politician related to Milwaukee Mafia boss John Alioto; alleged by informer Jimmy “the Weasel” Fratianno to be associated with San Diego Mafia boss Frank “the Bomp” Bompensiero, a charge Alioto denied; implicated in the Koreagate Congressional bribe scandal.

--Tony Coelho, a corrupt former Congressman who in 1997 at the time of his donation to Reid was involved in a business venture with El Rancho, a Las Vegas casino formerly run by Ed Torres, an associate of Meyer Lansky.

While receiving donations from such sources, Reid has remained associated with the two attorneys involved in the Justice Department probe of Agosto’s allegations, Jay H. Brown and Oscar Goodman. Brown has been a regular contributor to Reid’s campaigns since 1982, and his law firm Singer & Brown lists Reid as a reference in one online profile. In January 2006 Reid and Goodman--now the Mayor of Las Vegas--discussed the possibility of Goodman running for Senate, with Reid describing Goodman to the press as “a very, very strong candidate”. Meanwhile Goodman had recently created a local scandal by throwing a party with a guest list which included Joey Cusumano, legally barred from Las Vegas casinos for his ties to the Chicago Mafia. Goodman’s open association with Cusumano was called by former Las Vegas FBI chief Bobby Siller “an embarrassment to the state, an embarrassment for Las Vegas and an embarrassment for gaming”. Another former Las Vegas FBI chief, Joseph Yablonsky, said of Goodman, “'Mob lawyer' is a title Goodman has relished and promoted over the years, although it's contradictory to his sporadic and inane denials that organized crime exists in the United States. The 'boys' in Chicago, Kansas City and elsewhere must be elated about their guy in Vegas. They're probably thinking 'we'll have some political juice there again.'”

Yablonsky’s last comment could also be applied to Harry Reid. So did Mr. Cleanface really kick the mob out of Las Vegas, or did he just help them move to Washington?

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I must applaud your scholarly research. I actually live in Las Vegas, and know most of these folks. Sadly,the truth is far worse than you can imagine. There is no place on earth that I can think of where the corruption is so institutionalized, except maybe in Africa.

22 posted on 01/20/2006 10:17:34 AM PST by bad company (A foolproof plan fails to take in to account the Ingenuity of fools.)

I appreciate the perspective of someone familiar with the area. Goodman seems to embody the problem.

I'm told New Orleans is a close runner-up for most corrupt, for similar reasons.

I haven't looked into his son, but from a quick search I'm seeing there was some coverage of some type of nepotism scandal involving his son and son-in-law--link to some Los Angeles Times articles from 2003 here: Harry Reid's Corrupt Connections.

What Reid did not explain was that the bill promised a cavalcade of benefits to real estate developers, corporations and local institutions that were paying hundreds of thousands of dollars in lobbying fees to his sons' and son-in-law's firms, federal lobbyist reports show....

26 posted on 01/20/2006 11:27:52 AM PST by XHogPilot (Islamophobia is NOT an illness. They really are out to kill us!)

27 posted on 01/20/2006 11:36:30 AM PST by shield (The fear of the LORD is the beginning of knowledge: but fools despise wisdom and instructions.Pr 1:7)

Although Ted Kennedy referred to Sam Alito as "Alioto" in deliberate disrespect, I thought at the time, maybe he was indeed trying to associate Alito with a known mob family instead?

29 posted on 01/20/2006 11:47:15 AM PST by FerdieMurphy (For English, Press One. (Tookie, you won the Pulitzer and Nobel prizes. Oh, too late.))

"Although Ted Kennedy referred to Sam Alito as "Alioto" in deliberate disrespect, I thought at the time, maybe he was indeed trying to associate Alito with a known mob family instead?"

When I saw the name Alioto in this piece I thought the same thing. That either Kennedy was deliberatly trying to tie Alito to Alioto or it was a Freudian slip that is very telling.

Joseph Alioto, ex mayor of San Francisco. The family ran long shoreman and other SF politics for years. My grand pa said that the corrupt Aliotos were one of the reasons why our family left SF years ago to live in the East Bay.

31 posted on 01/26/2006 9:58:54 AM PST by tertiary01 (Dems ..the party that repeats history's mistakes over and over and....)

Morris Shenker, an attorney associated with the St. Louis Mafia,"

Recall when he died that there was a large safe in his house, do not recall if the contents were ever revealed........Aside....Fitters, laborers, etc etc no names here, but lotsa explosions...vans, boats Lotsa headlines those days..

Thanks for that detail--I don't think I'd heard that part. Shenker shows up in a lot of different places.

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