History of Corruption in Las Vegas

Corruption in the very appropriately named Sin City may have first started when local Paiute Indians ripped off settlers by trading beads and buffalo robes for rifles and ammunition. Wagon trains regularly came through the area early in the 19th Century on their way west.

What more of a gamble could you take than putting everything you own into a Conestoga and dragging it a thousand miles from the east through the snowy mountains and hostile desert to find gold, silver, fertile farmland or to open a saloon?

Seriously, at the time corruption by outlaws, land speculators, crooked lawmen and bar/bordello owners was already flourishing in the little village of Las Vegas. This was long before the city became the glittering gambling capital of America.

The Spanish priests who worked among the local Paiute tribes first called the village Las Vegas … the meadows … because it was a small green area in the vast desert with nearby artesian wells fed by the Colorado River.

The town survived because it became part of the Old Spanish Trail, and later a stop on the Union Pacific Railroad. There was considerable corruption as properties passed back and forth among speculators, shooting in the streets was common and a prominent land owner was murdered. Las Vegas was a wide-open town, and the then anti-gambling law was broken by a dozen back-room operations at downtown saloons and back-street bordellos.

From the 1800s to the 1920s, the town population changed little from less than several thousand residents. Then, the growth bonanza started in the late 1920s when the Federal government decided to build a dam on the Colorado River just 30 miles from Las Vegas. Within a year or two, there were 15,000 dam workers and their families in a government-built pre-fab town named Boulder City.

Dam workers earning good steady money for those Depression years, and they headed to Las Vegas every weekend to spend it in the wide-open town. Then, while the dam was still being constructed in 1931, gambling and prostitution were legalized in Nevada. The tradition of corruption continued at full force as the city paved its main thoroughfare, Fremont Street, while on both sides local speculators built gambling halls, cheap hotels, bars, dance joints and nearby bordellos.

The most successful and heavily-publicized corruption in Las Vegas happened in the 1940s, when organized mob syndicates operating illegal gambling in New York, New Jersey, Pennsylvania and Illinois decided theyd make much more money when establishing their businesses where gambling was not only legal, but encouraged by greedy Nevada politicians. For a fairly accurate depiction of those times, see the movie trilogy, “The Godfather” and movie, “Casino”. Although the names and places are fictitious, events in the movies are based on the true story of Vegas corruption in the 1940s and 1950s.

In 1950, a Senate committee headed by Estes Kefauver spent two years in a highly-publicized investigation of corruption in Las Vegas. His conclusion was to introduce a bill in the Senate to control gambling and corruption in the state. The bill was quietly killed by Nevada Senator Pat McCarran with paid off votes and favors in Washington. That’s why the grateful city’s busy air terminal is named McCarran International Airport.

Despite their tight control over both politics and gambling in Las Vegas, the Mob’s colorful rule began to fade in the 1960s when large money-loaded banks and corporations gradually gained financial control of the city. Starting with multi-millionaire Howard Hughes, legitimate banking and investment organizations purchased existing hotels, built plush new resorts along the famed Strip, created large bedroom communities and established the University of Nevada Las Vegas.

In that decade, with construction, casino and hotel jobs boooming, the city’s population exploded from less than 100,000 to half a million. Although some of the bawdy elements held on and still exist, mostly in the old Fremont Street area, the image of Las Vegas became more refined and more upscale. The now elderly Mob bosses, except for Bugsy Siegel and a few others who were bumped off, were content to take their money and retire.

After some fits and starts in the 1970s and 1980s, Las Vegas came back with new themed resorts in the 1990s, including Mandalay Bay, the Venetian, Mirage, Treasure Island and Bellagio. Prices rose accordingly, and Sin City is no longer the place where tourists can get 99 cent buffets and 18 dollar suites. The population today is more than one million, and the city is one of the fastest growing in the U.S.

Of course, due to the recent Wall Street crash and growing business recession, Las Vegas in 2008 was feeling the results in lower visitor attendance and reduced gambling revenues. Sin City has had its ups and downs for nearly two centuries, and only time will tell when it will once again be one of the prime vacation destinations in the world.

Of course, corruption didn’t die with all the Mob bosses. It just got a bit more polite and today wears a coat of financial and political legitimacy. A town that exists only to take money away from hapless tourists with gambling machines and green felt tables can never really roam far from its rip-off roots.