When we paused in the Stardust Saga yesterday, Tony Cornero had keeled over at the Desert Inn crap tables and John Factor, Max's brother, had become the front man for the Chicago mob at the Stardust, which finally opened in July 1958.
Jake the Barber Factor was too notorious to be granted a gambling license, even in the freewheeling days of the mid-1950s, so he had to contract with Moe Dalitz and his Desert Inn cronies to run the casino. Factor initially wanted to "rent" the Stardust to Dalitz for $6 million a year, but after Moe made him an offer he couldn't refuse, he accepted $1.2 million. Quickly, the Stardust became the second-highest earning casino in Las Vegas, with skimmed cash running all over the country supporting any number of Outfit families. So although the $100,000-a-month rent on the big hotel-casino was a bargain for Dalitz, Factor did all right for himself as well.
Still, by 1962, John Factor had outlived his usefulness and he was forced to sell the Stardust to Dalitz and his United Hotels Corp. for $14 million. Like the rent, however, the sales price was such a bargain, considering the Stardust's cash flow, that U.S. Attorney General and mob hunter Robert F. Kennedy subpoenaed John Factor to testify about the transaction. Jake the Barber claimed to be "shocked" by the implication that Moe Dalitz might be involved with Chicago-based gangsters.
While all this was going on, the IRS was investigating Factor for failure to pay taxes from 1935 to 1939. In addition, the INS was making moves to deport Factor back to his native England, where he was wanted for a stock-swindle conviction and 25-year sentence that dated back to the early 1930s. He was 70 years old and had lived in the U.S. for more than 40 years, and didn't relish getting kicked out of the country. So Factor sought a presidential pardon.
Just before the December date scheduled for Factor's arrest and deportation, President John F. Kennedy pardoned him. (The convoluted story of this pardon, engineered by none other than Robert Kennedy, is a humdinger.) Factor subsequently donated $25,000 in cash to the Kennedys; it's believed the funds were used to finance the Bay of Pigs invasion of Cuba. Oddly enough, shortly after receiving the $14 million for the sale of the Stardust, John Factor declared bankruptcy.
In 1968, Howard Hughes tried to buy the Stardust for $30.5 million. However, Hughes had purchased five other hotels in the previous couple of years and the Justice Department's antitrust division blocked the deal.
But around that time, Moe Dalitz was divesting of his more visible casino interests. He'd sold the Desert Inn to Howard Hughes a couple years earlier and was on his way toward retirement (though his fingers remained in a number of Las Vegas pies for the next 15 years or so). In 1969, he helped engineer the sale of the Stardust to the Parvin-Dohrmann Co.
Albert Parvin was a one-time interior decorator who sold the carpet for the Flamingo hotel-casino to Bugsy Siegel in return for points in the property. After Bugsy, and later Flamingo boss Gus Greenbaum, were murdered, Parvin wound up as president of the Flamingo; he also reportedly held a 30% ownership stake. It was Albert Parvin who sold the Flamingo for $10.5 million in 1960 to a group of Florida hotel owners that included Morris Lansburgh; the $200,000 "finder's fee" that Parvin paid to Meyer Lansky, one of the country's most notorious mobsters, haunted the Flamingo for more than a decade afterwards. Lansburgh, in fact, did prison time for the transaction.
In the mid-1960s, Parvin-Dorhmann, a manufacturer of hospital, restaurant and hotel equipment, bought the Fremont Hotel in downtown Las Vegas for $16 million. A couple years later, Parvin-Dorhmann bought the Aladdin Hotel for $12 million. Parvin-Dohrmann attempted to buy the Riviera around that time as well, but was denied permission by Nevada regulators. Finally, Parvin-Dohrmann bought the Stardust in 1969, though subsequent events proved that it was a purchase in name only; the Chicago-Midwest mobs still retained complete control.
But the sale of the Stardust to Parvin-Dorhmann triggered an investigation by the Securities and Exchange Commission, which accused company officials of manipulating the stock by making misleading statements about the deal; the SEC subsequently suspended trading in the company’s stock. (The suspension, in turn, prompted Parvin-Dorhmann to pay influential lobbyist Nathan Voloshen $50,000 to have his close friend John McCormack, Speaker of the U.S. House of Representatives at the time, to intervene; the ban on Parvin-Dorhmann’s stock was lifted, but it led to a brief scandal in Washington.)
Parvin-Dorhmann’s influence buying, however, also led to a more serious scandal, this one involving Gerald Ford, at the time the House minority leader, and Supreme Court Justice William O. Douglas. In 1960, Albert Parvin had set up the Albert Parvin Foundation with the profits from his sale of the Flamingo. The foundation was dedicated to "educating the developing leadership in Latin America," which authorities believed to be a front for the Fulgencio Batista government’s resistance to Fidel Castro’s revolution in Cuba, where Parvin and his associates, including Meyer Lansky, held large casino interests.
Anyway, Justice Douglas helped Parvin set up the Parvin Foundation and allegedly provided legal advice to it concerning an investigation by the IRS. In the late 1960s, President Richard Nixon faced off against the liberal justices on the Supreme Court, exposing Justice Abe Fortas as having signed a contract with the family foundation of Wall Street financier Louis Wolfson in 1966; the contract specified a $20,000 payment to Fortas for the rest of his life (as well as $20,000 for the rest of his wife’s life). When Wolfson was convicted of violating federal securities laws, he expected Fortas to help arrange a presidential pardon. But Wolfson went to prison and Fortas returned $20,000 to the foundation, then resigned as Supreme Court Justice.
Emboldened by the Fortas affair, Gerald Ford went after Douglas. When he launched his campaign to impeach the liberal justice in 1970, Douglas’s association with Las Vegas casino operators and stock manipulators came to light. It turns out that back in 1961 during the formation of the Parvin Foundation, Douglas was named a life member of the board, elected president, and voted a salary of $12,000 a year, which he collected through 1969. That year, he discontinued his affiliation in the wake of the Fortas scandal.
The impeachment hearings went nowhere, and no vote was ever taken to impeach Douglas. However, the attention on Albert Parvin and Parvin-Dohrmann was both intensive and unwelcome. Parvin was subsequently placed on the U.S. Justice Department’s list of organized-crime figures. He then reportedly sold his interest in Parvin-Dohrmann and retired. Also in light of the adverse publicity, the name Parvin-Dohrmann was changed to Recrion Corporation.
Recrion owned the Fremont, Marina, Hacienda, and Stardust hotel-casinos in 1974 when another sale of the Stardust, along with the other three properties, was engineered in name only. This time, the casinos went to Allen R. Glick of Argent Corporation, which introduced yet another sordid episode in the history of the star-crossed Stardust.
Tune in tomorrow for the thrilling conclusion of the Stardust Saga.
