Top 10 Las Vegas Scandals

Posted on: April 27, 2023, 11:30h. 

Last updated on: July 19, 2023, 02:19h.

Corey Levitan Read More

Expertise: Commercial Gaming, Entertainment, Expert Insight, Las Vegas, Restaurants, Las Vegas Myths.

Every city has its share of scandals. Las Vegas has two or three cities’ shares. From local politicians to gaming luminaries to murderers, people operate under the impression that what happens in Vegas not only stays there, but gets a pass from law enforcement.

In the days of mob rule, they were 100% correct. No other American city relied so heavily, for so long, on money from illegal sources for its prosperity and security. Mafia money corrupted police officers, judges, and even legislators.

Even after the casino industry finally exorcised its criminal ownership in the ’80s, various bad actors continued assuming that anything can be gotten away with in Vegas with enough power.

10. Operation G-Sting

Between 2006 and 2009, 17 defendants pleaded guilty to various offenses related to bribing public officials. They included four Clark County Commissioners convicted of accepting bribes from Michael Galardi, the owner of three southern Nevada strip clubs. Galardi and fellow strip club owner Rick Rizzolo were trying to remove local “no touch” laws.

The investigation, nicknamed “G-Sting” as a regrettable pun on the G-strings donned by exotic dancers, included interviews with actors George Clooney, Robert De Niro, and Joe Pesci, who all had interacted with Rizzolo at his mobbed-up Crazy Horse Too club.

US District Judge Larry Hacks called Operation G-Sting “some of the rankest corruption of local government that has ever occurred in Nevada.”

9. Tupac Shakur’s Murder Investigation

On the night of Sept. 7, 1996, rap music’s brightest star was extinguished while riding in a car on Flamingo Road near Koval Lane.

Death Row Records owner Suge Knight was driving Tupac Shakur from a Mike Tyson fight at the MGM Grand Garden arena to a nightclub when a white Cadillac pulled up to the right side of his black BMW 750i. A window lowered, and a dozen shots were fired, four of them striking Shakur, who died six days later at a local hospital. He was 25.

What raises this tragedy from mystery to scandal, in the minds of many, is how it could happen in such a crowded location without a single suspect being charged.

Orlando Anderson, a member of the Southside Crips, is believed by LA police to have been at least one of the triggermen. Surveillance footage from the MGM Grand shows Shakur’s entourage viciously beating Anderson minutes before the murder. The beef was allegedly over a stolen medallion.

We’ll never know for sure because Anderson died in a Compton, Calif., shootout in 1998, having denied any involvement in the crime.

8. Harry’s Crown Jewels Exposed

In a just world, this would not make any list of scandals anywhere. In August 2012, a young and unattached Prince Harry got drunk and had a good time in Vegas one weekend. Maybe there was some casual sex involved, maybe not.

This was a typical Vegas weekend for any other beyond-wealthy young single male. But photos of Harry’s partying leaked, sending the entire nation of England into a mega-tizzy. Seriously, Britons wouldn’t stop thinking and talking about this weekend and the part Las Vegas played in it for years. They still think and talk about it.

Harry, who was 27 and about to ship off to Afghanistan, for crying out loud, hung out with some friends at the MGM Grand’s Wet Republic Pool party by day, where the girls in the cabana next door reported that he asked, “Which one of you is single?” while “sticking out his tongue and acting really loud and goofy.”

That night, in his fully comped, $7K-a-night suite at the Wynn, Harry, his friends, and some women they just met in a casino bar played strip billiards. They were naked and photographed — what?!! — hugging.

When he got home, Harry was forced to issue an apology for dragging the royal household into global disrepute.

By the way, if you didn’t already know, he’s a natural ginger.

7. Stardust Skim

From 1974-76, between $7-$16 million was siphoned by the mob from the Stardust, a Strip casino the FBI believed was operated by “entertainment director” Frank “Lefty” Rosenthal without a gaming license.

Rolls of quarter and dollar tokens were delivered to the Stardust from the Fremont, Marina, and Hacienda hotels owned by Stardust parent company Argent, which were never officially counted.

This was only the largest Vegas skim operation ever uncovered. Many potentially larger scams dating back to the ’40s are believed to have occurred without being discovered.

Mob skimming continued even after the Stardust was sold in 1979. The new owners, Al Sachs and Herb Tobman, denied involvement but agreed to give up their gaming licenses and pay a $3M fine, the largest imposed by the Nevada Gaming Commission at the time.

The convictions in this scandal marked the end of the mob’s control of casinos in Vegas. They’re still around but relegated to the underworld of strip clubs, illegal prostitution, and drugs.

6. Ted Binion Murder Trials

On Sept. 17, 1998, Ted Binion was found dead in his Las Vegas home. Two years later, his ex-stripper girlfriend, Sandy Murphy, and her boyfriend, Binion acquaintance Rick Tabish, were convicted of his murder. Both received life sentences.

So what elevates this from a boring “48 Hours Mystery” episode to a scandal? In 2003, Murphy and Tabish had their convictions overturned by the Nevada Supreme Court over jury-deliberation irregularities. At their 2004 retrial, they were acquitted of murder because the prosecution was unable to convince jurors of the cause of Binion’s death.

A national headline for months, this reinforced the image of Vegas as a corrupt town where anything can be gotten away with.

Murphy and Tabish were convicted on lesser charges of conspiracy to commit burglary, burglary, and grand larceny involving an attempt to steal silver from the gaming executive’s vault in Pahrump after his death.

5. Immediate Flamingo Takeover After Bugsy Murder

On the night of June 20, 1947, Benjamin “Bugsy” Siegel, the man credited with completing the Flamingo Hotel, was assassinated. A bullet entered the back of his skull and exited through his eye socket, knocking his eyeball across the room. The case remains unsolved.

The murder may have occurred in Beverly Hills, but it thrust Las Vegas into the international spotlight. Literally, 20 minutes later, Meyer Lansky, Gus Greenbaum, and other known associates of the underworld marched into the hotel and announced they were in charge, and all remaining plausible deniability went out the window.

Las Vegas was thoroughly under mob control.

4. Operation Yobo

In 1983, five popular political leaders, including state senators Floyd Lamb and Eugene Echols, Clark County Commissioners Woodrow Wilson and Jack Petitti, and Reno City Councilman Joe McClelland, were convicted of accepting bribes in a sting bearing the nickname of Las Vegas FBI chief Joseph Yablonsky.

Lamb, the sting’s initial target, was busted after demanding a 1% “finder’s fee” on a $15 million loan he offered to FBI agent Steve Rybar through the Public Employees Retirement System. He spent nine months in prison.

Lamb was from a respected and popular local family. His brother, Ralph, served for years as sheriff of Clark County and another brother, Darwin, served as a Clark County Commissioner.

Floyd Lamb Park in Las Vegas, named before his indictment, was never renamed.

Three of the five convicted served full sentences. Lamb served nine months of a three-year sentence, released in part because of poor health. McClelland’s guilty verdict was overturned because of faulty jury instructions after he had already served his one year.

This scandal reinforced the stereotype that state and local officials in Las Vegas cannot be trusted.

3. Sitting Federal Judge Convicted

Only one federal judge in history has been convicted of a crime while actually sitting on the bench. And, of course, it happened in Vegas. Harry Claiborne, once a law partner of former Las Vegas mayor Oscar Goodman, was impeached by the US House of Representatives, then convicted by the US Senate for tax evasion in 1986.

Originally, Claiborne was charged with accepting bribes exceeding $30K and failing to pay taxes on more than $100K. But a mistrial was declared and only the tax-evasion charges were levied the second time.

Claiborne, who was represented by Goodman at his trial, was imprisoned from May 1986 to October 1987. He was allowed to begin practicing law again in Nevada in 1987. He fatally shot himself in 2004, while suffering from Alzheimer’s disease and other health problems.

2. MIT Blackjack Cheating Scandal

A team of brilliant college students, mostly from MIT and Harvard, used their statistical prowess to slowly but regularly beat Las Vegas casinos at blackjack. The operation, headed by 1980 Harvard MBA graduate Bill Kaplan, who allegedly made $10M and trained dozens of the team’s members, inspired the 2008 movie “21” and dealt Las Vegas a permanent black eye.

The most interesting part of this scandal is that the perpetrators managed to evade detection for 20 years and may have continued doing so were it not for one disgruntled former team member who blew the whistle in the ’90s.

Eventually, the team’s members were all banned from playing in the casinos they had profited from, but they had already won millions without serving a day in prison. Counting cards isn’t against the law in any state despite what casinos think of the practice.

1. Steve Wynn Sex Scandal

Steve Wynn is the founder of modern Las Vegas, plain and simple. Beginning in with the Mirage and then the Bellagio, he single-handedly took the Strip, kicking and screaming, from the cheap buffets and has-been headliners of its history to the upscale luxury destination it remains today.

It is no less possible to deny this fact than to deny the disturbing but vetted allegations of sexual misconduct levied against him by dozens of women in a shocking investigation published by the Wall Street Journal on Jan. 26, 2018.

The accusations include sexual harassment, coercion, indecent exposure, and an alleged sexual assault case that Wynn paid $7.5 million to settle. In February 2019, Nevada regulators fined Wynn Resorts $20 million for failing to respond to sexual misconduct allegations. In April 2019, the Massachusetts Gaming Commission added $35 million more for covering up the allegations.

Wynn continues to deny all of the allegations and was never convicted of a crime in association with them.