The Sinatra Files (46 page)

The FBI questioned some in the Rat Pack about all this. One answer attributed to Sinatra here would later be contradicted in Nancy Sinatra’s biography of her father: “The shows were Dad’s way of paying back Giancana for the help he provided to the Kennedy family,” she wrote
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    SINATRA and MARTIN denied all knowledge of the gambling, and SINATRA claimed he arranged all the appearances merely as a favor to Mr. LEO OLSEN, the owner of the club, for past favors, and that GIANCANA had nothing to do with it. Available information indicates otherwise.

    
At around the same time, Sinatra was looking to expand the Cal-Neva casino resort on the California-Nevada border, in which he had acquired a 36.6 percent interest in 1961. The FBI suspected that Giancana had a secret interest in the establishment. He had been overheard saying that he was “gonna get my money out of there” but still “end up with half the joint,” while an associate fretted that the expansion would bring unwanted “attention.”

Sure enough, the FBI learned that Sinatra was seeking a multimillion-dollar Teamsters pension-fund loan to finance the expansion. It suspected that the mob was using cheap loans from Jimmy Hoffa’s Teamsters to expand its Nevada operations. The FBI inquiry was short-lived, as shown by these three memos:

Los Angeles, California
April 17, 1963

    On January 16, 1963, FRANK SINATRA and MILTON A. RUDIN, Attorney at Law and Financial Advisor to SINATRA, were interviewed at the offices of Essex Productions, 9229 Sunset Boulevard, Suite 512, Los Angeles, California, concerning the Cal-Neva Lodge, Crystal Bay, Nevada.

During the course of this interview Mr. RUDIN, with the consent of Mr. SINATRA, advised that their current plans for the Cal-Neva Lodge included quite a substantial expansion of the hotel which would necessitate the bringing in of some $4,000,000.00 of added capital. RUDIN stated that he found out by checking into the loan situation that banks and insurance companies, in order to make loans, would ask for stock options, which they are not ready to agree to.

Mr. RUDIN advised that he has become familiar with some of the pension fund loans from reading the series of articles run by the “Los Angeles Times” on investigations of loans by the Teamsters to various Nevada casinos and that these are straight forward loans. He advised that he had gone to Chicago and had talked to various Teamster officials in the Chicago area concerning the possibility of securing a loan for Cal-Neva. He advised that the Cal-Neva, at the next meeting of the trustees for the pension fund in March, will, according to their present plans, apply for a loan in order to achieve their expansion program.

Both RUDIN and SINATRA advised they wished to go on record that there were no under-the-table payments of any kind involved, that this was a simple straight forward business transaction with sufficient collateral involved. Mr. RUDIN advised that the person he had contacted regarding the possibility of such a loan was HAROLD GIBBONS. SINATRA mentioned that DORIS DAY had secured a similar type loan from the Teamsters for a motel that she owns, and he had asked her if she had had to cut anybody in, and she advised him that it was not necessary, that it was a straight loan.

    
Chicago, Illinois
May 31, 1963

A review of the minutes of a meeting held on September 21, 1962, by the Trustees of the Central States, Southeast and Southwest Areas, Pension Fund of the International Brotherhood of Teamsters revealed the following pertinent information:

Mr. Milton A. Rudin appeared before the Trustees on behalf of Park Lake Enterprises, Incorporated, Cal-Neva Lodge, Nevada.

The borrower was seeking an immediate loan of $3,000,000 with an additional commitment for $2,000,000. This loan was to be used for the purpose of developing the resort.

Trustee James R. Hoffa summarized the application as follows:

The request for the loan was on Park Lake Enterprises, Cal-Neva Lodge, Nevada, for a $3,000,000 present loan with an additional commitment of $2,000,000. Hoffa asked Rudin to explain the application.

Mr. Rudin advised the Trustees that Mr. Frank Sinatra was the principal stockholder of the corporation. Cal-Neva had been operated for 30 years at Lake Tahoe. Sinatra had acquired majority control over the past two years and started an expansion program without permanent financing.

Rudin detailed the application and said they were asking for $5,000,000 with the understanding that the additional $2,000,000 which would be only 60% of the applicant’s actual cash was additional investment in additional construction.

In response to a question asked by Trustee Albert Matheson, Rudin stated that Sinatra and others will have $540,000 plus some monies they have loaned in, namely, a quarter million dollars from various companies.

Rudin continued that it was their intention to put other Sinatra ventures into this which would supply income and additional capitalization rather than put in tax paid dollars. Rudin also stated that if the Fund put $5,000,000 into this project the property would then be worth from $8,000,000 to $10,000,000.

A motion was made by Trustee Frank Fitzsimmons that the loan be rejected on the basis presented and “that the man come in” and give a definite presentation for a future request on the actualities of what is going to be entailed in his request for money.

The motion which was seconded by Trustee John Spickerman was carried with dissent.

After the vote, Hoffa who was acting as chairman, advised Rudin as follows:

“The committee has rejected the presentation presented today and recommends that you present at the next meeting here, more concise program—namely, exactly how much money you are going to spend, how much money you are going to have in this from Sinatra and the other stockholders’ interest in it, and what your projection is going to be for the next five years, so we will know exactly what this Fund is investing in. Plus, we want to have an outline as to what other enterprises will Sinatra put into this operation to show that there will be ability to pay back the money he borrows from us.”

This document contains neither recommendations nor conclusions of the Federal Bureau of Investigation. It is the property of the Federal Bureau of Investigation and is loaned to your agency; it and its contents are not to be distributed outside your agency.

    This case should be placed in a closed status in view of the fact that the trustees of the Teamsters Union Pension Fund during the 9/21/62 meeting rejected the loan application in this matter.

All offices in the future should be alert to any indication this loan is being reactivated. Should this occur, the Bureau and other interested offices are to be furnished a letterhead memorandum suitable for dissemination. No open inquiries are to be made in connection with this loan in absence of specific advice from the Bureau.

    
Soon after Sinatra was interviewed about the Teamsters loan, the FBI’s special agent in charge for Los Angeles asked Hoover for authorization to look into planting a bug (a “misur installation” in bureau jargon) in Sinatra’s Palm Springs home—the same house where the singer had hosted Giancana and JFK
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DATE: April 24, 1963
TO: DIRECTOR, FBI
FROM: SAC, LOS ANGELES
ATTENTION: ASSISTANT DIRECTOR COURTNEY EVANS

RE: FRANK SINATRA
“Francis Albert Sinatra” (True Name)
ANTI-RACKETEERING

    The Los Angeles Division during recent weeks has been in receipt of information that would tend to indicate the above-captioned individual apparently intends to spend more of his time in the Palm Springs area, than in Los Angeles. He has had installed a direct telephone line between his home in Palm Springs and his personal offices at 9339 Sunset Boulevard, Los Angeles.

A review of information that has accrued during the years, especially the past few years, has shown a constant association of SINATRA with some of the more infamous individuals of modern times, i.e., during the late 40’s with LUCKY LUCIANO, and he was reputedly a money courier for the benefit of LUCIANO; during the 30’s, various pieces of information tend to indicate an alliance with the late WILLIE MORETTI of New Jersey.

Currently and for the past several years, and reported by the Chicago, Las Vegas and Los Angeles Division of the Bureau, he has tied up with SAM “MOONEY” GIANCANA, with GIANCANA apparently issuing him orders as regards to appearances at the Villa Venice, the use of SINATRA’s house at Palm Springs for assignations with PHYLLIS MC GUIRE, accompanying of SINATRA recently in Acapulco, and during the past season at Cal-Neva having JOHNNY FORMOSA present at Cal-Neva Lodge with apparently a great deal to say in its operation.

Chicago sources have advised of GIANCANA’s disappointment in SINATRA’s apparent inability to get the administration to tone down its efforts in the anti-racketeering field.

On at least two occasions during past years, SINATRA has been in Atlantic City, and taking over the floor of one of the major hotels has had a number of prominent hoodlums such as BONANNO of Phoenix, FISCHETTI of Miami, GIANCANA and others in attendance with all local hotel help barred from the floor.

SINATRA is an owner of considerable points in the Sands Hotel, Las Vegas, and at present is about a 100% owner of Cal-Neva Lodge at Lake Tahoe.

In interviews concerning this ownership, he has maintained he is the owner in fact as well as of record, that he represents no one other than himself and that GIANCANA is someone he recalls meeting at an airport and he has no connection other than as an entertainer keeping himself before the public. Confidential sources tend to furnish information to the contrary.

The long continued association of SINATRA as a possible front for investments for hoodlums of both national and international stature has led to the belief by this division that a confidential source if established in Palm Springs concerning SINATRA would undoubtedly develop information of extremely valuable intelligence nature, and furnish a picture of top level criminal investments and operations.

Authority is requested to conduct a preliminary survey to determine the feasibility of a misur installation at SINATRA’s residence in Palm Springs, California.

No action will be taken in this matter without Bureau authority. Full security is assured.

SINATRA’s home near Palm Springs has the mailing address of 70-558 Wonder Palms Road, Rancho Mirage, California.

    
But, surprisingly, Hoover rejected the request
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SUBJECT: FRANK SINATRA
“Francis Albert Sinatra” (True Name)
ANTI-RACKETEERING

    Re your airtel 4/24/63.

Bureau authority not granted at this time to conduct a survey to determine the feasibility of a misur installation in Frank Sinatra’s Palm Springs, California, residence. In the event you develop information which would warrant such an installation, you may resubmit your recommendations. You are reminded that all misurs must be completely justified.

    
The FBI, however, continued to keep a close eye on Giancana as part of RFK’s mob clampdown. In June of 1963, agents in the Chicago FBI office started harassing Giancana with what they called “lockstep surveillance.” It drove him to distraction. Desperate, Giancana sued to get the FBI to back off, but he also made an extraordinary overture involving Sinatra, as recounted in this Hoover memo to RFK
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    We have learned through our surveillance of Giancana that he has resumed holding meetings in the Armory Lounge in Forest Park, Illinois. Giancana’s lieutenants have been shuttling carloads of individuals to and from this location where Giancana “holds court” at a large table just inside the entrance.

Last week one of Giancana’s top lieutenants, Charles “Chuck” English, contacted our Agents and requested an interview. This interview took place in the Armory Lounge at a time when Giancana was also present in another part of the lounge. At one point Anthony Tisci, attorney, son-in-law of Giancana and now his
representative in the First Ward, joined in the conversation. Tisci admitted that Giancana’s reason for instituting court action was a “desperation measure” caused by his extreme agitation over FBI surveillance. Tisci stated further, “We are putting all our eggs in one basket.”

Toward the end of the interview, English, who was slightly intoxicated, attempted to persuade Giancana to talk with the Agents. Giancana declined but as the Agents were driving away, English came out with a message from Giancana that, “If Bobby Kennedy wants to talk to me, I’ll be glad to talk to him and he knows who to go through.” In this respect English had previously mentioned Frank Sinatra as a person who could arrange such a meeting.

    
Nothing ever came of the overture. On July 16, 1963, Giancana’s court action resulted in the FBI being ordered to back off. Until the FBI could get the order reversed, other law enforcers picked up his trail, “much to the consternation of Giancana, [who] shouted a steady tirade of verbal abuse” every time he noticed he was being followed, an FBI memo reported. That same month, Giancana made a fateful visit to the Cal-Neva. This excerpt from a later FBI memo described the result: Sinatra was forced to divest himself of interests in both the Cal-Neva and the Sands
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