The Strawman Case

The Strawman case was a late-1970s–1980s FBI and Justice Department investigation, run out of Kansas City, that exposed the organized-crime “skim” of untaxed cash from Las Vegas casinos and traced it back to the Midwest Mafia. Court-authorized bugs on the Kansas City crime family — combined with the seized handwritten ledgers of underboss Carl “Tuffy” DeLuna — documented how cash flowed monthly from the counting rooms of the Tropicana, Stardust, and other casinos to mob bosses in Kansas City, Chicago, Cleveland, and Milwaukee. The resulting prosecutions, tried in Kansas City as Strawman I (1983) and Strawman II (1985–86), convicted the leadership of four Midwest crime families, effectively ended the mob’s grip on Las Vegas, and supplied much of the real-world story behind Martin Scorsese’s 1995 film Casino.¹²³

Background — the Las Vegas skim

By the 1970s, the so-called “skim” was the financial engine of the Mafia’s interest in Las Vegas: tens of thousands of dollars in untaxed gambling revenue were quietly removed from casino counting rooms each month and carried back to organized-crime figures in the Midwest before the money could be declared as taxable income.⁴ The mob’s leverage over the casinos ran in part through the Teamsters’ Central States, Southeast and Southwest Areas Pension Fund, whose loans financed Las Vegas properties; one such loan of roughly $63 million to financier Allen Glick’s casino company helped place Argent-operated casinos under hidden mob influence.¹

Two clusters of casinos sat at the center of the case. The Tropicana skim was steered for the Kansas City family, with Joseph Agosto — head of the Tropicana’s Folies Bergère show — and casino executive Carl Thomas managing the mechanics of moving cash to Kansas City boss Nick Civella and his counterparts in other cities.² The Argent casinos — including the Stardust and Fremont — were controlled out of Chicago.¹

The investigation (wiretaps, the DeLuna ledgers)

The Kansas City FBI, suspecting mob involvement at the Tropicana, opened a broad investigation it code-named Operation Strawman, built around court-authorized eavesdropping on Kansas City mobsters and their associates beginning in the late 1970s.² In June 1978, agents planted a listening device at the Villa Capri pizzeria in Kansas City; later meetings — including a November 1978 gathering at a Kansas City house — caught participants discussing the skim in plain terms, including Carl Thomas explaining how cash was pulled before it could be counted as revenue.³

The investigation’s most damaging single piece of evidence came from a February 14, 1979 search of the home of Kansas City underboss Carl “Tuffy” DeLuna, where agents found extensive cryptic handwritten records DeLuna had kept of meetings, travel, and money.⁵ These ledgers documented the cash skimmed from the Tropicana and Stardust and, by one account, recorded roughly $2.3 million taken from two casinos’ counting rooms between 1976 and 1979.⁵ Combined with the wiretaps, the notes connected mobsters across several cities to the skim and became central evidence in both trials.⁵ The federal probe was led by Organized Crime Strike Force prosecutor David Helfrey.¹

Strawman I and II — indictments + convictions

The prosecutions split into two related trials, both held in Kansas City.

Strawman I concerned the Tropicana skim run for Kansas City. In 1981 a federal grand jury in Kansas City indicted Joseph Agosto, Nick Civella, Civella’s brother Carl “Corky” Civella, Carl DeLuna, and Carl Thomas; the defendants were convicted in 1983.² Nick Civella, already in failing health, died of cancer in 1983 before he could serve further time.³

Strawman II targeted the larger Argent/Stardust skim controlled out of Chicago. On September 30, 1983, fifteen men were charged with conspiring to skim more than $2 million from Las Vegas casinos including the Stardust and Fremont.¹⁶ The five-year FBI and Strike Force investigation produced indictments of major figures across Chicago, Milwaukee, Cleveland, Kansas City, and Las Vegas.⁶ On January 22, 1986, the Kansas City trial convicted Chicago Outfit boss Joseph “Joey” Aiuppa, Joseph “Joey the Clown” Lombardo, John “Jackie” Cerone, Angelo “The Hook” LaPietra, Carl “Corky” Civella, and Carl “Tuffy” DeLuna of conspiring to embezzle untaxed casino profits.⁶ DeLuna was sentenced in March 1986 to 16 years for the conspiracy, which prosecutors tied to skimming from the Stardust, Fremont, Hacienda, and Marina casinos between January 1974 and September 1983.²

Aftermath + legacy (the four-family collapse, the “Casino” connection)

The Strawman prosecutions reached the leadership of all four Midwest crime families implicated in the skim, and they are widely credited with breaking the Mafia’s control over Las Vegas casinos — a turning point that helped clear the way for the corporate era of Las Vegas gaming.¹⁷ The families involved never fully recovered their reach over the city’s gambling economy.⁷

The case also became the factual spine of popular culture’s most famous account of the skim. Nicholas Pileggi’s reporting and Martin Scorsese’s 1995 film Casino dramatized these events, though the film altered details of how the skim was discovered.¹³ Notably, Frank “Lefty” Rosenthal — the model for the film’s lead casino operator — was never indicted in the case; a later Las Vegas Review-Journal investigation reported he had been an FBI informant.¹

Significance to Kansas City

For Kansas City, the Strawman case is the moment the local crime family’s hidden national reach was laid bare in a federal courtroom in its own city. The skim ran through the Civella organization, the decisive ledgers belonged to a Kansas City underboss, and both landmark trials were prosecuted in Kansas City — making the city, not Las Vegas, the legal epicenter of the case that ended the mob’s casino era.²³ Coming on the heels of the violent river-quay-mob-war of the 1970s, the convictions marked the effective dismantling of the kansas-city-crime-family’s top leadership.²

Sources

Footnotes

1. The Mob Museum — “Battle for Las Vegas” (digital archive). https://themobmuseum.org/digital-archive/battle-for-las-vegas/ ↩ ↩² ↩³ ↩⁴ ↩⁵ ↩⁶ ↩⁷ ↩⁸

2. Wikipedia — “Kansas City crime family.” https://en.wikipedia.org/wiki/Kansas_City_crime_family ↩ ↩² ↩³ ↩⁴ ↩⁵ ↩⁶ ↩⁷

3. The Mob Museum — “The Kansas City connection.” https://themobmuseum.org/blog/kansas-city-connection/ ↩ ↩² ↩³ ↩⁴ ↩⁵

4. The Mob Museum — “The Kansas City connection” (description of the monthly skim of untaxed gambling revenue). https://themobmuseum.org/blog/kansas-city-connection/ ↩

5. Wikipedia — “Carl DeLuna” (Feb. 14, 1979 home search; handwritten ledgers; ~$2.3 million skimmed 1976–1979). https://en.wikipedia.org/wiki/Carl_DeLuna ↩ ↩² ↩³

6. Wikipedia — “John Phillip Cerone” (Sept. 30, 1983 charges; Jan. 22, 1986 convictions of Aiuppa, Lombardo, Cerone, LaPietra, Civella, DeLuna). https://en.wikipedia.org/wiki/John_Phillip_Cerone ↩ ↩² ↩³

7. Gorilla Convict / Gangland Wire — “Gangland Wire documents the investigation and fall of the four Midwest mob families.” https://gorillaconvict.com/2016/02/gangland-wire-gangland-wire-documents-the-investigation-and-fall-of-the-four-midwest-mob-families-those-families-have-never-fully-recovered-from-that-fall-they-lost-control-of-the-billion-do/ ↩ ↩²