THE HISTORY OF THE MAFIA IN OMAHA

by Brian James Beerman

"Where in hell is Omaha?"

Mafia turncoat Joseph Valachi uttered those words before the Senate Rackets Committee in 1963 in response to a question from Nebraska Senator Carl T. Curtis about La Cosa Nostra activity in Omaha. The quote is usually used to illustrate how naive the federal government was about organized crime in those days. After all, what would the Mafia possibly want with a mid-sized corn-belt burg like Omaha? Actually, though, the quote may better illustrate how little Valachi himself knew about the workings of the Mafia beyond his own backyard.

In truth, the presence of the Mafia in Omaha has always been a well-kept secret -- long on rumor, short on evidence. The city's monopoly newspaper, the World-Herald, rarely, if ever, used the term "Mafia" when reporting on local underworld activities. Omaha, after all, is a city known for its steaks and stockyards, agriculture and insurance companies, Boys Town and Union Pacific. But it is also a place where, for much of the Twentieth Century, bookmaking was a major business and where vice interests operated, often quite openly, with little interference from the law. By mid-century, Omaha had a reputation for more illicit gambling (and more bars and taverns) per capita than any other city in the nation. In fact, the city's significance in the national organized crime picture appears to have been as a regional -- and at times national -- layoff center; a place where bookies in other cities could place bets they had taken to help balance their action and reduce the risk of a heavy loss.

The man who first organized Omaha crime was the city's shadowy political boss, Tom Dennison. Dennison was a flinty-eyed frontier gambler from the old school -- he ran dance halls in the tough mining towns of Colorado before drifting into rough-and-tumble Omaha around 1891 and setting up a policy game. He soon became known as the city's "King Gambler" and first entered the political arena around the turn of the century as a way of protecting his interests. Although he never actually held public office, Dennison advanced a "wide-open town" policy in which he acted as a power broker between the business community and the local vice lords. For more than 25 years, his power was such that no crime occurred in the city without his blessing, the police reported to him daily, and the mayor himself answered directly to him.

During the Prohibition era, Dennison developed a working relationship with Al Capone of Chicago and Tom Pendergast of Kansas City. He also formed the Omaha Liquor Syndicate, an organization designed to monopolize the illegal liquor trade in the city. This led to a rash of violence among the city's bootleggers, which culminated in the December 1931 murder of Harry Lapidus, a prominent businessman and outspoken opponent of the Dennison machine. Although the murder was never solved, few doubted who was ultimately responsible. Public opinion turned against Dennison, and on August 5, 1932, the boss and 58 of his associates were indicted for conspiracy to violate the National Prohibition Act. Dennison was acquitted on all charges, but retired in disgrace. In 1933, his ticket went down to defeat in a local election, and the following year, he died in California at the age of 76.

After the fall of the Dennison machine, a syndicate headed by Sam Ziegman and Edward J. "Eddie" Barrick seized control of local gambling. Ziegman, who was born to a poor Jewish family in Romania, operated a downtown cigar store and bookie joint called Baseball Headquarters. Barrick, who reportedly had a law degree from the University of Iowa, operated gambling joints in Des Moines before coming to Omaha in the 1920s. By the mid-1930s, Barrick had the biggest layoff book between Chicago and the West Coast and was known as the "millionaire bookie broker."

As a layoff bookie, Eddie Barrick had many contacts among the nation's top gamblers -- Dave Berman of Minneapolis and Las Vegas, Ben Whitaker in Texas, Frank Erickson of New York, and mob mastermind Meyer Lansky, who ran the Dodge Park Kennel Club in neighboring Council Bluffs, Iowa, in the 1940s. In 1950, a little black book belonging to Los Angeles rackets boss Mickey Cohen was seized and was found to contain the names and numbers of Eddie Barrick and Sam Ziegman, right alongside those of Frank Costello of New York and Charles Binaggio of Kansas City. In addition to their bookmaking activities, Barrick and Ziegman had an interest in the Chez Paree, a casino in Carter Lake, Iowa, which in the 1930s and 40s was reputed to be the largest gambling spot between Chicago and Reno.

When the IRS began collecting a 10 percent federal excise tax on wagering in 1951, Barrick and Ziegman moved their operations to Las Vegas, where they bought shares in the Flamingo hotel and casino. Ziegman was one of several former Flamingo shareholders (including Meyer Lansky) indicted in 1972 on charges of participating in a skimming conspiracy at the casino. Other than this minor setback, Barrick and Ziegman prospered in their new home. When Eddie Barrick died in 1979 at the age of 93, a Las Vegas newspaper called him "America's biggest bookmaker."

Meanwhile, the influence of Italians in Omaha's underworld was growing. For decades, Italian immigrants had crowded into neighborhoods around the stockyards and switchyards of South Omaha. There had been some early incidents of Black Hand extortionism in these communities, and during the Prohibition era, much of the city's bootleg liquor had been produced here; but by and large the Italians had always kept to themselves. That began to change in 1930, when Tom Dennison placed a Sicilian named Frank Calamia in charge of liquor syndicate operations on the South Side. Calamia's influence outlived that of his mentor. From 1946 to 1951, he controlled the C&C Publishing Co., which, as the local outlet of the national race wire service, distributed racing results received from the mob-controlled Harmony News Service in Kansas City.

Although the Omaha underworld maintained close ties to cities such as Kansas City and Chicago, it seems to have enjoyed a certain degree of autonomy. It is still unclear whether the April 1953 murder of gambler Eddie McDermott in a downtown parking garage was ordered by out-of-town interests or the local boys. In their 1952 book, U.S.A. Confidential, authors Jack Lait and Lee Mortimer listed gambler Alex Marino as the local front man for the syndicate and café owner Bennie Barone as one of the top boys in the area. Barone also had close ties to Des Moines rackets boss Louis Fratto, who was a frequent visitor to Omaha. In 1958, Omaha Teamsters Union Local No. 10 was investigated by the Senate Rackets Committee after driving a rival union out of a contract with the Midwest Burlap Bag Company of Des Moines. It was later revealed that Fratto had been active in the negotiations that resulted in the factory signing the back-door contract with Local No. 10.

It is the name of Anthony J. Biase, however, that has been most often associated with the Mafia in Omaha. Biase was identified in Ed Reid's 1969 book, The Grim Reapers, as the "leading Mafioso in Omaha," and was similarly referred to as the "head of the Mafia in Omaha" in former Kansas City Police Captain Robert Heinen's memoir, Battle Behind the Badge. Biase was born in Omaha in 1908 or 1909. His record dated back to 1922 and included convictions for assault with intent to rob and possession of burglary tools. Biase and his brother Benny owned the Turf Cigar Store (later re-named The Owl Smoke Shop) on 16th Street, which, like many Omaha cigar stores, was a front for a bookmaking operation. He had connections to organized crime figures in Kansas City, Las Vegas and California, and reportedly to New York mob boss Vito Genovese as well, although this connection is a bit murkier. Reid notes that Biase was tied to Genovese through a California narcotics trafficker named Louis Fiano. According to author Jay Robert Nash, Biase became a Genovese ally in 1957 when Genovese made a move to extend his influence to the western states. Nash goes on to say that Biase became boss of the Omaha faction of the national crime syndicate after his associate, Anthony Marcella, went to prison. Marcella, a scion of the Kansas City mob, was convicted of narcotics violations in California in 1959 and sentenced to 40 years in prison.

In March 1960, Tony Biase was indicted by a federal grand jury on eight counts of narcotics violations. At that time, officials of the Narcotics Bureau named him as the major narcotics supplier in the Midwest. Evidence against him had been gathered by an undercover narcotics agent and Kenneth Bruce Sheetz, a Kansas City hoodlum who had sold narcotics for Biase. As soon as word got around that Sheetz had turned informant, a $5,000 contract was put out on him, allegedly at Biase's request.

On June 20, 1960, Sheetz was ambushed and shot four times by two gunmen outside his Kansas City home. Although not expected to live, he managed to pull through and identify his attackers as Felix "Little Phil" Ferina and Tony "Tiger" Cardarella, both associates of Kansas City's Civella crime family.

In December 1960, Biase was convicted of violating the Federal Narcotics Act and was sentenced to 15 years in Leavenworth federal prison. He was also convicted, along with Ferina and Cardarella, of conspiring to kill Ken Sheetz. On this charge, Ferina and Cardarella were sentenced to 10 years each and Biase was assessed five years, but a federal appellate court later reversed Biase's conspiracy conviction, leaving him with only the 15-year sentence. He was paroled from Leavenworth in 1970, and although he apparently remained active in gambling, he was never in serious trouble again. His last arrest was in 1986, when he was fined for possession of gambling records. Otherwise, he lived quietly in his South Omaha neighborhood until his death on September 21, 1991.

In January 1974, the Omaha World-Herald reported that Omaha's multimillion-dollar illegal bookie business was controlled by eight men. They were identified as: Joe Digilio, Ross "Soddy" DiMauro, Anthony Manzo, Clarence Matya, Sam "Peggy" Nocita, John Salanitro, and two men whose names were not released because police had been unable to make a case against them in recent years. One of these men was described as a 66-year-old south-central Omaha resident whose record had vanished from police files in 1965. After an arrest in July 1974, this man was identified as A.J. "Tony" Higgins, a longtime Omaha gambling figure. The other man was described as a 64-year-old pool hall owner. This mystery man was undoubtedly Max Abramson.

Russian-born Max Abramson, known in gambling circles as "The Little Giant," had long been a leader in local gambling. His record of gambling-related arrests dated back to the 1930s. A veteran prosecutor once referred to him as "the elder statesman of local bookies." Abramson, who ran a pool hall called The Rocket at 16th and Farnam, was a semi-independent bookie who occasionally had dealings with operations run by Ross DiMauro and John Salanitro. In December 1970, Abramson, along with a dozen of the nation's biggest bookmakers, was indicted by the Justice Department in a 26-city gambling and racketeering conspiracy case that dragged on for several years. Eventually the indictments were thrown out because Attorney General John Mitchell had failed to sign the case's wiretap orders.

Ross DiMauro was a high-volume bookmaker who also dabbled in real estate. In 1971, he received a three-year prison term for criminal contempt of court after refusing to answer questions of a federal grand jury. The sentence was later reduced to three years probation. The questions DiMauro had refused to answer had to do with his relationship with Chicago mob figure Ralph Pierce.

With a bookmaking business approaching $500,000 a week, John Salanitro was said to be the kingpin of one of the largest illegal gambling rings in the country. The son of an immigrant shoe repairman, Salanitro was orphaned at the age of 14 and had to go to work to support his sisters. His name began appearing in print in 1959 when he was arrested with Bennie Barone in a gambling raid on a downtown apartment. By 1973, his gambling operations extended to Des Moines, Chicago, Minneapolis, Denver and Kansas City. Bookmakers from these cities relied heavily on Salanitro's operation to accept layoff bets. Transcripts from a Colorado gambling case showed that Carol Jean Reeb, the girlfriend and future wife of Denver mobster Clarence "Chauncey" Smaldone, laid off $11,800 in bets with Salanitro during one week in November 1973. In 1971, Salanitro had served part of a one-year prison term for perjury after telling a grand jury that he did not know either Paul Villano or Clyde Smaldone, members of the Denver crime family.

In March 1975, Salanitro and 17 of his associates, including Max Abramson and Ross DiMauro, were indicted by a federal grand jury for participation in an illegal gambling conspiracy. During the investigation and subsequent hearings it was shown that Salanitro's ring had conspired with public officials to obtain tip-offs on gambling raids. A municipal judge and an assistant city prosecutor were accused of helping the ring cover up their operations in exchange for alcoholic beverages, nightclub entertainment and automobiles. Although U.S. Attorney William Schaphorst was careful to say that the ring wasn't linked to the Mafia or organized crime, the connections of Salanitro, DiMauro, and Abramson to top mob figures in other cities call this into serious doubt. If nothing else, as one city prosecutor later put it, "the number of people involved in this activity (local bookmaking) constitutes organized crime." One FBI organized crime expert called the Omaha operation "one of the slickest in the country."

On April 15, 1976, John Salanitro was found guilty of involvement in a gambling conspiracy and sentenced to 15 months in prison. He appealed his case, but it would never come back to court -- on July 24, 1976, he suffered a massive heart attack and died at the age of 44. In all, 18 men either pleaded or were found guilty of involvement in the gambling ring. All received prison time, except for Max Abramson, who received a $2,500 fine and probation.

After Max Abramson passed away in August 1981, Kansas City's Civella crime family attempted to move in and fill the void left by the late gambling kingpin. Two Kansas City underworld figures, Patrick James O'Brien and John Anthony Costanza, were sent to Omaha to establish and oversee a bookmaking operation on behalf of the Civellas. They were assisted in Omaha by James "Barney" Bonofede, proprietor of Angie's Restaurant, and bar owner Donald J. Quinn, who had been convicted in 1975 of trying to arrange a $10,000 bribe of a juror in a gambling trial. The ring handled nearly $500,000 in bets during the 1981 football season, with Costanza reporting directly back to Anthony "Tony Ripe" Civella in Kansas City, but it was knocked out of operation following a series of raids in November 1981. A major investigation by the FBI and Omaha law enforcement into the Kansas City connection led to the indictment of 11 people on federal gambling charges. In November 1982, O'Brien, Bonofede, Quinn and two other men pleaded guilty to operating an illegal gambling business and received sentences of up to two years in prison. Six others who were indicted with them pleaded guilty to a lesser charge in a plea agreement with federal prosecutors. This case turned out to be one of the last federal gambling investigations in Omaha.

Illegal gambling seems to have fizzled somewhat when Omaha opened its city-sponsored keno parlors and Iowa legalized pari-mutuel wagering and riverboat casino gambling. In 1991, 100 years after Tom Dennison first arrived in the city, a company owned by I.B. "Izzy" Ziegman, a widely known local entertainment entrepreneur and the younger brother of the late Sam Ziegman, made an unsuccessful bid to be the sole operator of Omaha's new keno parlors. The company's gaming consultant was a self-described protégé of Eddie Barrick and Sam Ziegman -- former Omaha bookie and legendary Las Vegas casino pioneer Jackie Gaughan.

Today, police estimate that there are 20 to 25 large-volume bookmakers operating in Omaha, each pulling in about $30,000 a week in profits. These bookies are tied to each other and to organizations outside Omaha, especially in Kansas City, where many of them lay off their bets. Several of these individuals are the sons of old-time bookies who inherited their fathers' business, but it's unclear whether there is currently a "boss." In the past, wiretaps enabled the police to know who the local gambling kingpins were and how the hierarchy functioned. But due to a law passed by the stare legislature in 1988 that removed gambling from a list of crimes for which wiretaps could be obtained, police today aren't even certain whether a gambling hierarchy exists.

"There probably is some kingpin in Omaha," said Sgt. Steve Clouse, head of the police department's organized crime unit in a 1999 World-Herald story. "But we can't determine that without the wiretap." Without the wiretap, it's also hard for police to determine if any of Omaha's top bookies are tied to organized crime. Maybe time will tell.