I don’t remember the exact date but it was in the middle of July 1987. I was watching the 6:00 p.m. local news and the attractive Ms. Gwen Castaldi was interviewing everyone and anyone about the closing of the Castaways. Off to the side and playing blackjack was Steve Wynn wearing his U.S. Army cavalry hat telling Ms. Castaldi how he was going to miss the Castaways. He was going to miss it so much that he was tearing it down and was going to replace it with something better. Somehow I never could understand that logic in his explanation. I turned to Rena and asked if she would mind if I changed the channel. She didn’t. I was sick to my stomach. Another piece of "our" history was going to be destroyed in the name of progress. Little did I realize that night the Las Vegas I loved was beginning to "die".
Howard Hughes bought the Castaways sometime during 1970. There was a tremendous amount of history prior to his purchase involving the property that really contributes nothing to what I am going to tell you. If you’re interested in this history I’m sure you can find it in other articles that have been written about this unique piece of property. I am going to pick up the story around 1976 when Bill Friedman took over responsibility as President and General Manager with Sonny Reizner (now deceased) operating the "Hole in the Wall" sports book.
In my opinion, the accidental combination of Bill Friedman and Sonny Reizner working together created a chemistry that will never again be repeated in the gaming industry. The enthusiasm, creativity and marketing ability of both individuals reflected itself in one of the most successful gaming operations ever created here in Nevada or anywhere else for that matter. I doubt it could ever be duplicated again. Many have tried only to fail miserably. Who but the talented Bill Friedman could create an idea to have a midget wearing a sandwich advertising board stating "follow me to the Castaways" run through Howard Hughes upscale sister property the Sands (located across the street) with Sands security in genuine hot pursuit? The first time I saw it I laughed till I cried. It was a brilliant idea reflective of a brilliant marketing mind. Friedman packed the Castaways with his unique marketing ploys.
I believe It was Friedman who thought of the 97.4% return on certain dollar carousels. I can remember driving by the Castaways’ marquee advertising the 97.4% return laughing to myself and shaking my head – Friedman did it again! Oh the machine's) returned the 97.4% but ONLY after the progressive jackpot hit and was taken into the machine's) hold computation. Until the progressive jackpot hit the machines held a very healthy percentage in favor of the house.
Sonny Reizner's "Hole in the Wall" sports book was exactly that a hole in the wall. Tucked away behind the craps and blackjack tables with room for two ticket writers it was one of the first sports books located within a strip casino. A novel idea for strip gambling houses since sports betting was relegated to independent downtown locations with a few, like Little Caesars, scattered on the strip.
It was Sonny Reizner who brought to Las Vegas the novel idea of a football contest where the participants, for a fee, could match their skill against others to see who could pick the most winners. He started with the $1,000 entry fee for the "Challenge" and graduated over time to the $5,000 "Ultimate Challenge". Every week during football season you could come to the Castaways and see the contest results posted on the right wall, behind glass, as you entered the foyer. Often, it was difficult to maneuver your way through the people, six and seven deep trying to see who was leading the "pack" in order to get through the double glass doors that led into the casino.
It was Sonny who coined the phrases "Monday Night Madness" and "Monday Night Fever". It was Sonny who invented and peddled his Monday Night Fever parlay card with ridiculous propositions like who would win the coin toss. For a minimum $10.00 bet you got to make your parlay card selections and received a free Monday Night Tee shirt. Over the years I must have collected 20 or 30 different shirts that I have tucked away somewhere in the garage. Today when you see all those Super Bowl proposition bets you can think of Sonny because it was he who started it all.
I don’t know who was responsible for hiring G.L Vitto but again the Castaways hit a home run. G.L. would do the Castaways advertisements on television. He was dressed in a referee black and white shirt with a whistle hanging from his neck. He would mumble something about Steve Garvey, who at the time was the Dodgers first baseman blow his whistle and signal the safe sign by moving his hands sideways. Whatever he said made no sense but it wasn’t supposed too. However, G.L. became a local television star and along with his success the Castaways prospered. He was funny, because he really was not funny. I guess the humor was in the incongruity because I laughed like many others. Was it any wonder the Castaways made money? It made so much money that it put the other Hughes casinos to shame but that’s another story. The complementary (comps) drinks and meals were handed out freely and often to anyone who asked. The drink tickets were unique in that they carried the name of the casino shift and/or pit boss. All one had to do was ask. I would think it rare to find any individual who ever paid for a drink at the Castaways.
During the 1970’s Congress passed the Bank Secrecy laws. Apparently drugs and money laundering were creating problems for enforcement agencies who wanted better laws that had teeth in their penalties. The Bank secrecy laws became Title 31 and with Title 31 came the $10.000 currency transaction forms and required reporting. Title 31 carried criminal punishment rather than the civil penalties under Title 26 of the Income Tax laws. The Internal Revenue Service was given responsibility over certain aspects of Title 31 around September,1985.
For whatever reason and/or political influence Nevada casinos avoided coming under the requirements of Title 31. The Nevada gaming authorities would have the responsibility of enforcing Nevada’s Regulation 6a. Regulation 6a resembled Title 31 so closely that it was scary; except for a very important early provision. The early provision exempted currency reporting requirements if the cashing-in of chips at the cage could be verified as coming from a gaming win. In other words the individual gambler won the chips playing at the casino games it would not be necessary for the casino to report the individual on an over $10,000 transaction. Today I believe chips are treated the same as cash for regulation 6a purposes. Also, I believe there is a "suspicious person" clause that has been added. It requires a casino to take down information if they believe the person cashing chips appears suspicious regardless of the transaction dollar amount.
In addition, another provision of Regulation 6a exempted from the reporting requirements a transaction for a player who exchanged a large denomination chip for smaller denomination chips. I believe the exemption for this type of transaction is still in effect today. Hence was born the need for the casino to have large denomination chips especially in sport books. The casinos with sports books would order oversize chips and some of them would establish separate "banks" for taking and placing bets. To the best of my memory the first casino to do this was Binion’s Horseshoe. Binion’s procedures for handling the oversize sport book chips was copied by many of the casinos downtown as well as on the strip.
In addition some of the casinos would supply safety deposit boxes, located within the cage, where the high denomination chips could be conveniently stored by the player. It was now an easy process for a sport book bettor to make his/her wagers in chips and be paid in chips for winning tickets. Obviously this type of transaction was a verified gaming transaction. The problem it created is that it simplified the process for "laying off" illegal wagers by those individuals who did not want to bring attention to themselves. It also made easy the process of converting $5,000, $1,000, etc chips into $1,000 and $100 dollar chips respectively without worrying about the reporting requirements.
It has been alleged that Nevada, since it is the only State in the Union, that allows full fledged betting on sports, has been/is the focal point for all illegal sport book betting and those who operate it too "balance their books" by laying off wagers they are side heavy on. The oversize sport book chips, whether knowingly or unknowingly by casinos, facilitates this process.
John L. Smith wrote in May of 2000…
Sunday, May 07, 2000
Copyright © Las Vegas Review-Journal COLUMN: John L. Smith
All eyes are on Artie B. -- hopefully Congress' as well. Bodendorfer is a key figure in an investigation of what authorities believe is a massive illegal bookmaking operation that stretches from Las Vegas sports books to several major cities. Last week, the state Gaming Control Board and FBI served dozens of search warrants and seized millions in cash from Bodendorfer and numerous other gamblers in a case that promises to reverberate from here to Congress…
The Castaways had oversize sport book chips. As I was told years ago the reason why they had oversize chips was to "facilitate the gaming process". They wanted to be competitive with other Nevada sport books and offer the same amenities to sport book bettors that they could get elsewhere. The Castaways was not breaking any law and "why shouldn’t they be allowed to be competitive".
I have no knowledge that the Castaways was involved in any illegal sport book activity. I saw the oversize chips being used. So have many others. I was often in line making my Monday Night Fever parlay wager watching large wagers being made with those very sport book oversize chips. They were Bud Jones metal centers. I can not and do not remember the colors or inserts. At that time, I had no interest in such matters. However, I will say this I know of no other Castaways oversize sport book chips that have surfaced, since the 1987 closing, except those that are currently in collectors hands. But Jim, Bud Jones has no record of making oversize sport book chips for the Castaways. Maybe the statement should be: Bud Jones can not FIND any record that they made oversize sport book chips for the Castaways. Too many individuals have seen them while visiting the Castaways. Take the following statement posted on Greg Susong’s Chip Board by Jim Kruse, the current Building Project Finance Committee Chairman for The Casino Chip and Gaming Token Collectors Club, Inc.
Castaway Sports Book Chips
Posted By: Jim Kruse
Date: 12/15/01 1:37 a.m.
I have been reading the treads on the Castaways $500 and $1000 Sports Book chips. I don't know if they were ever used, but I do know they were real chips in the Castaways inventory. Bill Freidman, the General Manager of the place was holding hourly drawing, giving away everything in the place including the giant sign on the building. The Sports Book chips were in an acrylic case with a bunch of other items they were drawing for and I was so dumb I asked the Lady if I could cash them in if I won one (I didn't win). She laughed and said no. Jim
I could go on and on posting previous Chip Board messages from others supporting the fact the Castaways oversize sport book chips did in fact exist. Here is a post from James Campiglia noted chip authority and author of "The Official U. S. Casino Chip Price Guide".
Posted By: James Campiglia
Date: 12/13/01 2:41 a.m.
In Response To: Can anyone refute this information? Castaways $500 (JimF@Work)
My information is 100% correct in my "Official" book on this one. I personally sold Jerry Wall 400 to 500 of each of these: $100, $500 regular, and $500 & $1,000 Race & Sports. Some were 400 & some 500 in the old brown chip boxes. OR did Bud Jones use these still in the mid 80's? Many were given to employee's upon leaving. Also there was a promotion to win these chips which were in a plastic round box like with a big sponge inside. Somehow you would get tickets playing & when they were closing you could redeem them for chips. Never quite understood that. Why they were aloud to give out chips when they closed or that last day it actually was open. Quite a few of the $5 & $25's were sold off too but I was not involved. I picked up a box of $1's once. These sure sell well. Wish I had more!
I guess there isn’t much more to say about the Castaways oversize sport book chips. However, there is much more to say about the Castaways. I’ll leave it for another article in the future. I would like to thank my good friend and fellow chip collector Andy Hughes for allowing me to post my articles on his web site. I would also like to thank Mr. David Spragg for sufficiently irritating me. If it wasn’t for Mr. Spragg unintentionally providing the motivation for me to write again with his authoritative written conclusions such as…"Castaways never had any genuine chips above $500 delivered, neither did they have any Sports Book chips of any denomination." I probably would have never written this article. In addition, I wish to thank all those individuals who have crossed my path over the 30 plus years I have lived in Nevada for providing the background color for my articles.
I’ll be back in a month or two with another article. Wait a minute…do I hear a siren coming from Foxy’s Firehouse Casino? Must be old Abe, God rest his soul, turning that siren. Boy! Could I go for pastrami on rye. To "borrow" an expression from a Card Player author I admire…"Don’t forget to turn out the lights on your way out"