The Wire Service
Of course, Siegel wasnt sent to Los Angeles just to be on call in case Murder, Inc. needed some killing done. The West Coast was a huge, untapped resource for the mob and Siegels primary duty was to extend a specific Syndicate business to California.
Bookmakers need a quick, confidential and reliable method of reporting the winners of the thousands of horse races that they take action on. These wire services operate over a nationwide network, reporting anything that might have an impact on betting or the outcome of a race. The information they supplied included track conditions, jockey changes, scratches, post times and, of course, results. In addition, the wire services provided bookies with up-to-the-minute betting odds, which could tip them to fixes or unusually heavy action on a particular horse.
Race results on the legal Western Union wire were restricted by law. Western Union was only allowed to send the results after the race was declared official, which in many cases, a photofinish or an objection by a jockey, can be delayed by several minutes. This delay allows certain unscrupulous (and very gutsy!) bettors with inside information to take advantage of bookmakers by doing something called "past posting:" getting the unofficial results of the race and placing a bet before the bookmakers get the official finish. No serious bookmaker could dare operate without access to an illegal wire.
At the beginning of the 1940s, two major nationwide wire services were in operation. The first, more established service was called the Continental Wire Service, operated by a Chicago gangster named James Ragan. Also operating out of the Windy City was the service that had the backing of the Syndicate. Trans America Wire was owned and operated by the Capone gang with the assistance of Syndicate-backed thugs at the nations horse tracks.
One of Bens major tasks in the pre-war 1940s was to get California bookmakers to subscribe to the Trans America wire and drop Ragans service. Siegel and his helpers from Chicago concentrated on setting up Trans America in Nevada and Arizona before moving into California where Continental had a near-monopoly. It took him nearly six years, but Bugsy was finally able to eliminate Continental and James Ragan at the same time through standard mob strong-arm methods.
When Ragan was gunned down in Chicago cryptically, his last words were that "Dragna is the Capone of California," Continental fell apart quickly and Trans America took over. Expressing its profound appreciation to Siegel, Dragna and Jacks new lieutenant Mickey Cohen, the Syndicate back east told them it would now be handling the take from the wire services.
Bugsy balked at that. He was making $25,000 a month from the wire services operations in Las Vegas alone. In no uncertain terms, Siegel told the Syndicate to keep its mitts off the wire service; he would run it his way and keep the profits, thank you very much.
"I am gonna run the wire here," he told his friends back east. "And it is all mine."
Such defiance merited a death sentence; even Bugsy knew that. Siegel was virtually daring the Syndicate to come and get him.