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MEMO, -SAC t August 21, 1946 Re: BENJAMIN "BUGS" SIEGEL construction of the casino at the Flamingo Hotel, asking him when the const was started and where the money was coming tron. +o 14 Rc he gave the agents everything they asked for an told them everyt bout the Flamingo which he ht was very little. then stated tha ol that he was going to call the F.B.I., that he has a lot of friends there, uld find out just what the F.B,I. is looking for. Later he told that he had called the F.B.I. and found out that they are trying ap to determine two things. First, did any one receive a bribe in connection b € with the construction of the Flamingo i Hotel and secondly where does BEN SISGEL got his money? qu then suggested to thathe have SIEGEL go to the F.B.I. in Las Vegas and ask oo — ey wanted. aid no he would not do that; that the F.B.I. should come - to ee said that the F,B.I. would not come to SIBGEL, - that he would have to go to the FBV], SIEGEL said-he would think that over. ae yesterday for campaign > expenses. He said Cc 8 already cooperating with them. _- In this connection, old SIEGEL that when he next sces Senator MC CARRAN to tell MC CARRAN that if the F.B.I. should ‘aa - hin that he should play dumb and advise that he knows nothing about STEGEL, et al. STEGEL then atated that he gave The discussion then turned again to obtaining a loan and they talked about getting s loan from the Reconstruction Finance Corporation. Their discussion alsc indicated that they believe we are interested in determining whether a bribe was given to to secure approval for pre the construction of the Flamingo Hotel. said if that is what the “ F.B.I. is after let them go ahead and investigate thet; indicating that he was not worried about such an investigation. They then discussed plans they have for pouringaconcrete floor, concrete walls and roofs which will physically connect all of the buildings at the Flamingo Hotel project. They feel that this will completely fool the C.P.4. They are also going to erect a high fence completely around the Flamingo Hotel project in order that no one can see what is going on there. at this time 1 told Qne: tn view of the attitude of the C.P.A. toward me at San Francisco, we would hold up our open investigation of the Flamingo Hotel until after the next C.P.A. hearing iia on September Sth. I st,ted that since the C.P.A. at San Francisco told me that they feel they could make a case, we would await the outcome of their investigation and if they have another hearing it might prowke SIEGEL into again attempting to bribe or corrupt some offici which might give us an opportunity to get a better violation on him, We 22 ee0 with this procedures. JOE" A. BE. OSTHOLTHOFF ASO . ; =f 62- Lye : P