The Horse Racing Wire Wars: Bugsy Siegel, the Mob and the Business Behind Every Bet
Before internet sportsbooks, satellite broadcasts and instant racing results, organized crime discovered that controlling information could be just as profitable as controlling the gambling itself. The resulting battle involved some of America's most notorious gangsters, a murdered wire-service executive and an enduring mystery surrounding Bugsy Siegel.
Imagine running a betting parlor in Los Angeles in 1946. A horse race has just finished at a track thousands of miles away. Somewhere, somebody already knows which horse won. Your customers are still standing at the counter, ready to place wagers, and you have no idea the race is over.
That is a very expensive position for a bookmaker to find himself in.
The solution was the horse racing wire, a communications network that delivered race results, odds, scratches, jockey changes and other information to gambling establishments across the United States.
The wire service was an essential tool of the off-track betting business. Whoever controlled it could determine who received information, how quickly it arrived and how much bookmakers would pay for access.
By the 1940s, those questions were being answered by men whose names would become legendary in organized crime: Benjamin "Bugsy" Siegel, Meyer Lansky, Jack Dragna, Mickey Cohen, Tony Accardo and others.
The business was enormously profitable. It also became extraordinarily dangerous.
How Did the Horse Racing Wire Actually Work?
Long before today's electronic wagering systems, bookmakers depended upon a network of track observers, telegraph operators, telephone lines and regional information distributors.
Some services maintained authorized reporters inside racetracks. Others relied on spotters positioned nearby, sometimes communicating with mirrors, signals or observers using telescopes.
A central organization collected information from the tracks and transmitted it to regional offices. Those regional offices relayed the data to individual bookmakers, often through leased telegraph lines, teleprinters or telephone connections.
Track observers collected race results, odds, scratches and other important developments.
Telegraph and telephone networks transmitted information to central distribution offices.
Regional companies distributed racing news to bookmakers and betting establishments.
Bookmakers used the information to manage wagers, update odds and close betting when races ended.
This created a practical problem for any bookmaker who refused to subscribe. A customer with faster information might attempt to place a wager after a race had already been decided, a practice known as past-posting.
Even honest bookmakers needed current information to adjust their books and manage their exposure. Without it, a betting establishment could find itself hopelessly behind competitors.
A few seconds of delay could make the difference between keeping a profitable book and paying a winning wager that should never have been accepted.
The wire operators did not need to pick winners. They collected payment from the people who took the bets, often regardless of how those wagers turned out.
In some territories, access to the information came with another demand: surrender a percentage of the bookmaking business.
Chicago: Where the Race Wire Empire Began
The race-wire business had roots in the early 1900s, well before Bugsy Siegel arrived in Las Vegas.
Chicago gambling operator Mont Tennes was among the early figures who recognized the commercial potential of delivering horse racing results rapidly to betting parlors. Early systems associated with telegraph operator John Payne demonstrated that gambling information could be gathered at a track and transmitted to bookmakers in distant locations.
The business expanded dramatically under publishing entrepreneur Moses L. Annenberg, whose Nationwide News Service developed an extensive racing-information distribution network.
Annenberg understood newspapers, distribution routes and the value of being first with information. Racing news, unlike yesterday's newspaper, could command a premium because a delay might cost the buyer money.
Following Annenberg's withdrawal from the business in 1939, Continental Press Service emerged as the dominant national racing-information provider.
Important figures in Continental's development included James Ragen, Thomas Kelly and the McBride interests of Cleveland.
Continental's network supplied racing information through distributors operating in cities throughout the country. Many of its ultimate customers were illegal bookmakers.
The company itself operated through a corporate structure and presented its business as the lawful distribution of news. Congressional investigators would later question how much influence organized-crime figures exercised over its distribution network.
Bugsy Siegel Takes the Wire West
Benjamin "Bugsy" Siegel arrived in Southern California during the 1930s after establishing himself in New York's criminal underworld alongside Meyer Lansky.
Hollywood offered money, celebrities, gambling and an entirely new territory for expansion.
Siegel became involved in bookmaking and the distribution of horse racing information across the Southwest. Nevada was particularly attractive because gambling had been legalized in 1931, and off-track race betting became legal there in 1941.
Siegel and his longtime associate Moe Sedway developed a network serving Las Vegas gambling establishments. Sedway handled much of the local operation while Siegel continued conducting business in California.
Through local services associated with the Golden Nugget and other downtown gambling operations, the organization provided racing results to bookmakers and casino race books.
A 1951 U.S. Senate investigation described Siegel's control over Las Vegas racing information as so extensive that bookmakers could be denied service unless Siegel or his associates were permitted to participate in operating their businesses.
Historian Larry Gragg has estimated that Siegel's race-wire operations produced approximately $25,000 a month in income for him during this period.
That was serious money in the 1940s, especially for a business that required considerably less glamour than the hotel Siegel would eventually build on the Las Vegas Strip.
And there was the attraction: a bookmaker might have a terrible Saturday at the races, but his wire-service bill still had to be paid.
The Men Behind the Horse Racing Wire
The race-wire business drew together gambling entrepreneurs, newspaper distributors, Mafia leaders and the men who carried out their instructions. Their relationships often shifted between cooperation and confrontation.
Benjamin "Bugsy" Siegel
Siegel established a powerful position in the Southwest's bookmaking and racing-information business. Through associates, he controlled access to important wire services in Las Vegas and participated in the Trans-American network. The wire was a major source of revenue before his death in 1947.
Moe Sedway
A longtime associate of Siegel and Lansky, Sedway helped establish and manage race-wire operations in Las Vegas. He dealt directly with local bookmakers and casino interests. After Siegel's murder, Sedway remained a powerful figure in the city's gambling business.
Meyer Lansky
Lansky was Siegel's longtime business associate and an important figure in national gambling syndicates. His relationships and investments helped connect the Western operations with established criminal enterprises in New York and other cities. He was also an investor in Las Vegas casinos.
Jack Dragna
Dragna headed the Los Angeles Mafia and participated in efforts to control California's racing-information distribution business. He worked with Siegel on Trans-American-related ventures and operated associated distribution enterprises, including West Coast News and Globe Distribution.
Mickey Cohen
Cohen became involved in the battle over racing information in Southern California. Congressional investigators linked him to intimidation of competing wire-service operators. His influence in Los Angeles gambling expanded after Siegel's death, although popular portrayals often exaggerate his earlier rank.
Joe Sica
Sica worked alongside Mickey Cohen in attempts to disrupt competing racing-information distributors. The 1951 Senate investigation described Cohen and Sica as acting on behalf of Jack Dragna during an assault on Continental-associated distributor Russell Brophy.
James Ragen
Ragen was a central figure in Continental Press and resisted attempts by Chicago gangsters to gain greater control of the business. After warning authorities about threats to his life, he was shot in Chicago in June 1946 and died several weeks later. His killing intensified scrutiny of the racing-information industry.
Tony Accardo & Jake Guzik
Accardo and Guzik were leading figures in Chicago's organized-crime syndicate. Senate investigators tied the syndicate to R. & H. Publishing, a racing-information distributor that competed with the Continental system and helped finance the rival Trans-American operation.
Gus Greenbaum
Greenbaum was closely associated with Siegel's gambling interests in Phoenix and the Arizona race-wire business. He later became a major Las Vegas casino executive and assumed control of the Flamingo alongside Sedway and Morris Rosen following Siegel's murder.
Moses L. Annenberg
Annenberg developed Nationwide News Service into a major racing-information distributor. His earlier network helped establish the business model later used by Continental Press. He had withdrawn from the operation years before the final stages of the 1940s wire-service conflict.
Thomas Kelly & the McBrides
Thomas Kelly and the McBride family were central to Continental's management and ownership arrangements. After Ragen's death, Edward McBride became the company's owner of record, although Senate investigators questioned whether he exercised meaningful control over the operation.
Morris Rosen
Rosen was associated with Siegel's Las Vegas interests and became involved in the Flamingo's ownership following Siegel's death. Alongside Moe Sedway, he attempted to maintain influence over the local racing-information business, which remained a source of conflict.
Continental Press vs. Trans-American: The Wire War
By the middle of the 1940s, an increasingly aggressive struggle had developed between Continental Press and a competing operation known as Trans-American Publishing & News Service.
Continental already possessed a nationwide network. Trans-American sought to establish a competing system with financial backing from gambling interests and organized-crime operators.
The 1951 Senate investigation reported that Trans-American received a $12,000 loan from Bugsy Siegel. Other backing came through the Chicago-based R. & H. Publishing organization and additional distributors.
Trans-American's operators were not simply competing for subscribers. In several cities, competition involved threats, damaged communications equipment and violence directed against people connected to rival services.
In Southern California, Mickey Cohen and Joe Sica were implicated in an attack on Russell Brophy, a Continental-associated distributor and son-in-law of James Ragen.
In Chicago, Ragen was fighting demands from powerful underworld interests seeking a greater stake in Continental.
Ragen warned prosecutors that he feared for his life. In June 1946, he was ambushed and wounded by gunfire. He died in August. His death was widely regarded as part of the struggle over the racing-information industry, although no court established who ordered the killing.
With Ragen gone, Continental's ownership arrangements changed. Trans-American eventually ceased operating, leaving Continental in a strengthened position.
Congressional investigators found the timing and circumstances suspicious. They also documented unusually favorable arrangements subsequently extended to distributors associated with the former rival operation.
A remarkable amount of bloodshed, bargaining and corporate maneuvering had taken place over the delivery of horse racing information.
The $12,000 Connection
Among the most revealing findings of the Senate organized-crime investigation was a reported $12,000 loan from Benjamin "Bugsy" Siegel to Trans-American Publishing & News Service.
The financial connection places Siegel directly in the national conflict involving Continental Press, Trans-American and Chicago underworld interests.
The investigators also reported that Trans-American went out of business only days before Siegel was murdered in Beverly Hills on June 20, 1947.
The timing is historically significant. It does not, by itself, prove a connection between the collapse of the competing wire service and Siegel's death.
Was Bugsy Siegel Murdered Over the Horse Racing Wire?
On the evening of June 20, 1947, Siegel was shot through a window while sitting in the Beverly Hills residence of his girlfriend, Virginia Hill.
He was 41 years old. His murder remains unsolved.
The most frequently discussed explanation is that organized-crime investors had become furious over the cost of the Flamingo Hotel and suspected Siegel of mishandling or diverting their money.
But the horse racing wire has remained another possible motive.
Siegel had controlled valuable gambling-information territory throughout the Southwest. His business decisions created enemies among rival operators, dissatisfied bookmakers and associates who disagreed over money and authority.
The Mob Museum has reported that investigators considered disputes involving the race wire, including tensions between Siegel and Moe Sedway.
Other historical theories focus on Los Angeles underworld figures, the Chicago syndicate, personal conflicts or the Flamingo's finances.
None has been conclusively established as the reason for the shooting.
One important detail is that the wire-service industry had undergone major changes shortly before Siegel's death. The disappearance of Trans-American and the consolidation of Continental's position created new financial relationships among the remaining operators.
Whether those changes contributed to the decision to kill Siegel is still a matter of speculation.
What Happened to the Wire After Siegel's Death?
Siegel's death did not end the business.
Moe Sedway, Morris Rosen and Gus Greenbaum remained influential in Las Vegas gambling, and the struggle over access to racing information continued.
Some casino operators resented arrangements under which receiving racing information could require surrendering an interest in their betting operation.
The conflict became so serious that public officials began examining the competitive and public-safety consequences.
In one particularly memorable episode, a Las Vegas gambling club reportedly placed a microphone where it could overhear racing information being received by a neighboring competitor.
The operators apparently preferred listening through the wall to paying the people who controlled the service.
Nevada eventually changed its regulatory approach, requiring access to racing information for licensed operators rather than allowing distributors to exercise unrestricted control over who received service.
National attention intensified during the 1950-1951 Senate investigation of organized crime led by Senator Estes Kefauver.
On November 15, 1950, the committee held hearings in Las Vegas. Witnesses described how racing information had been used to control bookmaking businesses.
William J. Moore, a member of the Nevada Tax Commission, testified about Siegel's influence and the financial demands associated with obtaining service.
The hearings helped expose how a communications business could provide organized crime with influence far beyond simply charging a fee for information.
A bookmaker did not need to belong to the Mafia to become financially dependent upon it.
The Horse Racing Wire Timeline
Telegraph-based racing-information services develop, allowing bookmakers to receive results from distant racetracks more rapidly.
Moses Annenberg's Nationwide News Service establishes a major national distribution system for horse racing information.
Annenberg withdraws from the racing-information business. Continental Press emerges as a successor organization.
Siegel and Sedway expand racing-information operations in Las Vegas, where legal bookmaking creates a valuable new market.
The Continental Press and Trans-American conflict intensifies. James Ragen is shot in Chicago and dies weeks later.
Trans-American ceases operating. On June 20, Bugsy Siegel is murdered in Beverly Hills.
Nevada examines the race-wire monopoly and strengthens the rules governing access to racing information.
The Kefauver Committee investigates organized crime, exposing the influence of the racing wire on bookmaking and gambling operations nationwide.
From Mob-Controlled Wires to Modern Horse Racing Data
The technology that made the racing wire valuable eventually became commonplace.
Television, improved telephone networks, computerized wagering, electronic data distribution and the internet radically changed how horse racing information reached the public.
Today, bettors can follow live odds, scratches, race results, past performances and wagering pools from computers and mobile devices.
Modern licensed betting operators obtain racing data through commercial and regulatory arrangements that are far removed from the territorial rackets of the 1940s.
Yet the original business insight remains familiar. Reliable information has value, particularly when it arrives faster than competitors can obtain it.
The difference is that today's horseplayer can check the outcome of a race from almost anywhere without first making a financial arrangement with one of Chicago's most notorious gangsters.
The Business Behind the Betting Business
Histories of organized crime usually focus on casinos, nightclubs, gambling ships, lavish mansions and the men who controlled them.
The horse racing wire was less glamorous, but in many ways it was more important.
It connected bookmakers across the country. It created recurring revenue for those who controlled distribution. It brought New York, Chicago, Los Angeles, Phoenix and Las Vegas into the same financial network.
And it generated disputes that could turn deadly.
Whether the race wire ultimately cost Bugsy Siegel his life remains unknown. What is clear is that the fight to control horse racing information helped shape the organized-crime economy of the 1940s and the early development of Las Vegas gambling.
The men may have worn expensive suits, driven Cadillacs and frequented the finest hotels, but some of their most profitable business came down to a remarkably simple question:
Who knew the winning horse first?
Frequently Asked Questions About the Horse Racing Wire
What was the horse racing wire?
The horse racing wire was a communications system that transmitted race results, odds, scratches and other information from racetracks to bookmakers, casinos and other subscribers. It became particularly important before television and electronic wagering systems made racing data widely available.
Did Bugsy Siegel control the horse racing wire?
Siegel controlled important racing-information distribution operations in Las Vegas and other parts of the Southwest through associates including Moe Sedway. He did not control every national wire service, but his regional influence was substantial.
What were Continental Press and Trans-American?
Continental Press was the dominant national racing-information distribution company during much of the 1940s. Trans-American Publishing & News Service was a competing operation supported by various gambling and organized-crime interests.
Was James Ragen murdered over the racing wire?
Ragen, a leading Continental Press executive, was shot in Chicago in 1946 after reporting threats associated with efforts to gain control of the business. He died weeks later. His death became a central episode in investigations of organized crime and racing-information distribution.
Was Bugsy Siegel killed because of the race-wire business?
That remains one theory surrounding Siegel's unsolved murder on June 20, 1947. Other theories involve the Flamingo Hotel's finances and personal or underworld conflicts. No explanation has been conclusively proven.