Davidson, Bill.The Mafia:
Shadow of Evil on an Island in the Sun

SE Post Feb 25, 1967 vol 204 issue 4 p. 27 - 37

The smell of a police state is still on the Groves enclave, which he calls Freeport. A restaurant manager named Rico Heller was fired from his job by a Groves lieutenant one evening after a disagreement. At three o'clock he was awakened by immigration officers pounding on his door. They ordered him off the island in four hours, leaving his belongings and property behind. A Negro Bahamian taxi driver named Dennis Hall, who somehow fell into disfavor, received an official notification that he could no longer set foot in the Freeport enclave—half his own native land—because the Hawksbill Creek Act gave Groves's Grand Bahama Port Authority "the absolute right to exclude any person and vehicle."

Despite such peculiarities, Freeport has developed phenomenally due in large part to a lack of taxes. Many reputable American, Canadian and British investors have poured in money, and the once-barren island now has a cement plant, a ship-refueling station, factories, housing developments, hotels, shops, restaurants, golf courses, churches and schools. All this is mainly for the whites. The Negroes, for the most part, live outside the enclave in wretched settlements like Eight Mile Rock, a shantytown of 10,000 or more people, without running water, sanitation or telephones. The single school is grossly overcrowded with pupils, and Groves is helping build another.

In Freeport itself, Groves and his corporations own most of the land, the harbor, the airport, the public utilities, the taxi company—and almost everything effecting the life of the island. He gets up to 10 percent of the gross receipts of the supermarkets, the theaters and other enterprises. Much of what remains is owned by Groves's friends in the United Bahamian Party, the white merchant princes of Nassau's main commercial avenue, Bay Street (they call themselves "the Bay Street Boys"). One of the beneficiaries of all this commerce is Sir Stafford Sands. As lawyer for Groves and many of the Bay Street Boys, he collects legal fees on nearly every important commercial transaction on Grand Bahama—a take that might total in the millions.

It is unclear whether Groves, Sands or both conceived the idea of sweetening the pot by importing legalized gambling into Grand Bahama. Some U.S. Government officials believe that this objective was in their minds as far back as the early 1950's when they first worked out the Hawksbill Creek agreement. The first known discussion of the subject took place at a secret meeting called by Groves on September 26, 1961, at the Fontainebleau Hotel in Miami Beach. Present at the meeting were Bahamian government figures and Louis Chesler, a freewheeling Canadian promoter as massive in size as Sir Stafford himself. Chesler, renowned for his impressive real-estate development activity in Florida, and just joined Groves as a partner in the Grand Bahama Development Co., which was selling building lots in Freeport.

In the winter of 1962-1962 Chesler was constructing the Lucayan Beach Hotel on Grand Bahama, when who should show up one day but Dino Cellini, Meyer Lansky's old right-hand man. Gambling was illegal in the islands, but the men building the Lucayan Beach obviously felt they could get around that problem. One former executive of Chesler's corporation recalls that what is now the Monte Carlo Casino was ostensibly built as a convention hall. The men referred to the room by a special code name—"the handball court." Cellini himself was in charge of designing "the handball court," with proper places reserved for slot machines, crap tables, etc. "They were that sure they were going to get an exemption to the anti-gambling laws," says the former executive, "and this was more than a year before the government even acted on it."

The planning of "the handball court" marked the beginning of a series of maneuvers which were strikingly similar to what was done in the 1930's to prepare Nevada for gambling. First, the plans for a large-scale public gambling casino were kept secret while potential sources of opposition were/neutralized. In Nevada the out-of-state gambling interests became the most generous financial contributors to churches and church schools. And so it was in the Bahamas. One clergyman, whom I interviewed in his rectory, admitted that he would not say one word against gambling. "The casino people donated my high school." Another minister told us, "I'm not happy about gambling, but it's the law of the land now and those people have been very helpful to us. The church got a free nine-hundred-and-ninety-nine year lease." The most vocal church opponent of gambling, Rev. Paul Blackburn, a Methodist, was recently recalled to England.
In the press, the principal threat to the proposed Bahamas gambling project was Sir Etienne Dupuch, a leathery, part-Negro crusader (now in his 60's and ailing), who owns and edits the colony's leading newspaper, The Tribune. For years Dupuch had been thundering editorially against the evils of gambling. In 1955 he had successfully squelched a previous effort to open a gambling casino on West End, another Grand Bahama resort. In 1961, however, The Tribune's anti-gambling editorials suddenly stopped. Shortly thereafter, The Tribune began to carry expensive full-page advertisements extolling the tourism and investment virtues of Freeport, which was the still mostly wilderness. The Dupuch family also publishes The Bahamas Almanac, a paperback guide to the islands. Although the handbook has a circulation of only about 10,000, the 1962 edition carried an estimated $50,000 worth of Freeport advertising.

Last year the Wall Street Journal revealed that Sir Etienne was actually on the payroll of Groves's Grand Bahama Development Co. as a "consultant" at $1,400 a month. In a letter to Groves dated February 20, 1964, Dupuch acknowledged receipt of at least two months' fees—$2,800. To this day, no one, including Groves, has been able to tell us exactly what Dupuch was supposed to do as a "consultant."

By March, 1963, the Groves-Chesler-Cellini operation was ready to take its case to the Bahamian government for an exemption to the anti-gambling laws. They went not to the legislature but to the governor's Executive Council, which then functioned as a cabinet. Their case was presented by none other than Sir Stafford Sands, who also happened to sit as a member of the Executive Council. The applicant was Bahamas Amusement. Ltd., whose shares were split equally between Louis Chesler and Groves's wife, Mrs. Georgette Groves. (Chesler resigned from the company in 1964.)

The "exemption" was granted on April 1, 1963. It provided that the company could operate casinos anywhere on Grand Bahama, just so long as they were "in, or in conjunction with, or in the vicinity of an hotel having at least two-hundred bedrooms." The Lucayan Beach Hotel happens to have 250 rooms.

Later Sir Stafford Sands, as attorney for Bahamas Amusements, Ltd., negotiated a license fee for the casinos with Sir Stafford Sands, the minister of finance. It turned out to be only $280,000 [£100,000] per year per casino (no matter how great the volume of business) plus $280 per slot machine. This was a ridiculously small sum. In Puerto Rico, for example, the well-regulated casinos have to pay 30 percent of their total earnings to the government.

The news of the "exemption" and its terms stunned the colony-especially since Huntington Hartford, the A & P multimillionaire, had previously been turned down on his offer to pay 50 percent of the proceeds to the government if he were given a gambling exemption for his Paradise Island resort in Nassau. It wasn't until 1966 that some of the details of this unusual cooperation between the Groves gambling combine and members/ of the Bahamian government began to leak out. The Wall Street Journal charged that it had uncovered records to prove that at least four members of the Executive Council had either been paid off by Groves's companies with "consultant" jobs à la Etienne Dupuch, or had otherwise profited. The four were Sands; the premier, Sir Roland Symonette; a dentist, Dr. Raymond Sawyer; and C. Trevor Kelly, then minister for maritime affairs. A fifth member of the government, Speaker of the House Robert Hallam Symonette (the premier's son), was also named. Sands, Sir Roland, Dr. Sawyer and Kelly all denied the allegations or refused to comment. Robert Symonette, a yachtsman, admitted that he had been retained as a "consultant" at $14,000 a year to advise on marina construction in the Groves enclave.

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