State Held Aware of Possible Skimming : Paper on Scheme Alleged at Laxalt Casino Revealed in Transcript

California law enforcement officials had knowledge that money may have been skimmed from a casino during the time it was owned by Sen. Paul Laxalt (R-Nev.), a transcript in a $250-million libel suit filed by Laxalt shows.

Laxalt underwent four days of pretrial questioning in October in Washington, D.C., in his suit against McClatchy Newspapers of California for its 1983 story that charged that a casino under his direction was skimmed of at least $2 million in the early 1970s. Skimming is the illegal practice of removing part of a casino’s profits before taxes are paid. Laxalt was a major owner of the Ormsby House in Carson City at the time.

He has denied the charge.

A transcript of the Laxalt 977-page deposition, obtained by United Press International, reveals for the first time the existence of a document from the California Department of Justice, dated Nov. 29, 1973, that was written by the Organized Crime and Criminal Intelligence Branch.

It said information from casino employees indicates “money is skimmed from the tables by a pit boss at each change of shift and is kept (in) the office until picked up by (businessman Rocco) Youse.”

The report said 15% to 25% of the casino take was kept by casino manager Joe Viscuglia, who turned it over to Youse, identified as a “front man” for underworld figure Frank Balistrieri.

The name of the person who wrote the report was blanked out. McClatchy attorney James Brosnahan said that Laxalt attorney Jim Beasley refused to allow Laxalt to answer questions about the California report because its sources were not identified.

Laxalt said that he never met Youse and only casually knew Viscuglia. He said that he knew little about the gambling operation, relying on others for safeguards.