U.S. mobster's heirs to Cuba: You owe us -- so pay up

Mobster's family wants money for seized hotel
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Story highlights

  • Mobster Meyer Lansky thought he would strike gold in the 1950s Havana party scene
  • He lost in swanky hotel, the Riviera, and his investment when Fidel Castro seized power
  • His family is now insisting that Cuba's Communist government make restitution

Havana, Cuba (CNN)For Meyer Lansky, a mobster and casino impresario known for his business savvy, Cuba was the worst bet of his life.

In the 1950s, Havana was America's favorite playground. Gambling, sex shows and rum were plentiful. Lansky's hotel, the Riviera, was one of Havana's swankiest.
    "I mean it was a great spot," Lansky's grandson Gary Rapoport told CNN of the Riviera. "Any businessman would be terribly crushed if someone just came along and took it."
    That "someone" was Fidel Castro. After taking power, the Cuban revolutionary took away all Americans' property, targeting with particular vehemence the mafiosos who paid off Cuban officials to flout the law and turn the country into a den of vice for foreigners.
    Harassed by law enforcement in the United States, Lansky and his cohort Charles "Lucky" Luciano were able to operate freely just off American shores in Cuba.
    "Meyer Lansky was the first New York mobster to see the island's full potential," T.J. English wrote in the book "Havana Nocturne." "With a friendly government in Cuba, there was no telling what the Mob could accomplish."
    Cuban dictator Fulgencio Batista was all too happy to turn a blind eye to the mafia's activities as long as he got a cut of the profits. In Cuba's "business friendly" environment, Lansky built his dream hotel: the Riviera.

    'That was his baby'

    The Riviera was constructed in 1957 on the Havana seafront, and no expense was spared.
    "That was his baby," said Lansky's daughter, Sandra Lombardo. "When it opened, he would walk up all the stairs to make sure the air conditioning worked."
    "He wanted to build something that was above and beyond what everyone else had there," Rapoport said. "He figured that in about a year, he would've been paid off as far as the investment, and he didn't get that year."
    Instead, Castro, the young Cuban firebrand, waged a guerrilla insurgency that drove Batista into exile. Lansky and other members of the American mob fled Cuba as Castro seized their hotels and angry mobs destroyed their casinos.
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    The United States and Cuba broke off diplomatic relations as Castro aligned himself with the Soviet Union. Pursued by the U.S. government for the rest of his life, Meyer Lansky died in 1983 without being able to see the Riviera again.
    As President Barack Obama has repaired relations with Cuba though, Lansky's heirs have a new hope that they could be compensated for the loss of the hotel and other properties.

    Family: Cuba 'owes us'

    "I think it owes us," Rapoport said of the Cuban government. "We are the heirs of the estate of Meyer Lansky -- they owed Meyer Lansky."
    They face us an uphill battle though. Lansky never put in a claim with the U.S. government for the seized property.
    Cuban-American attorney Pedro Freyre said the Cuban government owes roughly $8 billion to U.S. individuals and companies who had their assets taken, adjusting for inflation. Cuban officials say the United States owes the island a far greater sum for the damages caused by U.S. economic sanctions.
    Freyre said that claimants to property connected to American mobsters such as Lansky are unlikely ever to see a dollar from the Cubans.
    "There was a decree of confiscation of any property of the Batista regime gotten through ill-gotten gains," Freyre said. "Properties that were confiscated have a tougher argument to get restitution."
    But the U.S.-Cuba relationship is rapidly shifting. On Sunday, Starwood Hotels announced deals to manage Cuban hotels, the first U.S. company to have properties in Cuba since the revolution.
    Rapoport said he is not interested in trying to recover the hotel, just to receive some compensation for his family's loss.
    Raised in the shadow of his notorious grandfather, Rapoport said the Lansky criminal empire has been wildly exaggerated.
    "There was a lot that was in the estate that never got to us. Do we cry about it? No, we are Lanskys. We just move on," he said.
    The Riviera is today a shell of the luxurious hotel Lansky created. Rooms are threadbare, and there is no water in the pool. But staff members still refer to the Riviera as "el hotel de Meyer Lansky."