The Battle for Montana: How The Big Sky State Became a Mob Turf War Between Seattle & Chicago, and How Chicago Won From New York's Waldorf-Astoria Hotel
By Michael Kelman Portney
Before we dive into another epic true mob story, I have to be clear about what this is. This is a reconstruction of the most likely circumstances, based on the evidence available. I make no claim that this is exactly what happened, however the evidence supports several inferences that may or may not help flesh out the full story.
What the Evidence Shows About a Forgotten Territorial Conquest
Between 1946 and 1957, a territorial war played out across Montana's scattered bars, casinos, and roadhouses. On one side: operators connected to Seattle's gambling machine networks, who had controlled Montana routes for years. On the other: the Chicago Outfit, sending two operators west with truckloads of machines and ambitions to claim the state as their own. The conflict lasted eleven years, involved hundreds of gambling machines worth millions in revenue, and was ultimately resolved not through violence but through the only mechanism that could settle such disputes in mid-century organized crime: Commission arbitration.
This is the story of what appears to have happened - a synthesis of documented facts, contemporary accounts, and logical inferences about one of the last great territorial conquests of American organized crime.
WHAT WE CAN PROVE: THE DOCUMENTED FOUNDATION
Seattle's Organized Crime Presence
Frank Colacurcio Sr., born June 18, 1917, to Italian immigrant parents in Seattle, entered the jukebox, cigarette, and vending machine business in the 1950s. According to his Wikipedia entry and contemporary accounts, "business rivals claimed he used threats to control the trade" throughout the Pacific Northwest. His operations extended across Washington, Oregon, and into neighboring states through an organization that, while not a traditional Mafia family, functioned as organized crime nonetheless.
In 1957, the U.S. Senate Select Committee on Improper Activities in Labor and Management - known as the McClellan Committee - subpoenaed Colacurcio to testify about his operations. He invoked his Fifth Amendment rights and told them nothing. But the subpoena itself confirms federal recognition of his organized crime involvement in the coin-operated machine business during the 1950s.
Chicago's Montana Operators
In 1946, two men arrived in Great Falls, Montana, within the same timeframe: Mike Gwon and Zollie Kelman.
Mike Gwon established the Park Hotel in Great Falls, creating a legitimate business presence that would serve as infrastructure for gambling operations. On January 1958 - nine months after a critical meeting we'll discuss later - someone planted a bomb under Gwon's Cadillac. The bomb was discovered before detonation. Contemporary newspaper accounts document this incident.
Kelman operated gambling machines in Montana for over sixty years. In 1988, he was arrested on 28 charges related to illegal gambling machine operations - charges documented in newspaper accounts and court records. He paid a $10,000 fine. According to a member of the Great Falls Historical Society, when Kelman died in 2008, he was "the second richest man in Montana."
The 1957 Convergence
On March 27, 1957, Zollie Kelman, age 32, applied for a marriage license in Minneapolis to marry Evelyn Masnick. They married on April 7, 1957.
The Minneapolis Star Tribune published three separate announcements about this wedding:
February 3, 1957: Engagement announcement stating "Zolly Kelman of Great Falls, Montana"
March 27, 1957: Marriage license announcement
May 4, 1957: Return announcement stating "Home in Great Falls, Montana following a New York honeymoon are Mr. and Mrs. Zolly Kelman"
Each announcement emphasizes Kelman's connection to Great Falls, Montana. The final announcement specifically mentions a "New York honeymoon" and uses the phrase "establishing home in Great Falls" - not returning, not visiting, but establishing.
The Commission Context
Frank Costello, known as the "Prime Minister of the Underworld," lived at the Waldorf-Astoria Hotel in New York in 1957. This is extensively documented in organized crime history. Costello was a Commission coordinator, and the Waldorf served as a neutral meeting ground for organized crime business.
On May 2, 1957 - approximately two weeks after Kelman's April New York trip - Costello was shot in an assassination attempt. He survived but began retiring from active leadership.
On November 14, 1957, over 100 organized crime figures met at a rural estate in Apalachin, New York. Police raided the meeting, creating a national scandal that exposed organized crime operations to unprecedented scrutiny.
The Federal Pressure
On January 30, 1957, the U.S. Senate created the McClellan Committee with Robert F. Kennedy as Chief Counsel. The committee would conduct 253 investigations, serve 8,000 subpoenas, and hold 270 days of hearings over three years.
In March 1957, Teamsters President Dave Beck - who controlled West Coast trucking and coin-operated machine distribution - testified before the committee and invoked his Fifth Amendment right 117 times. By May 1957, he was indicted for tax evasion.
Frank Colacurcio was subpoenaed by this same committee in 1957 to testify about his jukebox and vending operations.
These are the documented facts. Now we examine what they appear to mean.
WHAT THE EVIDENCE SUGGESTS: SEATTLE'S PRE-WAR CONTROL (PRE-1946)
According to the Great Falls Historical Society member scheduled for interview, punch boards - small gambling devices that let customers pay to punch out tickets for prizes - existed in Montana bars "long before Zollie got there." When asked about the source, he indicated these earlier operations had Seattle connections.
This makes geographic and logistical sense. Seattle sits approximately 800 miles from Great Falls. Between them: Spokane, a major distribution hub. The route from Seattle through Spokane to Montana was well-established for trucking operations. Dave Beck's Western Conference of Teamsters controlled this exact corridor through the 1940s and 1950s.
Montana in the 1940s was ideal territory for coin-operated gambling machines. Scattered population, hundreds of small-town bars, minimal law enforcement, and endemic corruption created perfect conditions for gambling operations. But Montana's remoteness also meant only operators with established supply chains could service it profitably.
Seattle operators had that supply chain. Colacurcio's organization (or its predecessors) could deliver machines through Teamsters-controlled trucking, service routes through local representatives, and collect revenue through periodic trips or trusted route men. Montana was peripheral to their main Seattle operations but still profitable - scattered bars each generating steady, relatively safe income from gambling devices that were technically illegal but rarely prosecuted.
The evidence suggests that by 1946, Seattle-connected operators controlled Montana's gambling machine territory through established routes, Teamsters logistics, and years of relationships with bar owners.
That control was about to be challenged.
WHAT THE EVIDENCE SUGGESTS: CHICAGO'S COORDINATED INVASION (1946)
The simultaneous arrival of Mike Gwon and Zollie Kelman in Great Falls in 1946 appears to have been coordinated strategy, not coincidence.
Gwon established the Park Hotel - legitimate business infrastructure that provided cover, coordination space, and a physical presence. Hotels serve multiple functions in organized crime operations: they're meeting places, safe houses for visiting operators, money-counting locations, and respectable fronts that generate community goodwill.
Kelman brought the gambling machines - the actual revenue-generating operations. According to local sources, he arrived with "a truckload of machines," suggesting Chicago sent him with substantial initial inventory.
The coordination between these two operators suggests deliberate planning. One creates infrastructure; the other runs gambling operations. Together they establish presence that looks legitimate (hotel operator and vending machine businessman) while building gambling operations backed by Chicago Outfit resources.
Why would Chicago want Montana? Several strategic factors appear relevant:
Geographic Expansion: Montana represented western expansion for a Midwest-based organization. Controlling Montana created a foothold for potential further expansion into the Pacific Northwest.
Untapped Revenue: Montana's hundreds of small-town bars represented steady income that Seattle was exploiting but not maximizing. Chicago had superior financing, organization, and political connections to grow the business beyond what independent Seattle operators achieved.
Limited Competition: Unlike Chicago, New York, or Kansas City - where multiple organizations competed - Montana was controlled by independent operators without Commission backing. Chicago was a Commission family. The power differential was enormous.
Training Ground: Montana could serve as a territory where Chicago could test and train operators for eventual promotion to more important territories.
The evidence suggests Chicago made a strategic decision in 1946: invade Montana, establish coordinated operations, and take the territory from Seattle through superior resources and organization.
WHAT THE EVIDENCE SUGGESTS: THE ELEVEN-YEAR WAR (1946-1957)
What happened between 1946 and 1957 in Montana appears to have been a territorial conflict fought primarily through economic pressure rather than violence.
The mechanics of such conflicts in the coin-operated machine business are well-documented from other territories:
Economic Pressure: The invading organization offers bar owners better terms - higher payouts, better machines, more reliable service. Bar owners face a choice: stick with existing operators or switch to the new organization offering better deals.
Political Pressure: The invading organization uses political connections to create problems for bar owners who resist. Liquor licenses come under scrutiny. Fire inspections find violations. Health inspectors arrive unexpectedly. Nothing directly connects to the gambling machines, but bar owners understand the message.
Supply Chain Disruption: The invading organization interferes with the existing operators' supply chains. Teamsters drivers refuse deliveries. Repair services become unavailable. Parts supplies dry up.
Protection Offers: The invading organization offers protection from problems that mysteriously began appearing when bar owners refused to switch. The protection is genuine - problems stop when bar owners cooperate.
Chicago had advantages in all these areas. As a Commission family, they had deeper resources, better political connections, and more credibility. When Chicago threatened, everyone knew they had the muscle to follow through. When Chicago promised protection, bar owners believed it.
Seattle's operators couldn't match these advantages. Colacurcio's organization used threats - this is documented in contemporary accounts - but they were independent operators competing against a major organized crime family. They couldn't offer the same terms, the same protection, or the same credibility.
The evidence suggests the conflict played out gradually over eleven years, with Chicago gaining increasing control while Seattle fought to maintain their existing routes. Bar owners in Great Falls faced competing operators, unclear authority, and pressure from both sides. The situation was unstable, potentially violent, and economically inefficient for everyone involved.
By 1957, something had to resolve the situation. The mechanism for such resolution in mid-century organized crime was Commission arbitration.
WHAT THE EVIDENCE SUGGESTS: THE McCLELLAN COMMITTEE CREATES URGENCY (JANUARY-MARCH 1957)
The creation of the McClellan Committee on January 30, 1957, appears to have created urgent pressure for the Commission to formalize territorial arrangements.
The committee's mandate was investigating "improper activities in labor and management" - exactly the area where organized crime had infiltrated most successfully through Teamsters-controlled trucking and coin-operated machine distribution. Robert F. Kennedy, as Chief Counsel, was aggressive, zealous, and determined to expose organized crime's role in American unions.
The Beck hearings in March 1957 were devastating. The president of America's most powerful union invoked the Fifth Amendment 117 times on national television. By May, he was indicted. The Teamsters - the union that provided logistics for coin-operated machine routes throughout the West - was under unprecedented federal scrutiny.
Frank Colacurcio was subpoenaed. Though he invoked his Fifth Amendment rights and said nothing, the subpoena itself demonstrated federal attention to Pacific Northwest gambling machine operations.
For the Commission, this created a critical problem. Ongoing territorial disputes - like the eleven-year Montana conflict - represented exactly the kind of instability that might attract McClellan Committee investigation. If Chicago and Seattle operators were openly feuding, if violence occurred, if bar owners complained to authorities about competing criminal organizations, the committee would investigate.
The Commission couldn't afford that scrutiny. They needed territorial arrangements formalized, disputes resolved, and everyone operating under clear authority before Congress exposed the chaos.
The evidence suggests the Commission decided in early 1957 that pending territorial disputes needed immediate resolution. Montana was among them.
WHAT THE EVIDENCE SUGGESTS: THE WALDORF ARBITRATION (APRIL 1957)
Zollie Kelman was 32 years old in early 1957. He had been operating in Montana for eleven years. He was unmarried.
In organized crime culture, an unmarried operator approaching mid-30s suggests instability. Marriage indicates commitment, permanence, responsibility - qualities the Commission evaluates when determining whether an operator can hold territory long-term.
The evidence suggests Kelman was instructed to marry before attending a Commission hearing about Montana's territorial status. According to family accounts, his brother warned him against marrying Evelyn Masnick due to genetic health risks in her family. Kelman reportedly proposed, "I suppose we could get married" - suggesting calculation rather than romance.
They applied for their marriage license March 27, 1957. They married April 7, 1957. Within days, they left for New York.
The Minneapolis Star Tribune published three announcements about this wedding - unusual attention for an ordinary marriage. Each announcement emphasizes "Great Falls, Montana." The final announcement specifically states "establishing home in Great Falls, Montana following a New York honeymoon."
The word choice appears interesting. Not "returning to Great Falls" or "residing in Great Falls," but "establishing home" - suggesting something new, something permanent, something official.
Frank Costello lived at the Waldorf-Astoria Hotel in 1957. This is extensively documented. Costello was known as a Commission coordinator - someone who facilitated Commission business, helped resolve disputes, and maintained communication between families.
The evidence suggests Kelman's "honeymoon" at the Waldorf-Astoria was a Commission hearing about Montana's territorial status. A couple on their honeymoon attracts no attention in a hotel under FBI surveillance. Meetings in hotel suites look like tourist activity, not organized crime coordination.
The Commission hearing likely evaluated several factors:
Possession: Chicago had operated Montana for eleven years. Reversing eleven years of established operations would be difficult and disruptive.
Organizational Capacity: Chicago Outfit was a major Commission family with vast resources. Seattle's operators were independents who couldn't match Chicago's political connections, financing, or muscle.
Strategic Importance: Montana was peripheral to Seattle's main operations but central to Chicago's western expansion strategy.
Operator Quality: Kelman could demonstrate eleven years of successful operations, growing the business to substantial scale, and now marriage indicating stability and long-term commitment.
The evidence strongly suggests the Commission ruled that Montana belonged to Chicago. Seattle had to withdraw.
For Seattle's operators, this meant the end of their Montana operations. You can't fight a Commission ruling without facing consequences from every Commission family. Colacurcio's organization was powerful in Seattle, but they weren't going to war with the Commission over distant Montana territory.
For Chicago, this was official recognition of a conquest begun eleven years earlier. Montana was now Commission-blessed Chicago territory. Any other organization wanting to operate there needed Chicago's permission.
For Zollie Kelman, this was elevation to coordinator status. He wasn't just a Chicago operator anymore - he was the Commission-blessed coordinator for Montana. Protected, permanent, official.
The May 4, 1957 newspaper announcement - "establishing home in Great Falls, Montana" - appears to be public notification of this new status. Anyone who understood the coded language would know: Montana has a coordinator now. Commission-blessed. If you need anything in Great Falls, he's the authority.
Two weeks after Kelman's return from New York, Frank Costello was shot in an assassination attempt. The careful coordinator who had arbitrated Montana's status was suddenly out of power. Seven months later, the disastrous Apalachin meeting exposed over 100 organized crime figures to police raids and national scandal.
Kelman had gotten his Commission blessing at precisely the right moment - under Costello's careful coordination, before the chaos that followed.
WHAT THE EVIDENCE SUGGESTS: THE AFTERMATH AND CONSOLIDATION (1957-2008)
In January 1958 - nine months after the apparent Waldorf meeting - someone planted a bomb under Mike Gwon's Cadillac. The bomb was discovered before detonation. This is documented in contemporary newspaper accounts.
The timing suggests a possible connection to the territorial settlement. Was this Seattle retaliating after being forced to withdraw? Was it local competitors angry about Chicago's formalized control? The historical record doesn't specify. But the bomb represents the only documented violence in this territorial conflict, and it occurred after the Commission apparently ruled, not during the eleven years of competition beforehand.
No similar violence followed. The bomb attempt failed, and Chicago's control remained secure.
For the next fifty years, Zollie Kelman operated Montana without significant competition. According to family sources, he built operations to approximately 700 machines across the state.
He developed political connections that protected him from serious legal consequences. The 1988 arrest on 28 charges resulted in a $10,000 fine - a minor penalty for someone who, according to Great Falls Historical Society sources, was "the second richest man in Montana" when he died.
The Colacurcio organization never returned to Montana. Frank Colacurcio Sr. continued operating in the Pacific Northwest, building strip clubs and entertainment venues that made him wealthy and powerful in Seattle. His Wikipedia page doesn't mention Montana - the territory was such a small part of his overall operations that losing it barely registered in the organization's history.
But in Great Falls, the protection structure that appears to have stemmed from Kelman's Commission-blessed status continued even after his 2008 death. According to Kelman's grandson, multiple Montana lawyers have refused to take cases involving the family - suggesting that protection, wealth, and influence continue to shield the family from legal challenges sixteen years after Kelman's death.
WHAT WE CAN'T PROVE: THE LIMITS OF THE EVIDENCE
While the evidence strongly suggests the narrative outlined above, intellectual honesty requires acknowledging what we cannot definitively prove:
We cannot prove the Waldorf-Astoria trip was a Commission meeting. The newspaper announcement states "New York honeymoon" and the couple did get married. It could have been an ordinary honeymoon, though the timing, location, and three newspaper announcements emphasizing Montana remain suggestive.
We cannot prove Commission involvement in the territorial settlement. We can document that Seattle operators controlled Montana before 1946, that Chicago operators arrived in 1946, that competition lasted eleven years, that Colacurcio's organization withdrew from Montana around 1957-1958, and that Chicago maintained unopposed control afterward. Commission arbitration is the logical explanation, but direct documentation is lacking.
We cannot prove Kelman's specific Commission status. Family accounts use phrases like "call Myron Sugarman," suggesting network coordination, and historical context makes coordinator status logical, but we have no Commission document stating "Zollie Kelman, Montana Coordinator."
We cannot prove the bomb attempt was related to territorial disputes. The timing is suggestive, but the historical record doesn't state motivations.
We cannot prove Kelman was "the second richest man in Montana." This comes from a Great Falls Historical Society source who hasn't yet been interviewed for full attribution and documentation.
We cannot yet prove direct connections between specific individuals in Chicago's hierarchy and Kelman's operations, beyond what family accounts suggest.
These limitations are significant. This narrative rests on documented facts combined with logical inferences about what those facts suggest, not on direct testimony or internal organized crime documents.
WHY THIS NARRATIVE MAKES SENSE: THE LOGICAL FRAMEWORK
Despite these limitations, the territorial war narrative makes sense for several reasons:
It explains the timing. Why would a 32-year-old unmarried man suddenly marry, honeymoon at a specific hotel known for organized crime coordination, and receive three newspaper announcements emphasizing Montana - all in April 1957, exactly when the Commission faced urgent pressure to resolve territorial disputes before the McClellan Committee could expose them?
It explains the outcome. Seattle operators who had controlled Montana pre-1946 withdrew by 1957-1958. Chicago operators who arrived in 1946 maintained unopposed control for fifty years. Territorial conquest followed by Commission arbitration explains this clean resolution better than coincidence or independent business competition.
It explains the protection. Kelman operated for sixty years with minimal legal consequences despite running illegal gambling operations. The $10,000 fine for 28 charges in 1988, the inability to get Montana lawyers to take cases against the family even today - these suggest protection beyond ordinary corruption. Commission blessing would provide exactly this level of protection.
It explains the wealth. "The second richest man in Montana" from gambling machine operations suggests more than local entrepreneurship. Commission-blessed territorial control, with tribute flowing up but substantial profits staying, explains this level of wealth accumulation over sixty years.
It explains the coordination. Two Chicago operators arriving simultaneously in 1946, one creating infrastructure and one running gambling operations, suggests organizational planning rather than independent initiative. This is how organized crime families coordinate territorial expansion.
It explains the newspaper announcements. Three announcements for one wedding, each emphasizing Montana, the final one stating "establishing home" rather than "returning," the specific mention of "New York honeymoon" - these details make sense as coded communication to those who understand what Commission blessing means.
The individual pieces of evidence - marriage, timing, location, announcements, territorial outcome, wealth, protection - each have alternate explanations. Together, they form a pattern that makes most sense as a territorial conquest story.
CONCLUSION: WHAT APPEARS TO HAVE HAPPENED
The evidence suggests the following narrative:
By the mid-1940s, Seattle-connected operators controlled Montana's gambling machine territory through established routes and Teamsters logistics. In 1946, the Chicago Outfit invaded this territory by sending two coordinated operators - Mike Gwon to create infrastructure and Zollie Kelman to run gambling operations. For eleven years, Chicago and Seattle competed for Montana territory through economic pressure, political connections, and organizational advantages that favored Chicago.
In early 1957, the McClellan Committee's creation forced the Commission to urgently resolve pending territorial disputes before federal investigations could expose them. Montana was among these disputes. In April 1957, Zollie Kelman - newly married to demonstrate stability - traveled to New York for what appears to have been Commission arbitration at the Waldorf-Astoria, where Frank Costello coordinated such business.
The Commission appears to have ruled that Montana belonged to Chicago. Seattle withdrew. Chicago maintained unopposed control for the next fifty years. Kelman became the second richest man in Montana through sixty years of protected, Commission-blessed operations.
This narrative rests on documented facts - dates, locations, people, events - combined with logical inferences about what organized crime coordination looked like in mid-century America. We cannot prove Commission involvement with direct documentation. But the pattern of evidence, the timing of events, the outcome of the territorial dispute, and the protection and wealth that followed all make sense within the framework of Commission-arbitrated territorial conquest.
The Montana territory war appears to have been one of the last great territorial conquests of American organized crime - resolved not through violence but through the mechanisms that governed organized crime in its mid-century golden age: economic pressure, political connections, and Commission arbitration.
And it was all apparently decided in April 1957, at the Waldorf-Astoria Hotel in New York, during what newspaper announcements called a "honeymoon" but what the evidence suggests was something else entirely.
