Bank Auctions Capone's Hideout ... to Itself

Bidding starts at $2.6 million laundered dollars

By Steve Bryant
|  Thursday, Oct 8, 2009  |  Updated 3:56 PM CDT
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Chippewa Valley Bank

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Nobody got a steal on former Chicago mobster Al Capone's clandestine Wisconsin digs. 

The hideout did sell. But the bank that foreclosed on the property in the first place ended up buying it for $2.6 million.

Chippewa Valley Bank was the only bidder during a five-minute sheriff’s sale in the lobby of the county courthouse in Hayward, Wis.

About 30 to 40 people watched as Sheriff Jim Meier conducted the auction, according to Margie Schull of the Sawyer County, Wis., Sheriff’s Department.

The bank foreclosed on the 407-acre wooded site, which is about 150 miles northwest of Wausau, Wis., in April 2008 and said the minimum bid would be $2.6 million.

Bank Vice President Joe Kinnear did not immediately return a telephone call after the sale. He had said earlier today that he anticipated “10 to 15 bidders.”

Capone owned the land in the late 1920s and early 1930s during Prohibition, according to the bank. According to local legend, shipments of bootleg alcohol were flown in on planes that landed on the property’s 37-acre lake, then were loaded onto trucks bound for Chicago.

The two guard towers on the property reportedly were manned with machine guns whenever Capone visited.

The bank acquired the property after foreclosing on owner Guy Houston and his company, The Hideout Inc., according to court records. The Houston family bought the property in the 1950s from Capone’s estate and operated it as a seasonal bar and restaurant, known for its prime rib. It also offered guided tours focusing on the Capone lore.

Capone headed a massive bootlegging, gambling and prostitution operation during Prohibition that raked in tens of millions of dollars. He was widely suspected — but never charged — in several murders.

He was considered the mastermind of the gangland killing on Chicago’s North Side in 1929 known as the St. Valentine’s Day Massacre. Seven rivals of Capone’s gang were gunned down in a garage, but investigators never came up with enough evidence to put anyone on trial for the deaths.

Capone eventually was convicted of income-tax evasion and spent part of an 11-year sentence at the infamous Alcatraz prison. He died in 1947.

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