On eve of shutdown, arcade operators seek to retrofit machines, seek options

For Rick Scott, the “jobs” governor, the bill he will sign Wednesday to ban Internet cafes is as awkward as it gets.

The measure is guaranteed to put people out of work and, if the issue hadn’t come up, he would likely still have a lieutenant governor.

From Gadsden to Monroe counties, Internet cafe and adult arcade operators say an estimated 14,000 people will be forced into the unemployment lines as a result of the Legislature’s prohibition on casino game look-alikes.

Nonetheless, Scott said Tuesday, he will sign the bill and it will take effect immediately.

But the resilient industry, accustomed to living on the edge, is not ready to retire.

Many arcade operators, who were in business long before the upstart Internet cafes came into town, are preparing to hang on by reconfiguring their machines to accommodate the new law or challenge the law in court.

“We are currently working on a package to retrofit all machines to be able to comply with new laws,” Shawn Mosayov of E and D Trading, a supplier in Hollywood, wrote on a Facebook page.

Gaming law experts say the retrofit could involve using tokens worth $1 to $20 and allowing  players to collect prizes using a debit or swipe card. Others may offer pseudo prizes — such as giant Teddy Bears — that can be traded for cash at a shop next door. Story here. 

Absent regulation, Internet cafe operators face no criminal background checks

Three operators of Internet cafes stood before the Florida Senate Gaming Committee last month and urged them to have mercy on their industry.

They told them of the job-creating potential of their business, their practice of offering free meals and free food to patrons, and how their gaming centers were favorite destinations for senior citizens.

What they didn’t tell them about was their past brushes with the law — from larceny, grand theft, check kiting and witness tampering to arrests for operating illegal gambling houses.

Under Florida law, owners and operators of Internet cafes do not have to pass any criminal background checks to be in business in Florida. And only those companies that operate electronic sweepstakes games with prizes valued at more than $5,000 must register with the state Department of Agriculture and Consumer Services. Adult arcade operators do not have to register at all.

“The law is very vague, put in place for McDonald’s monopoly games,’’ said Erin Gillespie, a department spokeswoman. “It was never meant to be a loophole for gambling. The law doesn’t have a lot of teeth to it.”

Mary Lucas, the manager of the Shooting Stars Sweepstakes in Mineola, warned the committee that they would “be putting 16,000 of us out of work.”

“I have a family. My employees have families. We pay taxes and we are family to our customers,’’ said Lucas, 47, who also lists her last name as Gordon, and has seven misdemeanor worthless check charges against her and was convicted of embezzling $1,800 in Virginia in 1999. She could not be reached for comment Wednesday. More here.

Read more here: http://www.miamiherald.com/2013/04/03/v-fullstory/3321949/no-criminal-background-checks.html#storylink=cpy

Internet cafes' loss may be parimutuels' gain: legislators to ponder moving games

As the Florida Senate appears ready to outlaw the electronic slot machine-like games offered by Internet cafes, adult arcades and maquinita operators in Florida, there is talk that the machines will be resurrected next year.

Sen. John Thrasher, a St. Augustine Republican and chairman of the Senate Rules Committee, said Tuesday that he would like to consider allowing the machines to be operated at the dog tracks, horse traces and jai alai frontons throughout the state, which are currently regulated and paying taxes.

“As long as they’re regulated in the pari-mutuel facilities that’s something for us to talk about. I’ve always said if we are going to allow any expansion of gaming – which I’m not really for – the existing authorized, legitimate are where we should do it,” he said. 

Las Vegas-style slot machines are currently only allowed in the six parimutuel faciliites Miami Dade and Broward but in 2011 Thrasher proposed an amendment to a bill in the final hours of the legislative session that would have allowed the Jacksonsville greyhound track in his district to operate a copycat version, known as video lottery terminals, that allow players to play against each other, not the house. The amendment nearly derailed the end of session, but it didn't pass.

Now, Thrasher says, when the Florida Legislature returns next year to take a comprehensive look at the state's gambling laws, the issue should return. The House and Senate have set up select committees to study gaming regulation and come up with a proposal next year. The Senate committee is chaired by Sen. Garrett Richter, R-Naples, and the House's is chaired by Rep. Rob Schenck, R-Spring Hill.

“I suspect that when Sen. Richter does his deal next year that some of the pari-mutuels will come in and say ‘let us do it’ because we’re paying taxes – a high rate of taxes,'' he said.

 

 

Undercover slots expert lays out case against 'Internet cafes' and arcades

Working undercover as just another aging patron, D. Robert Sertell watched as customers streamed into Internet cafes in strip malls across Florida to buy access to Internet time or long-distance phone service.

As a national expert on slot machines, Sertell saw that the customers visiting the cafes operated by the Florida-based charity Allied Veterans of the World were not there to surf the web or make phone calls. They came to play what he contends are illegal slot machines, complete with spinning wheels, cash payouts, and names such as Captain Cash, Lucky Shamrocks and Money Bunny.

Using a mouse as their lever, and “sweepstakes” credits as their coins, customers played games that were nothing more than sophisticated, computerized slot machines, Sertell concluded after visiting 41 cafes, from Monroe County to Duval County, in early January.

“The little old ladies, whose eyes were fixated on the screen, would sit and play. Their hand never leaving the mouse,” he told the Herald/Times. “They refer to it as a casino. Every one of those machines is rigged. It’s a game of chance.”

Sertell, 71, known as “Father Slots” in the casino industry, is a slot machine expert from New Jersey who has built machines, written training and repair manuals and has become the expert of choice for law enforcement officials who want to know the difference between a computer that is rigged to operate like a slot machine and one that isn’t.

He is expected to be a key witness for state and federal prosecutors in arguing that the electronic sweepstakes machines run by Allied Veterans at their 49 Internet cafes in Florida were illegal gambling operations, operating under the guise of a charity. More here.

 

Scott remains noncommittal on Internet cafe ban

As the Florida House prepares to vote on its bill to ban Internet cafes in Florida, Gov. Rick Scott told the Miami Herald editorial board Thursday that he had not made up his mind on whether to support it or not.

"Everything is on the table,'' Scott said, refusing to indicate whether he supports the ban that has emerged as the Legislature's swift response to the criminal investigation into the Allied Veterans of the World, a chain of Internet cafes.

Police have arrested 57 individuals affiliated with Allied Veterans and have charged them with illegal gambling, money laundering and racketeering. The $300 million for-profit operation allegedly donated only 2 percent of its proceeds to charity.  

Legislators have quickly attempted to distance themselves from the fake charity, announcing they would donate thousands of dollars in contributions to legitimate veterans groups and other charities. According to a Herald/Times analysis, Allied Veterans and its operators and affiliates spent more than $1.4 million on candidates and committees in the last election cycle, most of it intended to influence the Florida Legislature. 

The Florida House raced to agenda a bill last week by Rep. Carlos Trujillo, R-Miami, that would clarify the state law to ensure that anyone operating electronic sweepstakes machines, adult arcades and maquinitas are illegal in Florida. 

The bill clarifies that web-based gambling devices are illegal because they are deemed games of chance and not games of skill. Trujillo said he will ask lawmakers to adopt an amendment today that clarifies that promotional giveaways, like those offered by fast food restaurants or car dealers, and children's arcades will continue to be allowed in Florida.

The ban is expected to shut down an estimated 1,000 gaming centers that have operated electronic casino-like games disguised as a sweepstakes or arcade games.

The bill clarifies existing law by prohibiting electronic gambling devices for charitable promotions, updates the definition of slot machines to include network-based machines like those used in Internet cafes and bans machines intended to simulate casino games and slot machines.

 

Legislators rush to return tainted campaign cash from Allied Vets chain

Shamed by the notion that they may have filled their political coffers with more than $1.4 million in campaign cash from a phony veterans group facing charges of illegal gambling, the Florida Legislature is scrambling to save face by donating the money to charity.

Rep. Steve Crisafulli, a Merritt Island Republican slated to be House speaker in 2016, sent a letter to his Republican colleagues Monday saying that he’s giving away the $3,500 in questionable cash he received to a local veterans group. He suggested other legislators do the same and even attached a list of the suspected companies.

“The information that has come to light regarding the Allied Veterans group and their affiliates is outrageous,’’ he wrote. “These allegations of fraud especially in the name of those who risk it all in defense of freedom and our nation — must be prosecuted and punished to the fullest extent of the law.”

Allied Veterans of the World and its 57 owners and operators have been charged with operating a $300 million racketeering, gambling and money laundering scheme under the guise of charity. A Herald/Times analysis found they used 60 different organizations and 34 individuals to steer more than $1.4 million to state and federal campaign accounts.

Investigators reported this week that one alleged conspirator, Nelson Cuba, former head of the Jacksonville Fraternal Order of Police, had $56,400 stuffed in a safe deposit box along with five million Iraqi dinars — worth $4,300. Police also seized $583,507 in cash, 59 vehicles and vessels, and froze $100.6 million in bank accounts, the Seminole County Sheriff’s office announced.

The list of politicians who were beneficiaries of the Allied Veteran’s political largess spans the political spectrum and reaches every corner of the state. More here. 

Absent a new accord, Calder and Gulfstream to race at same time

Eddie Plesa Jr. has been at Calder Casino and Race Course since the first horses hoofprints there. When the Miami Gardens track opened in 1971, his father was among the first trainers to set up shop.

Later, Plesa followed in his father’s footsteps, became one of the track’s top trainers, and supported the place in 1989 when it prevailed in a head-to-head racing battle against Hialeah — the only time in South Florida history that two of its three tracks ran concurrently.

“It was good to my parents,” Plesa said of Calder. “It’s been good to me.”

But Plesa’s long allegiance with Calder could soon end.

Unless a compromise is reached between Calder and Gulfstream Park, the two tracks will battle nose-to-nose starting July 6, a showdown that will force most trainers to choose sides.Mo re here.

Sen. Garrett Richter's Kentucky Derby ride offers a glimpse into Tallahassee's world

The head of the Senate Select Committee on Gaming has never served on a gaming committee and reminds people that he has a steep learning curve.

But Sen. Garrett Richter, R-Naples, is a horse racing fan who flew to the Kentucky Derby with Internet café lobbyist Dave Ramba and two other gaming lobbyists last year, where they sat on Millionaire’s Row. 

“I have been going to the Kentucky Derby every year since before I entered the Legislature,’’ Richter, a six-year legislative veteran, told the Herald/Times on Monday.

Richter’s wife and business partner, Gary Tice of Naples, also attended the event. Ramba told the Herald/Times Richter was one of “at least 20 to 30 legislators and that many lobbyists who took private jets to the Derby for House and Senate leadership fundraisers” during the May 4 and 5 event.

Unlike most years, the session began and ended early last year because of reapportionment and the Derby weekend was a perfect venue for collecting campaign cash for most lawmakers. But the high-end fundraiser, at one of the most prestigious gambling events in the nation, also offers a glimpse into the comfort with which legislators mingle with the same lobbyists who seek their votes.

Senate panel moves Internet ban amid vigorous protests from operators

A Florida Senate committee followed the House lead on Monday and passed legislation to clarify state law to ban electronic sweepstakes games operated at Internet cafes in strip malls across the state.

The move comes less than a week after a federal and state investigation led to the arrest of 55 individuals in Florida and five other states on racketeering and corruptions charges linked to gaming centers run by the Allied Veterans, a purported charity that gave only 2 percent of their proceeds to veterans.

The fallout also prompted the resignation of Lt. Gov. Jennifer Carroll who previously represented the Allied Veterans in her consulting company and has led to one of the fastest legislative responses to a gambling probe in decades. 

The Senate Select Committee on Gaming voted unanimously to pass the bill, even amid concerns that there may be unintended consquences that could affect penny arcades for children and seniors. The House gaming committee passed a nearly identical bill on Friday and is expected to pass it on the House floor on Wednesday. 

The Senate committee spent most of the meeting laying the foundation for why the bill is needed this year, when they had planned to wait until next year to clarify the law, when they will attempt a sweeping rewrite of the state's gambling laws. 

Senate gaming committee chairman relies on flights from gaming lobbyist

The chairman of the Senate committee that oversees gambling relies on the planes of the lobbyist of a chain of Internet cafes for travel to Tallahassee and his Naples home.

Sen. Garrett Richter, a Naples Republican and chairman of the Senate Select Committee on Gaming, said that his primary mode of travel is Capital Air, owned by Dave Ramba, who is a licensed pilot, lawyer, fundraiser and prominent lobbyist. In the past two years, House Speaker Will Weatherford, Senate Democratic Leader Chris Smith and others have also flown on what one senator jokingly calls "Air Ramba."

“Yes, I fly on the airplane that I understand is owned by David Ramba.’’ Richter told the Herald/Times on Friday. “I don’t fly alone. It’s my method of transportation. I receive an invoice for Capital Air. I submit that check for my reimbursement… I don’t see anything inappropriate about it.’’

Ramba, according to legislators, is one of a handful of lobbyists who own planes and makes them available for lawmakers.