Monthly Archives: August 2019

Missouri Legislators Finally Discussing Ways to Enforce and Eliminate Illegal Gambling Machines Across the State

Casino Watch Focus has reported on the worrisome issue in Missouri of illegal slot machines popping up across the state in non-licensed locations such as gas stations and the even worse possibility of legislators contemplation making slot machines legal outside of casinos. However, the concern rose over such a massive expansion of gambling has now shifted to enforcement methods to eliminate illegal slot machines. So far it seems to be the responsibility of local prosecutors as the Gaming Commission can only enforce regulated, legal gambling. An online source explains: 

After years of inaction by Missouri lawmakers, the push may be on to take aim at the tens of thousands of illegal slot machines spreading across the state. In the first meeting of a special House committee formed to address gambling laws in the state, the chairman of the panel said he believes Missourians want to unplug the illegal terminals, which have popped up in gas stations, taverns and convenience stores. 

The Missouri Gaming Commission has deemed the terminals as “gambling devices,” which are prohibited outside of Missouri’s 13 licensed casinos. But, there is little agreement on how to control their spread. The Missouri Gaming Commission says it can only police establishments that have bingo licenses. And the Missouri Department of Public Safety, which oversees liquor licenses, says it cannot crack down on the machines because of a court ruling in 2000 that found the agency has no authority to seize gambling devices. For now, it appears most of the work to crack down on the machines is on the backs of the state’s 115 county prosecutors, a process which Rep. Dirk Deaton, R-Noel, called “cumbersome.”

However, it seems that many Missouri legislators believe its time to find a statewide solution to the problem, although many interests are in play. An online source explains: 

David Grothaus, executive director of the gaming commission, urged lawmakers to find a statewide solution. “What the state needs is a very focused effort on these illegal machines,” Grothaus told the panel. Rep. LaKeySha Bosley, D-St. Louis, said she knows of at least five locations within her district where illegal terminals are located. “It blows my mind that they are that blatant,” said Rep. Wes Rogers, D-Kansas City. “These illegal machines are everywhere. I have several of them in my district,” Shaul added. Shaul said some of the blame for the situation lies with the Legislature.

Finding a solution could be a tough sell when lawmakers gather for their annual session in January because of the varied interests involved in the debate.

Casino operators are opposed to legalizing the machines because they could cut into their profits. Casinos also want to begin taking wagers on sporting events, but the terminal operators don’t want to allow that without getting the ability to operate legally.

Among the companies linked to the spread of illegal gambling is Torch Electronics, which is managed by Steve Miltenberger of Wildwood. The company has hired a team of well-connected lobbyists and has pumped at least $20,000 in contributions to a campaign committee raising money for Gov. Mike Parson. Miltenberger, who previously worked for video gambling companies in Illinois, where they have been taxed and regulated since 2012, has placed video terminals in businesses across Missouri over the past year. 

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

A Brief Look at Crime 08/19 – 08/25

Man Stabbed and Killed Wife After Losing Thousands Gambling

This week a court in London a court heard testimony that gambling addict Jalal Uddin allegedly stabbed his wife in the face after rowing about money in January. The 47-year old chef was said to have stabbed Asma Begun, 31, at their family home in East London where she later died. The couple had three children together. During the hearing at the Old Bailey earlier this week, jurors heard that the attack was so extreme that a pathologist struggled to count the cuts on Mrs. Begum’s face. Prosecutor Daniel Robinson QC said, “She was cut, stabbed, slashed, or chopped at with the knife at least 58 times. Such was the ferocity of the attack that pieces of the knife blade broke off in her face.” Uddin, a chef at an Indian restaurant in the city, was known to have a gambling problem. Staff members at his local William Hill betting shop in East London called him the “angry Indian” because he was known to kick the machines after losing. Mrs. Begun had previously reported her husband to police for violence and verbal abuse. She was documented as saying in 2016 that he would hit her when she refused to hand over her housekeeping money for gambling and that he would often beat her if they rowed over money.

Racetrack Bingo operators sentenced (FL)

More than a year after being found guilty of operating an illegal business, fraud and money laundering, Larry and Dixie Masino, former owners of Racetrack Bingo in Fort Walton Beach, have been sentenced for their crimes. U.S. District Court Judge Casey Rodgers sentenced Larry Masino to a year and a day in federal prison followed by two years of supervised probation. Dixie Masino, his ex-wife, was sentenced to four months of house arrest as part of a five-year probated sentence, a news release from the U.S. Attorneys Office said. “With today’s sentencing, the Masinos will pay a high price for defrauding unsuspecting charities whose sole mission was to help others,” U.S. Attorney Larry Keefe said in the release. Larry and Josh Masino, who were listed in 2010 as co-owners of Racetrack Bingo, were arrested that year in Tallahassee on charges they pocketed money intended for nonprofit organizations there. The men were charged with 11 counts of grand theft for their roles in an “organized scheme to defraud,” according to the Leon County Sheriff’s Office. They were also charged with 312 violations of state bingo statutes. The pair ultimately pleaded no contest to two gambling violations and were sentenced to two years probation and 100 hours of community service. They were also ordered to pay more than $87,000 in restitution to 11 Leon County charities and agreed never to operate a bingo parlor in Leon County, according to media reports.

University of Minnesota employee who stole computers to fund gambling habit pleads guilty

A University of Minnesota employee who spent $134,000 of university money buying computers he would then sell for a profit has pleaded guilty to charges of theft by swindle. Michael McDaniel, 34, of Lilydale, accepted a plea deal that will see him get a 27-month prison term stayed for 8 years, along with serving a year in a county workhouse. In exchange, he pleaded guilty to two thefts by swindle from the University of Minnesota, and another theft by swindle incident involving merchandise from a Target store in an earlier case. He will also have to pay restitution totaling $134,000 and receive treatment for a gambling problem, and his required to abstain from gambling during probation. Bank records showed that he spent the proceeds of his theft to pay off debts owed to a dozen of loan companies and multiple credit cards, as well as making “substantial” withdrawals at metro area racetracks and casinos. According to the criminal complaint, McDaniel was working in the Center for Magnetic Resonance Research department and bought computers for his department through university bookstores, but didn’t register them with the university’s IT department, as is procedure.

Bainbridge authorities arrest suspect connected in fatal overnight shooting

A Bainbridge man wanted for a deadly Monday morning shooting was arrested by Donalsonville Police around 4:30 p.m. Bainbridge Public Safety says 48-year-old Jamel Jackson is being charged for the murder of 34-year-old Leon Chandler. Investigators believe what started as a card game, involving drugs and gambling, turned into a deadly shooting overnight. In the early hours of the morning, public safety officers responded to a gunshot victim at the ER. Investigators say Chandler was taken there by private vehicle, but he died on the way from a gunshot to the head. “It was a little chaotic. We had family members there that were upset. Then at the hospital, once they pronounced him dead it became worse with a lot of mourning,” said Chip Nix, the responding investigator. Nix says eyewitnesses watched Jackson pull the trigger, during a small gathering at his house at 707 Dennard Street. In the middle of the game, they say Jackson accused Chandler of stealing money and shot him.

Woodlands double deaths: Man strangled pregnant wife, 4-year-old daughter due to gambling debts

Saddled with crippling gambling debts, he could not pay his four-year-old daughter’s kindergarten fees. After arguing with his pregnant wife over the fees on Jan 20, 2017, Teo Ghim Heng was so overwhelmed with anger that he looped a towel around her neck, strangled her with it for 15 minutes, and then finished the job with his bare hands. He then turned his attention to his child and killed her the same way. The grisly details of the double murders were admitted in the High Court on Tuesday (July 2) at the start of Teo’s trial. Before their bodies were discovered in their Woodlands flat a week later, Teo repeatedly lied to family members to explain their absence at Chinese New Year reunion dinners and visits, and made himself scarce when his colleagues and family tried to visit the flat. He also claimed to have tried to take his own life by setting fire to the bodies and lying next to them on the bed in the master bedroom, but then later felt the fire was too hot and left the flat.

Memphis man arrested by U.S. Marshals after toddler shot in the head while man gambled

A murder suspect has been arrested after a toddler was killed in Hickory Hill. Shelby County deputies issued warrants for Jermichael Davis for First Degree Murder and Aggravated Child Abuse. U.S. Marshals developed Davis as a fugitive in the case that involved 2-year-old Anaya Boyd. The little girl was shot in the head at her home back in November 2018. Investigators tracked Davis to the 1150 block of Rutland. He was arrested and taken into SCSO custody. The child’s father, Mikal Grogan, was also charged in the case. Grogan was charged with aggravated child neglect and endangerment. According to police, Grogan admitted to selling marijuana out of his apartment and was playing dice and gambling the night of the deadly shooting. Grogan told police that he heard someone knocking at his door. When he asked who it was, they started firing shots. Witnesses said they heard more than a dozen shots fired at the Enclave apartment homes off Hickory Hill that morning.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

UPDATE: DOJ to Files Intent to Appeal Wire Act Court Ruling

Casino Watch Focus has reported on the ongoing battle to properly regulate online gambling through the Wire Act. The Wire Act’s long standing language and interpretation limited online gambling, yet the Obama Administration claimed it only applied to sports betting, thus freeing the way for all other forms of online gambling. The current Administration reversed that puzzling interpretation and declared the Wire Act applied beyond sports betting. Recently, a US District Court upheld the Obama Administration interpretation, and the DOJ asked Attorney’s General to hold off enforcement until the issue could be properly vetted. An online source reports: 

The DOJ in 2011 had stated that the Wire Act applied only to sports wagering. But it *reversed course with a memo from 2018 expanding the possible reach for federal prosecution, which triggered worries about its applicability to online gambling, lotteries, and other forms of gaming that potentially cross state lines.

The New Hampshire District judge had forecast that the case would likely reach the*US Supreme Court*. While the case is going on, the DOJ has said it would not enforce the new interpretation of the Wire Act until 2020.

The *Department of Justice* filed its intent to appeal a district court decision on the Wire Act to the First Circuit Court of Appeals. In June, a federal judge in the New Hampshire District ruled that the Wire Act applies only to sports betting, and not to other forms of interstate gaming.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


A Brief Look at Crime 08/12 – 08/18

2nd-degree murder conviction in Tahoe casino killing

A Douglas County jury has convicted a 45-year-old man of second-degree murder in the killing of another man at a Lake Tahoe hotel-casino that he claimed was self-defense. The Record-Courier reports the jury deliberated for six hours before returning the guilty verdict for Jose Rodriguez-Quezada at about 11:30 p.m. Friday. The jury determined he did not act with premeditation, which is required for first-degree murder. It found him guilty instead of second-degree murder with the use of a deadly weapon in the October 2017 stabbing of Kevin Edwards at the Hard Rock Hotel in Stateline. Prosecutors said Edwards had been stabbed or slashed 30 times. They said Rodriguez-Quezada is in the country illegally and faces deportation once he completes a prison sentence that could range from 25 years to life in prison.

Woman’s Body Found Inside Car In Horseshoe Casino Parking Garage 

The Baltimore Police Department is investigating a “suspicious death” after a woman’s body was found in a parking garage of the Horseshoe Casino, police confirm with WBAL NewsRadio 1090 and FM 101.5. Around 6 p.m. on Sunday, police received reports of a suspicious death. Once on the scene, police found an adult woman dead inside a car in a parking garage of the casino. Police say the cause of death will be determined after an autopsy is performed. At this time, there are no further details.

Feds: Texas family ran $33M illegal sports gambling outfit 

Members of a southeast Texas family acknowledged in federal court Tuesday that they ran illegal bookmaking from the father’s used car dealership for more than three decades, an enterprise federal authorities described as one of the nation’s biggest illegal sports gambling and money laundering operations. Larry Earnest Tillery, his wife Judy Kay Tillery and their son Brian Tillery pleaded guilty in federal court in Beaumont, Texas, to charges arising from their illicit sports betting operation. Larry Tillery, 69, and Brian Tilery, 46, pleaded guilty to making monetary transactions in property derived from unlawful activity and tax evasion. Judy Tillery, 62, pleaded guilty to structuring financial transactions to evade tax reporting requirements Federal prosecutors say the Beaumont family’s operation handled almost $33 million from 2010 through 2016, with Judy Tillery helping her husband launder the cash proceeds of the activity and Brian Tillery helping to collect from and pay the bettors. “For more than 30 years, this family operated one of the largest illegal sports gambling and money laundering operations in the U.S.” said Mary Magness, assistant special agent in charge of the Homeland Security Investigations Houston office in a statement.

Mom leaves child at McDonald’s to go to the casino 

A woman was arrested late Wednesday night after Peoria police discovered she left her 9-year-old child unsupervised at a McDonald’s to go gamble at the Desert Diamond Casino, according to court documents. According to Peoria police, they received a call from an employee at a McDonald’s near 91st and Olive avenues regarding a welfare check for a child who had been left unsupervised for more than an hour at the fast food chain. The employee allegedly told police the child looked “dirty and was disheveled.” The 9-year-old told police that his mother, identified in court documents as Stacy Rupp, 34, was “going to the casino and to a friend’s house.” Rupp returned to the McDonald’s around the same time police arrived and told officers she had been shopping at a Fry’s Marketplace located in the same shopping complex. Rupp initially denied going to the casino when questioned by police, but later admitted she did go to the Desert Diamond Casino. Surveillance footage from the casino allegedly showed Rupp walking into the facility around 8:30 p.m. and leaving around 10:30 p.m. Rupp is being charged with one count of child abuse and one count of endangering the life/health of a minor.

Sparks fly as Houston officers find stacks of cash in raid of illegal gambling room

Luck ran out for an illegal gambling room in South Houston on Tuesday. The Harris County Precinct 1 Constable’s Office in Texas raided an illegal gambling room that they say brings in $60,000 to $100,000 a day, KTRK reported. Officials say stacks of cash were seized along with more than 200 gaming machines, the Houston Chronicle reported. A video posted to Constable Alan Rosen’s Twitter page shows sparks flying as officers saw locks from a long row of gambling machines. Photos posted to the account show cash strapped with rubber bands stacked in what appears to be a safe. “This is a game room that steals from people on fixed incomes. There’s crime that happens in and around these places,” Rosen said, according to KTRK. “We’ve had people use Lone Star cards that they’ve traded off to gamble.”

Pa. accountant charged with stealing nearly $1.4 million from nonprofit organization, using it to gamble 

An accountant, who scammed his client out of $1.4 million and used it to gamble at Mohegan Sun Pocono casino, was sentenced to seven years of imprisonment and three years of supervised release, according to the United States Attorney’s Office for the Middle District of Pennsylvania. Adam Kamor, 44, was accused of shifting a nonprofit’s money through a series of accounts between October 2014 to January 2018, which were under his control, embezzling over a million dollars he personally benefited from, the Middle District reported. He also failed to report three years of income totaling $804,365.73, officials said. “Not only did this defendant willfully fail in his duty as a citizen to pay his fair share, he further enriched himself by stealing from an organization that existed for the benefit of others,” U.S. Attorney David Freed said in a statement. United States District Court Judge James Munley ordered Kamor to pay $1.35 million in restitution to his victim, and $241,623 to the Internal Revenue Service, according to the Middle District.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

Florida Greyhound Ban Amendment Lawsuit filed to Obtain Damages, but does the Lawsuit have Merit?

Casino Watch Focus has reported on the various development of Florida Amendment 13, which bans greyhound racing in the state. Voters overwhelmingly voted in favor of the ban, despite some potential issues with decoupling the gambling from the tracks, an issue known as decoupling. Voters also passed Amendment 3 though, a provision that prevents the legislature from authorizing new forms of gambling without state-wide voter approval. Several tracks have already stopped the live races, but still offer the gambling options they provided prior to the closure. For now, actually expansion of gambling through decoupling hasn’t been addressed, though it seems fairly clear that any expansion of the gambling that was previously allowed, should most certainly require voter approval. Regardless, the Amendment didn’t actually prevent all the gambling at the tracks that many who supported the proposal had hopped or assumed, as the decoupling issue was complicated and most simply wanted to see the live races stop. There is still a lot of gambling and a lot of money being made at various tracks. However, at least one track believes that Amendment 13 took away the value of their facility, and thus they are entitled to compensation. Recently, it was announced that a lawsuit could be filed in an effort to overturn Amendment 13. A lawsuit has now been filed, but this one only seeking compensation. The Orlando Sentinel reports: 

Christopher D’Arcy, owner of D’Arcy Kennel LLC in St. Petersburg, wants a judge to order the state to pay damages for the loss of value of his property, including racing dogs that the lawsuit said could previously be sold for up to $50,000.

Voters in November approved a constitutional amendment, known as Amendment 13, that will shut down Florida’s decades-old greyhound racing industry by a Dec. 31, 2020, deadline.

The lawsuit was announced Monday by the Florida Greyhound Association, an industry group that fought the constitutional amendment, which came after years of calls by animal-rights groups to ban dog racing in the state. The measure easily passed, with support of 69 percent of the voters.

The Florida Greyhound Association went to court last year in an unsuccessful attempt to keep the constitutional amendment off the ballot. The new lawsuit does not try to overturn the amendment but seeks damages under the Florida Constitution and the U.S. Constitution. It makes a claim for what is known as “inverse condemnation” and contends that the amendment was a “taking” of property without compensation.

The main question is whether or not this claim has merit. Clearly these tracks can still offer gambling, which in and of itself provides value to the owners. The Orlando Sentinel continues:

Christine Dorchak, president and general counsel of GREY2K USA, disputed the arguments raised in the D’Arcy lawsuit and said the kennel owner is not owed compensation. “No property is taken under Amendment 13, and this humane law simply phases out an industry that is cruel and inhumane,” Dorchak said in a emailed statement. “Unlike the pig farmer who could no longer use his gestation crates at all, the track land and the dogs themselves retain value.” While greyhound tracks face a Dec. 31, 2020, deadline for ending racing, they were able to stop racing at the beginning of this year. In the past, tracks had been required to run races to offer more-lucrative types of gambling, such as card rooms.

However, the issue of whether or not property has actually lost value can be addressed outside of the decoupling purview, and there are those that don’t think the case has any legitimate legs to stand on given the gambling nature of dog racing in general. Florida Politics online reports: 

One of the lead backers of last year’s successful state constitutional amendment to ban greyhound racing has told legislative leaders that a lawsuit against the measure is “dubious” and “frivolous.”

Carey Theil, executive director of GREY2K USA Worldwide, which aims to permanently end dog racing, sent a letter Monday to state Rep. *David Santiago*, chair of the House Gaming Control Subcommittee, and state Sen. *Wilton Simpson*, who chairs the Senate Committee on Innovation, Industry and Technology, which oversees gambling issues. “We believe this lawsuit is without merit and will be rejected,” Theil wrote. “As you know, no property is taken under Amendment 13, and (it) simply phases out an activity that voters have found to be cruel and inhumane.”

A similar claim was brought in Massachusetts in 20111, he added, resulting in a ruling against a kennel owner. A judge found that the owner “could have no reasonable investment-backed expectations in its greyhound kennel business” because “it operates in the highly-regulated gaming industry.” “Rather than to obstruct adoption efforts and file frivolous lawsuits, the industry would be better served working to ensure there is a successful transition for every track worker and every greyhound,” Theil told the lawmakers.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


A Brief Look at Crime 8/05 – 08/11

Mobster’s son is indicted for ‘ordering fatal hit on his own father at a McDonald’s drive-thru attempting to take over illegal gambling business

A mobster’s son allegedly ordered a hit on his father at a McDonald’s drive-thru in the Bronx as well as a botched hit on his own brother, authorities say. Anthony Zottola Sr has been charged with murder-for-hire conspiracy, causing death through the use of a firearm and unlawful use and possession of firearms, according to an indictment filed in Brooklyn federal court and released Tuesday. ‘As alleged, Zottola Sr set in motion a deadly plot to kill his father and brother, with Bloods gang members carrying out extreme acts of violence to collect a payoff for the hits,’ US Attorney Richard Donoghue said. He allegedly paid gangster Bushawn ‘Shelz’ Shelton to shoot dead his father, Sylvester ‘Sally Daz’ Zottola on October 4 outside the McDonald’s after his Acura SUV was boxed in by other vehicles. A reputed associate of the Bonanno crime family, the elder Zottola was suspected of running an illegal gambling operation.

Dozens Of Jacksonville Gaming Parlors Targeted As Part Of Crackdown (FL)

Twenty-three gaming parlors were ordered shut down Monday following a City Council ruling to ban casino-style games at internet cafes around the city, according to city officials. WJCT News partner /The Florida Times-Union/ reports that the City said they constitute “a public nuisance.” The action targeted the first of a list of businesses well known for bright LED lighting around signs advertising “FUN” in strip malls from Arlington to the Westside. The City Council approved the bill May 28, and the city’s demand to cease operations focuses on any business that does not have a valid certificate of use issued by the city. About 110 businesses hold those certificates authorizing them to operate and can keep their gaming devices until Feb. 1, city attorney Jason Teal told the City Council before the bill’s passage. “Many more simulated gambling establishments have opened illegally,” among the first targeted with the Monday deadline, the city said.

League of Legends Hit by Gambling and Match-Fixing Scandal

The popular eSports game League of Legends has been recently embroiled in a scandal regarding gambling and match-fixing. LGD Gaming’s Xiang “Condi” Ren-Jie and manager Song “Hesitate” Zi-Yang have been found to be involved in League of Legends match-fixing and gambling. Condi was suspended for 18 months from competitive League of Legends gameplay. Zi-Yang has been given a lifetime ban. The incident of gambling and match-fixing involving League of Legends comes at a time when eSports is expected to skyrocket in growth. According to VSO News, experts believe that online gambling on eSports will surpass the $13bn mark by 2020. Sports stadiums play host to eSports events and viewership has grown over the past few years. Young people now spend more time than ever watching videogame streamers and content creators. Esports had 335 million viewers in 2017 and that number is expected to increase to around 557 million by 2021. Currently, the two main formats for watching streamed video gaming footage are Twitch and YouTube. Each site continues to see growth as the industry becomes more popular. As the industry becomes more popular, those involved will have to keep an eye out for incidents of match-fixing and illegal gambling.

Businessman accused of writing $330,000 bad check at casino

Beaumont businessman Larry Tillery Sr. is accused of writing a bad check for $330,000 to a Lake Charles casino. He was arrested and taken to jail on Tuesday, June 18, 2019. However, Louisiana authorities have asked their Texas counterparts to release Tillery from jail, where he spent a night. KFDM/Fox 4’s Angel San Juan reports that the district attorney’s office in Calcasieu Parish doesn’t want to extradite Tillery, so the D.A. office in Calcasieu Parish asked Texas authorities to release Tillery. The Tyler County sheriff had been holding. Tillery without bond in the jail in Woodville since Tuesday afternoon on the Louisiana charge.Tillery was released from jail on Wednesday. Although Tillery is out of jail, the charge against him remains active, along with a federal investigation accusing him of illegal gambling.

NJ Online Sportsbook DraftKings fined for allowing cool-off players to continue to gamble 

According to the DGE, the DraftKings online sportsbook noticed last November that its platform was allowing some gamblers who had requested “cool-off status” to continue to wager. The DGE said that the tech fail happened thanks to a software upgrade the previous month. A total of 54 gamblers were in cool-off status at the time of the software malfunction, according to the Garden State. DraftKings corrected the issue on Nov. 16, informing the DGE of what happened. Between Oct. 24 and Nov. 16, 13 of those gamblers deposited money and placed a combined $28.8k in wagers. DraftKings won a combined $3.2k from that handle from 11 of those players. For those unfamiliar with this feature, NJ actually requires online gambling operators to offer a way for patrons to take a break. It’s a feature you won’t find in a brick-and-mortar casino. “Internet and mobile gaming systems shall employ a mechanism that places an internet or mobile gaming account in a suspended mode,” says a provision in NJ’s online gambling regulations.. Online sportsbooks must provide a minimum of 72 hours of suspended play when a patron seeks cool-off status. That 72-hour minimum, while possibly dissuading some gamblers from requesting cool-off status, does boost the odds that a gambler losing control can receive enough time to clear their head.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

FTC and Researches Discuss how Loot Boxes can be a Life or Death Situation with Problem Gamblers

Casino Watch Focus has reported on the ongoing concerns from a form of gambling promoted in video games known as loot boxes. Recent debate has focused on whether or not this video game mechanic technically meets the definition of gambling. Some jurisdictions have out right banned them as they meet their definition of gambling completely, and others have ordered more study and review as they may not technical meet their definition of gambling, but they certainly employ the same psychological tricks to suck in young gamers to spend hundreds of dollars. Recently the FTC added state and federal legislators in their concerns over loot boxes and gambling issues, specifically how it they could be a gateway to problem gambling. Forbes reports:

Video games can be a gateway to problem gambling, the Federal Trade Commission was warned Wednesday. The danger comes from a feature that has become embedded in a majority of the most popular video games in recent years: loot boxes, according to experts who spoke in an all-day seminar held by the agency.

A loot box is a virtual box a player can buy in a game with real or pretend money with the potential for getting virtual weapons and other aids to help the chances of winning the game or the ability to customize characters. The payments are made through “microtransactions.” The name can hide the true financial hit on a child or other video game player because while a single loot box can cost 99 cents, repeated purchases or buying a bundles or bundles can go into thousands of dollars over time. For some players the lure of loot boxes is a pathway to problem gambling with young men and boys particularly at risk, cautioned National Association On Problem Gambling Executive Director Keith Whyte. 

Some, especially those video game publishers like EA, who make a significant amount of their profits from gambling-esque loot boxes, tend to trivialize any link to gambling and claim their methods are completely ethical. Most disagree and experts at the panel claim the link shouldn’t be trivialized and the issues are far more serious that people might think. A major online video gaming source, PC Gamer explains what researches claim:

Speaking at a panel during the FTC’s recent workshop on videogame loot boxes, York St. John University research Dr. David Zendle stated unequivocally that loot boxes are connected to problem gambling. As reported by GamesIndustry, Zendle acknowledged that the causal relationship between the two isn’t clear, but said that the connection “is a clear cause for concern” that should not be trivialized.

“Spending money on loot boxes is linked to problem gambling. The more money people spend on loot boxes, the more severe their problem gambling is. This isn’t just my research. This is an effect that has been replicated numerous times across the world by multiple independent labs,” Zendle said. “This is something the games industry does not engage with.”

“This is so important. It’s not something we should trivialize or laugh at or compare to baseball cards. This is life or death.”

Another common deflection is that its not loot boxes that cause problem gambling, its problem gamblers over spending on loot boxes. The researchers address this issue in a very pragmatic way, essentially concluding that it’s completely irrelevant. PC Gamer continues:

The question of whether loot boxes are a gateway into other forms of problem gambling, or if people who have gambling problems to start with are naturally drawn to loot boxes, remains unanswered, and it could work both ways. But in Zendle’s opinion, it doesn’t really matter in any practical sense.

“In either case, it’s a clear cause for concern and not something to be trivialized. In one case, you have a mechanism in games that many children play that is literally causing a state of affairs that is enormously destructive. And if loot boxes do cause problem gambling, we’re looking at an epidemic of problem gambling the scale of which the world has never seen,” he said.

“And if that’s not true—and I’m totally open to that not being true—then you’ve got a system in which game companies are differentially profiting from the most vulnerable of their consumers. Problem gamblers already have enormous issues in their lives. They don’t need to have their money taken away from them through this as well.”

Zendle has authored multiple reports on loot boxes and gambling, and is unambiguous in his findings. In [his] 2018 article “Video game loot boxes are linked to problem gambling: Results of a large-scale survey,” for instance, he concluded, “This research provides empirical evidence of a relationship between loot box use and problem gambling. The relationship seen here was neither small, nor trivial. It was stronger than previously observed relationships between problem gambling and factors like alcohol abuse, drug use, and depression.”

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

A Brief Look at Crime 7/22 – 8/04

Sands Casino fined $242,500 for two violations

Sands Casino has been fined for two different violations by the Pennsylvania Gaming Control Board. According to the Pennsylvania Gaming Control Board press release, the fines totaled to $242,500. The first fine was for 11 incidents, in which “individuals under the age of 21 accessed the gaming floor,” and some of them were served alcohol. The second was for “permitting the issuance of free slot play by employees who were not authorized to do so and/or issuing slot play of amounts above authorized levels.” However, these fines are not a rare occurrence for casinos, said Richard McGarvey, the spokesperson for Pennsylvania Gaming Control Board.

Woman stole $131,000 from medical practice to feed gambling habit

A Claysburg woman faces felony charges after state police allege she embezzled about $131,000 from a Logan Township medical practice. According to charges filed by state police, Bushore started working at the business as a billing supervisor in 2012 and was in charge of depositing cash into Advanced Regional’s bank account. She quit in May 2017. The investigation found that between May 2014 until May 2017, a total of about $131,000 in cash was not deposited into Advanced Regional’s bank account. Her credit report allegedly shows she has about $78,000 in past due debt and a total balance of about $277,000. Also, Bushore spent “what was perceived to be substantial amounts of money on numerous recreational activities, including gambling,” the investigator wrote in the charges. After obtaining a court order, state police received records about Bushore from Rocky Gap Casino in Flintstone, Md., from August 2013 until the present. State police said that Bushore’s “coin in” totals at the casino came to $119,641.21.

Former Goldman Sachs banker sentenced to 3 months’ prison for insider trading

A former Goldman Sachs Group Inc banker was sentenced to three months in prison for using a secret account to reap thousands of dollars in illegal profits by trading on inside information about company clients. “Jung used material nonpublic information stolen from his investment bank employer to net nearly US$130,000 (RM540,800) in illegal gains,” US attorney Geoffrey Berman said in a statement in Manhattan. Prosecutors had recommended that Jung serve 18 to 24 months behind bars, citing federal sentencing guidelines. Jung had asked the judge to spare him prison, saying in a letter that he made the trades to help his brother, who had a gambling problem. “While it seemed like I was helping my family in the short term, my poor judgment has led to larger, unfathomable problems and irrevocable damage,” Jung wrote to US District Judge Lewis Kaplan. “I take full responsibility for my wrongdoing and I am deeply regretful.”

Gamesys Ordered to Return Over $584,000 0 in Stolen Money Gambled Online by Criminals

Software provider and operator Gamesys has been ordered to repay £460,472 ($584,000) to victims of thieves who played on its gambling platforms with stolen money. The UK gambling regulator (UKGC) has also ordered the company to forfeit £690,000 ($875,000) for violating money laundering regulations and “failing to prevent gambling harm,” bringing the total penalty to just under £1.2 million ($1.52 million). The regulator said in a statement Wednesday that it launched a review of the company’s procedures following police investigations that uncovered three instances where criminals unnamed by the regulator had deposited some of the proceeds of their crimes into Gamesys platforms. The London-based company operates the popular Jackpot Joy and Virgin Games brands, among others. It concluded that a “variety of failures” that lasted for a sustained period of time saw “stolen money flowing through the business.”

Peoria Tribe issues $2 million fine against casino managers

The Peoria Tribe is seeking more than $2 million from the former managers of its casino in Oklahoma after being hit with a federal enforcement action. On May 10, the National Indian Gaming Commission issued a notice of violation to the tribe. It laid out 77 infractions, accusing the tribe of misusing gaming funds and operating the Buffalo Run Casino and Resort without an approved management agreement. The tribe is appealing the notice but blames the former managers for the violations. The tribal gaming commission has since issued fines of $2,067,561 against David J. Qualls and Tony D. Holden in hopes of addressing the enforcement action. “The Peoria Tribe takes these issues seriously and we will cooperate fully with the NIGC and other federal authorities to resolve its concerns related to these events,” Chief Craig Harper said on Thursday. “We hope to avoid or limit penalties we may be assessed for the wrongful conduct of those two men.” The tribal gaming commission has since revoked the licenses of Qualls and Holden

Man pleads guilty to decapitating Montana casino patron

One of two men charged with decapitating a casino patron has pleaded guilty. The Billings Gazette reports that 34-year-old Jeffery Glen Haverty pleaded guilty Monday. Haverty and 32-year-old Donald Ray Cherry were both charged with deliberate homicide in the October 2017 death of 41-year-old Myron Wesley Knight. Prosecutors and Haverty’s attorneys say they will seek 50 years in prison under a plea agreement. Authorities say Knight asked a Billings casino employee to hold $120 in winnings before leaving with the men. Police say Haverty robbed Knight of his remaining $6 and began decapitating him in a transient camp. Authorities say Cherry took part in the decapitation after returning from a gas station. Knight’s body was found three weeks later.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION