The Video Poker Industry & Corruption
Statement from Bob Hall on Video Poker Sweepstakes
June 18, 2010
The scourge of video poker has returned to North Carolina through a loophole that legalizes games of chance tied to commercial products, like the scratch off card you’d get at McDonalds. The state Senate is trying to close the loophole, but it’s not clear the House will go along. Video sweepstakes parlors are popping up by the hundreds across the state. Customers get a “free” chance to play a video sweepstake game when they buy Internet access time or a phone card. Cash payouts to players are now legal instead of under the table, but everything else is the same as the old system:
- Sheriffs complain of criminal side effects and the gaming addiction is ruining families, but video operators are raking in millions of dollars and using their profits to buy protection for the games. They’re hiring a load of lobbyists to prowl the General Assembly, donating to their favorite legislators, and making the same arguments that a ban will cost thousands of jobs, but legalizing and taxing the games would yield mega-millions for the state budget. Do they think votes are for sale?
- Many of the same operators who were in the middle of the swirl of corruption scandals that ultimately sent former House Speaker Jim Black to prison are behind the reincarnation of video poker. They include William Thevaos of Charlotte, president of the Entertainment Group of NC and former second vice president of the now defunct NC Amusement Machine Association; Fred Ayers Jr. of Greensboro, former first vice president of the Amusement Machine Association; and game distributors such as Richard Frye of Southern Pines, Charles Johnson of Bisco, Todd Sutton of Wilmington, Frank Foushee of Sanford, Phillip Totten of Durham, and James Matthews of Jamestown – who all made previous donations to Jim Black and the Amusement Machine Association’s PAC and who are all back, donating in this election cycle to legislative champions of video poker, like Rep. Earl Jones of Greensboro.
- It’s hard to imagine that the state House would block the Senate’s effort to ban the new breed of video gambling – because that’s exactly the ugly pattern that recurred over and over under House Speaker Jim Black’s leadership. The industry pumped more than $200,000 into Black’s campaigns from 2000-2004 (including donations that exposed his corruption), and it supplied much of the money Black used to buy Republican Michael Decker’s vote for his Speakership in 2003. And then there was that mysterious $500,000 “loan” to Jim Black from lobbyist Don Beason, who represented video poker among other interests.
- Lobbyists now working the General Assembly on behalf of video gaming include separate teams from the law firm of former Attorney General Rufus Edmisten, the Williams Mullen law firm and the McGuire Woods law firm, which gained notoriety as the home of former Gov. Mike Easley and his aide Ruffin Poole before they resigned. International Game Technology (IGT) of Reno, Nevada also has two veteran lobbyists working the legislature. A number of these lobbyists worked for the old Amusement Machine Association or various video operators during the last round of battle. Without the lure of money, would their arguments hold water? Has the corruption that oozes through this industry magically disappeared?
Bob Hall, Executive Director
Democracy North Carolina
Direct line: 919-489-1931