Mar 9, 2009 10:52 pm US/Eastern
Who Says You Can't Play The Slots In Mass.?
Investigation Finds Hundreds Of Bars Running Mini-Casinos
BOSTON (WBZ) ―
WBZ's I-Team has learned hundreds and hundreds of bars in Massachusetts are running their own mini casinos. We are talking about slot machines, video poker and big cash pay outs. Chief Correspondent Joe Shortsleeve went along with state investigators as they moved to shut down these operations.
RAID TARGETS BARS
It was Thursday morning March 5 when state investigators fanned out across five towns in Worcester County. Their mission: cracking down on bars doubling as illegal mini-casinos. It was just before noon time when about a dozen agents from the State's Alcohol Beverage Control Commission marched into half a dozen bars.
The first stop was the South Gardner Hotel in Gardner. Inside they found at least four video poker machines modified for real gambling. Agents opened up the machines and were able to view just how much cash was put in and how much was paid out.
The stunned bar manager could only watch as agents uncovered a large amount of cash and stacks of receipts recording pay outs.
ILLEGAL GAMBLING MEANS BIG MONEY
Make no mistake; this is a shady lucrative growing underground business.
The lead Investigator for the State is Ted Mahoney.
"This place will be charged with four counts of illegal gambling," he said.
There are 12,000 bars in Massachusetts and state investigators estimate as many as 2,000 have illegal gambling devices.
Ted Mahoney says, "These are substantial dollars we are talking about, millions, millions of dollars."
HOW IT WORKS
The I-Team captured undercover video of the electronic poker machines in use at the South Gardner Hotel on a recent Friday night. There were plenty of gamblers.
The machines themselves when used for simple amusement are not illegal, but many have been specially programmed for real gambling. There could be as many as 10,000 modified devices in Massachusetts.
Mahoney says, "The vending companies will put the machines in the bar. Owners will then split the winnings with the vending company."
On that recent Friday night some of those feeding cash into the machines at a half a dozen different bars were experienced state investigators. And just like Foxwoods or Vegas winners are paid in cold hard cash. And that is where this gaming becomes illegal. At a bar called Mickey Shea's in Lunenburg the I-Team captured the payout on tape.
The I-Team was there when agents confronted the man who identified himself as the owner of Mickey Shea's.
One investigator who wants to remain anonymous said to the owner, "Just so you know one of our investigators was paid in cash at this counter."
The owner had no response.
The manager of the South Gardner Hotel, where investigators were also paid in cash one night, was asked by I-Team reporter Joe Shortsleeve: "Isn't it true once you make a cash payout to the winner that's a crime?"
Paul Johnson, the manger, responded "I don't know. I never really thought about it."
This sting operation followed a four month undercover investigation by agents working for the State Treasurer Tim Cahill.
Shortsleeve asked Cahill, "What is going to happen to these bars?"
Cahill responded, "They will go through a legal process, we will make the case that they violated the law, and if they are found guilty they will be sanctioned. There could be a loss of license, fines and hopefully loss of machines."
This isn't just about a small businessman trying to make some extra cash. It's big money.
Investigators say one bar can make $10,000 a week under the table, and they say the slot machine suppliers could be tied to something bigger.
Shortsleeve asked Cahill, "Is it primarily orchestrated by organized crime?"
Cahill responded, "We don't know that, but it appears to be, and there usually historically has been."
LEGALIZE SLOT MACHINES?
This raid by State agents comes the same week Treasurer Cahill has suggested slot machines should be legalized in this State. Cahill says the problem with illegal gaming is huge. But he reasons if the state regulates it, cities and towns will make millions. And he says the gambler will have a lot better odds while playing in a safe environment.
And this added note:
Last week reputed mob associate Arthur Gianelli went on trial in Federal Court in Boston charged with racketeering and money laundering.
Prosecutors told jurors he made his millions running illegal gambling operations in bars in this state.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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