Arkansas casino group releases list of stockholders

David A. Lieb

Thursday, Oct. 19, 2000 | 4:29 a.m.

LITTLE ROCK - With two of its organizers facing security fraud charges, a casino gambling group has released a list of its stockholders in an attempt to show its backing for a proposed constitutional amendment.

The documents made public Thursday include the names and hometowns of 322 stockholders in Natural States Resorts Inc., more than half of whom are from Arkansas.

"We are a good decent company with the best of intentions," said Bobby May, president of Arkansas Casino Corp., a wholly owned subsidiary of Natural States Resorts. "We're not shady, sleazy characters. We're good Arkansans."

The group is sponsoring a ballot proposal to authorize casino gambling in six counties, a state lottery and charitable bingo. If passed Nov. 7, Arkansas Casino Corp. would get to own all the casinos. Part of the gambling revenues would finance college tuition for Arkansas high school graduates and offset the repeal of the state sales tax on groceries.

Prosecutor Larry Jegley filed charges Wednesday against casino backers Robert Buchholz and James Harris, both of Dallas, accusing them of selling stocks without a license, selling unregistered stocks and providing false information about their company to make it appear viable.

Together, Buchholz and Harris own about half of the company's stock, May said Thursday, although Harris' is listed on ATAP Financial Corp.

Arrest warrants were issued Thursday for the men. Buchholz attorney Sam Perroni said they would surrender Friday at Little Rock Municipal Court.

"Unless they come to their senses and dismiss the charges ... I don't see how in the world this can possibly be resolved before Nov. 7," Perroni said. "The timing of these charges, in my opinion, doesn't pass the smell test."

May also called the charges as politically motivated.

"I think this is a desperate attempt to discredit the company - to try to get the people of this state to distrust us," May said at a news conference.

Jegley on Wednesday had referred to the casino backers as "a bunch of skunks" and the amendment as a scam. May called Jegley "unprofessional," "immature" and "unethical."

The decision to publicize the company's stockholders was somewhat unusual.

Stockholder Teresa Lovelady of Hoxie said she didn't mind the publicity, but added she believes there is a strong possibility that she could lose her investment if the proposed amendment is defeated at the ballot box.

She said the stock purchase "was just a spur of the moment thing" upon the recommendation of a friend. Still, Lovelady said she did not feel misled about the company.

The investor list included 53 people from Utah and another 19 from Idaho. A predecessor company to the casino operation was incorporated as North Star Inc., a mining company, in Idaho in 1899.

Jegley's charges relied on a criminal referral by state Securities Commissioner Mac Dodson, who had cited the gambling group twice and sued it once for securities violations. The casino group also has sued the state securities department.

About 25 pastors and religious leaders opposed the gambling amendment held a news conference Thursday on the state Capitol steps.

The criminal charges "shine a glaring light" on the flaws of proposed Amendment 5 - primarily that the state would not have any regulatory authority over the casinos other than an audit, said Larry Page, director of the Arkansas Faith and Ethics Council.

The pastors criticized gambling as immoral, destructive to families and harmful to communities.

"It is a reverse Robin Hood - it takes from the poor and gives to the rich, and that's why I oppose it adamantly," said Pastor Robert Lewis of Fellowship Bible Church in Little Rock.

At their news conference, casino supporters said their polling showed that 50 percent of Arkansans favored the gambling amendment while 46 percent opposed it and 4 percent were undecided. The polling was done Sept. 11-15 among 600 likely voters and had a margin of error of plus or minus 4 percentage points.

Another poll conducted by Mason-Dixon Polling & Research showed that 51 percent opposed Amendment 5, 37 percent supported it and 12 percent were undecided. That poll of 627 registered voters was conducted Sept. 26-28 for the Arkansas Democrat-Gazette and The Morning News of Northwest Arkansas. It also had a margin of error of plus or minus 4 percent.