Gaming news briefs for September 29, 2005

Thursday, Sept. 29, 2005 | 10:04 a.m.

Company plans to file SEC forms in early November

A Las Vegas gaming equipment manufacturer that has missed several deadlines for filing financial statements for the 2005 fiscal year now says it will provide forms to the Securities and Exchange Commission around Nov. 3.

Alliance Gaming Corp. missed an extended deadline Wednesday after initially scheduling announcements in August and earlier in September. The company has failed to deliver reports after scheduling conference calls four times.

Company executives said Alliance's failure to provide audited financial statements to its lenders could force the company to pay an additional 2 percentage points on its loans. The company has said in previous announcements that the delay in reporting could result in an impact of 30 to 50 cents a share on earnings for the fiscal year.

Request for new trial in Lincoln Park case denied

PROVIDENCE, R.I. -- Lincoln Park race track and two former executives who were convicted last month of conspiring to bribe a Rhode Island lawmaker with up to $4 million are not entitled to a new trial, a federal judge ruled.

U.S. District Judge Mary Lisi said comments made by a federal prosecutor during his closing argument rebuttal, though "inappropriate," did not affect the outcome of the trial.

Defense lawyers said the prosecutor improperly referred to evidence that was not included in the trial. Assistant U.S. Attorney Craig Moore told jurors to "blame" him if something was missing from the government's case and implied there was additional evidence they did not get to hear.

In a written opinion Tuesday denying a defense motion for a new trial, Lisi said the remarks did not unfairly prejudice the jurors and noted that she had instructed the jury to ignore the comments completely.

"These individual comments are unlikely to have registered a substantial impact on the jury, given that they comprise but a fraction of what the jury heard during a two-week long trial and more than a total of six hours of closing arguments," Lisi wrote.

Nigel Potter, the former CEO of Wembley PLC, the British corporation that owned the park until recently; Daniel Bucci, the former general manager of the dog track; and Lincoln Park itself were convicted last month of conspiracy and several counts of wire fraud. They were each acquitted of several other wire fraud charges.

Bucci's lawyer, Anthony Traini, said Wednesday he thought Lisi "misapplied the law" and ruled erroneously on the defense motions. He said he planned an appeal after his client was sentenced.

Lawyers for Potter and Lincoln Park did not immediately return calls for comment Wednesday morning.

Lisi also denied a separate defense motion for a judgment of acquittal, saying prosecutors presented enough evidence that Potter and Bucci conspired together in a bribery scheme.

"We're gratified that Judge Lisi recognized both the soundness of the government's position in opposition to the motions and also the strength of the evidence that supported the conviction," said Tom Connell, a spokesman for the U.S. attorney's office in Rhode Island.

The three defendants were found guilty of conspiring to bribe former Rhode Island House Speaker John Harwood in an effort to win support for more video lottery terminals at the dog track and to block a rival casino proposed by the Narragansett Indian Tribe.

Defense lawyers said the money was intended as a performance bonus for Dan McKinnon, Harwood's law partner who did legal work for the park.

The money was never paid, and Harwood and McKinnon were not charged.

The defense also said Moore misstated evidence by saying Potter did not tell anyone the amount of the proposed payment to McKinnon and Harwood's law firm or that the money was tied to the park's ability to win approval for the extra gambling machines.

Lisi described the statement as "inaccurate" but said it did not require a new trial.

Both Potter and Bucci face lengthy prison terms at their Oct. 28 sentencing. The park also faces a maximum fine of _$1.5 million.

The defendants were convicted in their second trial, which was relocated to Worcester, Mass., because of publicity surrounding the case. Their first trial ended in February when a Providence jury deadlocked on several charges, including the most serious conspiracy count, and found the defendants innocent of other wire fraud charges.

All bets off on casino, slot machine legislation

BOSTON -- The push to bring thousands of slot machines to the state's horse and dog tracks seems headed for defeat, the chairman of a key House committee said Wednesday.

Owners and workers at the tracks say the extra slot machine revenue is crucial to save the struggling industry, and could bring in an extra $500 million in tax dollars.

But critics, including Rep. Daniel Bosley, D-North Adams, say slot machines and casinos are fiscally dubious and socially costly.

Bosley, chairman of the House Economic Development Committee, is charged with reviewing the slot machine and casino bills. He said he didn't think any of the bills would win the backing of the committee.

"I have never had anyone come off the street, just John Q. Public, who has come to my hearing and said 'I don't really have a horse in this race, but I want casinos in Massachusetts,' " Bosley said. "I don't think the House is going to vote for it."

Gov. Mitt Romney said he is also opposed to slot machines and casinos.

Despite the opposition, gambling supporters packed a Statehouse hearing room to plead for slot machines, casinos and an extension of the state's simulcasting law which allows race tracks to broadcast races from other tracks.

Jim Hardy has owned and trained race horses for 25 years, but the North Attleborough resident, who races his horses at the Plainridge Racecourse in Plainville, said he's worried about the future of the industry.

Hardy said the racing profits have dropped even as the cost to feed and care for a horse has steadily increased.

"A lot of people have gotten out of the business," he said.

State Rep. Kathi-Anne Reinstein, D-Revere, said the state's four race tracks are more than just entertainment. Reinstein, whose district includes Suffolk Downs and Wonderland Greyhound Park, said thousands of people have relied on the tracks to make a living -- including herself.

"Working at Wonderland helped me pay for college," she said. "We should not be in the business of destroying lives and shutting down businesses."

Reinstein was speaking before a packed hearing by the Consumer Protection and Professional Licensure Committee. There were no bills about slot machines or casinos on the agenda, but the committee said it would hear testimony on the gaming industry.

Bosley said he would hold a hearing on slot machines and casinos in late October.

Critics say there are hidden costs associated with slot machines and casinos -- including the toll they take on those who may become addicted to gambling.

Bob Breen, head of the Rhode Island Gambling Treatment Program, said lawmakers have to ask themselves if they are willing to prey on those vulnerable to the promise of quick money.

"The message is we don't care if you lose the rent money in a casino, we just want to you to lose it in our casino," he said.

Gambling foes are also not convinced that casinos and slot machines will produce the promised tax windfall. Some of that will come at the cost of shutting down smaller, local businesses. The rest could be absorbed by the cost of treating those who become addicted to gambling.

"There's no money for us to make," Bosley said. "The numbers just aren't there."

But for those who rely on the tracks, the threat of losing their livelihood is a real cost, they say. About 4,000 rely on the tracks for their jobs, supporters said.

"I would ask everyone here to think about the social cost of everyone who will lose a job," said Sen. Marc Pacheco, D-Taunton, whose district includes the Raynham-Taunton track in Raynham.

Gaming board chairman fights back against lawsuit

PHILADELPHIA -- A state troopers' lawsuit seeking to prevent gambling regulators from hiring private companies to investigate applicant backgrounds is a power play with no legal grounds, the chairman of Pennsylvania's Gaming Control Board said Wednesday.

"This is more about money and power and control than it is about the merits of the case," chairman Tad Decker told reporters after a board meeting in a downtown Philadelphia hotel.

The 17-page suit, filed Monday with the state Supreme Court, argues that the July 2004 slot-machine gambling law gave state police the authority to conduct the background checks.

The Pennsylvania State Troopers Association also contended that the board, a legislative body, will be in violation of the constitutional separation of powers if it performs an executive function such as law enforcement.

The background checks will screen both gambling companies and vendors that supply the slots parlors, and are viewed as crucial to screening out organized crime. The firms, their executives and their employees -- about 30,000 in all -- will be investigated.

But performing background checks does not constitute law enforcement, and the law does not reserve such work solely for the state police, Decker said. He said state troopers can handle the criminal records searches -- which will constitute the bulk of the work -- but do not have the experience or manpower to conduct in-depth background checks and forensic accounting investigations.

The president of the troopers' union, Sgt. Bruce Edwards, said the troopers may cost more and may need to hire some financial experts to do the job, but can best protect the taxpayers' interest.

"You have to ask them why they may not want the state police to be the ones who are looking into things," Edwards said.

The lawsuit comes against the backdrop of a simmering, months-long disagreement between the board and the state police department over who should oversee and perform the background checks. The seven-member gambling board last month authorized its staff to negotiate no-bid contracts with three private firms, while also seeking others through a competitive bidding process.

Deciding how to proceed with the background checks is only one of the problems facing the Gaming Control Board as it scrambles to license slots parlors and get gambling-financed property tax cuts to homeowners as soon as possible.

For one, board members are trying to determine whether the July 2004 slot-machine gambling law allows an entity that owns a slots parlor at a race track to also own a minority share in an off-track slots parlor.

And the board is hung up on how many distributors to require slot-machine manufacturers to work through -- a provision that must be resolved before the board can license any slots parlors.

The Gaming Control Board's target date to begin licensing slots parlors -- by the end of March, Decker said Wednesday -- has steadily receded as the board struggles through litigation and bureaucracy.

The 14-month-old law legalized up to 61,000 slot machines at 14 venues, including seven at racetracks and seven at resorts and other unspecified sites.

No work has begun on the background checks, and the only applications that the board has received so far are from 10 manufacturers.

Lottery commissioner steps down to become judge

AUSTIN -- Texas Lottery Commissioner Rolando Olvera has stepped down from his post to become a state district judge in the Rio Grande Valley, the agency announced Wednesday.

Gov. Rick Perry last week named Olvera judge of the 138th judicial district court serving Cameron and Willacy counties. The governor will appoint his replacement to the three-person lottery commission.

Olvera "served with distinction and we appreciate his service," said commission Chairman C. Thomas Clowe.

The lottery commission is still searching for an executive director to replace Reagan Greer, who resigned in July after admitting he had signed off on advertising inflated Lotto Texas jackpots.

Eight finalists for the job will be interviewed by a search committee next month. Among the finalists is Dawn Nettles, a longtime critic of the commission whose complaint over jackpot inflation led to Greer's resignation.

The other finalists include an assistant attorney general from Louisiana who heads her agency's responsible gaming program; the president of a lottery consulting company who also worked for lotteries in Kansas and Colorado; and the executive director of the Texas Workers' Compensation Commission, which the Legislature abolished during this spring's session.

archive