Fraud, Deceit and Corruption in the Gambling Industry

Real Economics of Gambling

             FRAUD, DECEIT AND CORRUPTION IN THE GAMBLING INDUSTRY

                            by Nelson Acquilano, LMSW, CASAC, CPP, MPA

     There has been more fraud, corruption and deceit with gambling than with any other social problem.  It is inherent is the nature of gambling and the extreme greed and money associated with gambling.  The OTB and several New York racetracks were notorious for their fraud and corruption, showing that gambling and ethical corporate practice are incompatible partners.

     Governor Cuomo prides himself on running an ethical government, yet the fraud, corruption and deceit with this gambling issue has been anything but ethical.

  • Common Cause reported in 2012 that since 2005 gambling interests had spent $47 million on lobbying ($40 M) and  donations to political campaigns ($7.1 M)  in NYS http://www.commoncause.org/site/apps/nlnet/content2.aspx?c=dkLNK1MQIwG&b=5287775&ct=12188661 These outlays  included $2M  to the Committee to Save New York (a short-lived business-backed group closely aligned with Gov. Cuomo); Andrew Cuomo received $715,000; Eliot Spitzer $594,000; David Paterson $204,000; $3.9 million went to the candidates and committees of the State Legislature; and to other State Senators and Assemblyman and candidates. 

 

  • The Seneca Nation soundly voted DOWN a Gambling Compact on May 11, 1994, when Members of the Seneca Nation of Indians rejected a proposal to get into high-stakes casino gambling in an advisory referendum.  The casino proposal was defeated by a vote of 714-444; the nation’s leaders brought it back again and imposed it as “the will of the people” and it later passed on May 15th, 2002 because of passivity – not because it was the will of the people. 

 

  • Racinos now term themselves “casinos,” against the law, to increase crowds and profits; downstate racinos have now put in electronic table games in which the outcome is not determined by the Lottery’s central computer in Schenectady.  This violates the definition of lottery implicit in the opinion of the court in Dalton v. Pataki 2005 .   Deceit or fraud? http://www.nydailynews.com/opinion/doubling-casinos-article-1.1340994

 

  • The gambling syndicate tells you that gamblers generated $5.4 billion in revenue in New York State in 2010, rather than telling you that New York residents and visitors LOST $5.4 billion that year.  They also do not tell you that much of that money was not “disposable income,” but monies taken and lost from family savings and family support, from child support, money borrowed against life insurance policies or college funds, monies lost from social security or welfare support, or monies embezzled from businesses and industry.

 

  • Spokespersons for “gaming” won’t tell you that as according to a 2006 NYS OASAS (Office of Alcoholism and Substance Abuse Services)  study,  there were already 668,000 problem gamblers in New York State; and that 10% of adolescents meet DSM-IV criteria for problem gambling; and another 10% of youth are at-risk of developing a gambling problem. 

 

  • Proponents of more casinos won’t tell you that adding  seven  new casinos to  New
    York State  could (depending on siting)  create up  to 82,000 new pathological gamblers (a 47% increase), and  202,000 new problem gamblers.  They also “neglect” to say that quantifiable socioeconomic costs  related  to  ONLY new gambling addicts and problem gamblers are more than double than the tax revenues due to the state from licensing up to seven new casinos and taxing them (at 20% overall) on the take from all users. http://cagnyinf.org/wp/new-casinos-equal-1000s-of-gambling-addicts/

 

  • Slot machines are illegal under the NYS Constitution, thus, soon after 2001 they were re-termed VLTs (Video Lottery Terminals) in the courts to get around the law !

 

 

  • The May – June 2013 arrangements  re tribal casinos and exclusivity zones are expedient, intended  to  head off  opposition by the operators of tribal casinos to the proposed constitutional amendment that would legalize non-tribal casinos.  The pact with  the Oneida Nation of Indians is going to litigation,   with the towns of Verona and Vernon as plaintiffs.     Days after the Oneida agreement, Gov. Cuomo’s administration  forgave  the Senecas $209 million dollars  that the State had previously held were due  it under a compact that the Seneca Nation of Indians viewed as having been violated when VLTs came to racetracks in western New York State.  

 

  •  The very fact that the casino amendment was rushed through on the last day of teh legislative seesion without either a Health Impact Study or a formal cost-benefit study is a deceitful practice!

     Permission is hereby given by Cagnyeditor to reproduce this post by Nelson Acquilano in whole or in part as long as the permalink above is cited.  Photomontage by Nelson Acquilano

 

 

 

 

 

 

 

 

 

 

Two Downstate Racinos Are Downstate Casinos Now

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        For  practical purposes, there are at least two non-tribal full-service casinos operating today in New York State. If that surprises you, read on.   The facilities at Aqueduct  and at Yonkers call themselves casinos yet pose as “racinos.”  In my opinion they are real casinos, cleverly disguised as “racinos.”   They don’t have human croupiers or dealers, but offer table games in which the outcome of a play is governed by the same  laws of physics that determine the outcome of a throw or spin  by a human being.  Such table games are billed as part of lottery.  I say  they are illegal.  What’s your opinion?   

     An editorial in the New York Daily News May 5 showed that at Resorts World Casino (Aqueduct Racino) “electronic table games” of craps, Bo-Sic, roulette,  and baccarat are bringing in a good part of the “video gaming” revenues. 

http://www.nydailynews.com/opinion/playing-games-law-article-1.1334713

     I am not a lawyer, but was persuaded by the carefully-researched editorial and by my own reading of the opinion of the Appeals Court in 2005 that these games are not permitted under the present New York State Constitution.  Though operated by NYS Lottery, they do not meet the definition of “lottery” in the same way as do video lottery terminals (VLTs).

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