Outlaw 8-liners siphon profits from legal business

Outlaw 8-liners siphon profits from legal business

Last week, The Examiner revealed the problem of numerous illegal gambling dens spreading throughout the area and their negative impact on the community, particularly gambling addicts and the area’s most vulnerable residents. But the poor and the elderly are not the only ones affected by the area’s saturation of game rooms, which are filled with machines known collectively as eight-liners. Legitimate owners of legal businesses also suffer.

Not-so-booming business

Bridge City resident Tina Cotton manages the Lucky Longhorn Casino in nearby Vinton, La. She said the illegal use of coin-operated, casino-style amusement machines for gambling in Texas has caused her business to wilt. She said the game rooms in Texas have affected her business “tremendously.”

“It’s a big thorn in my side,” Cotton said about the illegal gambling in Texas. “It’s amazing how rampant it is. How can they be so blatant and bold? People are gambling all over the place (in Texas). Our business has gone way down. It just makes me ill. Legalize it or don’t legalize it.”

Cotton said she believes gambling addicts who can’t get their fix in Louisiana due to strict scrutiny by employees and operators trained to recognize them go to Texas to play the machines.

“At least in Louisiana, we have rules to help addicts,” Cotton said. “The people with gambling problems can’t gamble in Louisiana. We put a 1-800 number (gambling addiction help line) on all advertising. It’s required by law in Louisiana – it’s on all the flyers and billboards. There’s a program. We have to take a class to help us recognize when someone has a problem. It is a class similar to the TABC class you have to take to sell alcohol in Texas.”

Sgt. Mike Custer of the Beaumont Police Department’s special assignments unit said that, in Texas, sometimes the law is what stands in the way. He explained that when police raid a gambling facility, they do not seize the entire gambling machine. Instead, they remove the motherboard from the machine. The computer components are easily replaced, however, and the machines can be up and running again in a short time.

As the law stands now, the police are not able to enforce the licensing and cannot seize the machines.

“About two years ago, I went to Austin with some officers from Galveston to talk to the Senate subcommittee on gambling,” Custer said. “The state comptroller’s enforcement branch has specific rules, rules which only they can enforce, and what we were asking for is for some laws to maybe get those rules relaxed to where local law enforcement could enforce them. And maybe some laws to help regulate gambling. My thought was that whether gambling comes here or not is immaterial to me. We play the hand we are dealt.

“Whatever laws are passed are the ones we use. We need to deal with these nuisance game rooms that just pop up. The state comptroller’s division can go in and find a machine and if doesn’t have a sticker on it, they can seize it.”

Custer said that if gambling does become legal in Texas, it would be best to have “our house in order.”

Cotton agrees. In order for her to operate the Lucky Longhorn, she had to jump through several legal hoops and meet specific guidelines set up by Louisiana’s Gaming Control Board.

“We have to go through a background check,” Cotton said. “Every single employee we have has to have a gaming permit. You can have no record of theft at all or you cannot work in the gambling business in Louisiana. We have to have fire permits and safety permits. We have to get (general) licensing every year. Every five years we have go through a big license renewal. We get fingerprinted and everything.”

Show me the money

Cotton said Bridge City taxes the machines. The city confirmed the tax it charges is one-fourth the amount of the state tax, so the amount taxed per machine is $15. Cotton feels the city does not want to close down the game rooms because they profit from the imposed taxes.

In Custer’s opinion, the machines are making thousands of dollars per day and are not reporting all of that income, thereby evading the income tax on the unreported profits. The licenses for the games cost only $60 per year apiece.

“We have to prove where the money goes,” Cotton said of her business. “We pay one-third of every dime we make in taxes. It goes to the state. That’s on top of the machine tax. The machines are tied into the state. They know every time we open the machine. They know about every nickel that goes in there. It is very closely regulated.”

Cotton said the payout limit for her machines is $1,000, but illegal gambling payouts can be much higher. She said she knows of one illegitimate game room that paid a gambler $2,000. She believes the higher jackpot may draw gamblers, but she does not think the illegal facilities pay as often because they are not regulated.

Custer said sometimes, they don’t pay at all.

“This is kind of ironic,” he said. “We get complaints from people who are participating in the illegal gambling, then the people (operators) say ‘no, I’m not going to pay you.’ Uniformed patrols have answered numerous calls of people who were in there gambling illegally and then when it came time to pay, the operators wouldn’t pay and the people were mad.”

Devil in disguise

Custer cautions the public to be wary before entering unknown businesses around the area. He warned that consumers cannot always assume they are entering a legitimate business due to the measures game room operators take to disguise their purpose.

“Some of these places (game rooms) are storefronts,” Custer said. “It looks like a dollar store but there is a door in the back that leads to 20 machines. We gather the intel and work with narcotics and vice guys to deal with them as we can. Trying to get to the machines is the hardest part.”

Cotton said she once chanced upon what she thought was a fireworks stand, only to find out upon entering that it was filled with eight-liners.

“There were no fireworks at all,” Cotton exclaimed. She said the fact businesses are covering up their actual services indicated to her that something is not up to par.

Custer and other investigators have noticed the same thing. Still, he said their hands are often tied when it comes to enforcing laws pertaining to illegal gambling.

“Again, the problem is that there is a potential legitimate use for these machines,” he said.

For Part 1 in this ongoing series, click here:

http://theexaminer.com/stories/news/illegal-gambling-brings-millions-few-arrests-0

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