11 Arrests in Alabama Bingo Investigation

11 Arrests in Alabama Bingo Investigation

By CAMPBELL ROBERTSON
Published: October 4, 2010

Last spring, reports of a federal corruption inquiry began trickling through the Alabama Legislature as its members argued fiercely over a bill to allow some form of gambling in the state. Several legislators received subpoenas, others acknowledged wearing wires and still others said they had received surprise visits from F.B.I. agents.

In their offices and along bar stools after work, lobbyists and politicians speculated feverishly about what would become of it.

On Monday, they found out.

Four state senators, three lobbyists and two powerful and politically connected businessmen were among 11 people arrested and charged by federal investigators with being part of a wide-ranging conspiracy in which lawmakers were offered generous campaign contributions in exchange for pro-gambling votes. All are facing possible jail time.

At a hearing in Montgomery, Ala., on Monday afternoon, Terry Moorer, a United States magistrate judge, did not allow any of the defendants to enter a plea, though they were all let out on bail. The next hearing is set for Oct. 15.

The 65-page indictment, which was accompanied by a guilty plea from one lobbyist who said she had participated in the scheme, includes wiretap transcripts in which targets fretted about whether they were on a “safe line” or if “friends are listening.” One legislator is said to have complained of not “feeling the love” after having supported the gambling legislation. In a lengthy quoted passage, a lobbyist told a legislator that he would need to find “a backdoor way” to arrange a payoff.

A statement on behalf of Gov. Bob Riley said he had “called the gambling bill that passed the Senate earlier this year, ‘the most corrupt piece of legislation ever considered by the Senate,’ and today’s action by the Justice Department shows he was, sadly, right.”

The indictment was met with deep suspicion in some quarters of Montgomery. Proponents of legalized gambling, most of whom are Democrats, said they saw behind the investigation the political machinations of gambling opponents, including Mr. Riley, a Republican. That the charges came within a month of the November elections particularly troubled some.

“Anyone who loves democracy and freedom should be concerned with the timing of these indictments,” said Ron Sparks, the Democratic candidate for governor, in a statement. “Waiting to announce indictments after the election would have had no impact on the cause of justice.”

Lawyers for several defendants maintained their innocence, and State Senator Harri Anne Smith released a statement, calling the charges “a nakedly political move, coordinated by prosecutors in cahoots with the governor’s office.”

Such mistrust has been heightened here since the conviction of former Gov. Don Siegelman, a Democrat, in a case many still insist was politically motivated.

Lanny Breuer, the assistant attorney general for the criminal division at the Department of Justice, rejected such suspicion, saying that the case was run out of Washington with local assistance, not the other way around.

As for the timing, he said, “we let the facts take us and when we were ready to bring the case we did.” Mr. Breuer said the investigation was continuing.

Of the indicted legislators, two were Democrats, one an independent and one a Republican who recently switched parties.

Their arrests were undoubtedly shocking to many, but possibly even more startling was the arrest of Milton McGregor, 71, the owner of VictoryLand, an enormous greyhound track and casino complex, and a longtime Alabama power broker with deep pockets and well-placed friends.

Mr. McGregor was charged along with Ronald Gilley, who was developing a casino complex in southeastern Alabama, with orchestrating a scheme to bribe politicians through lobbyists, often disguising the payments by donating to political action committees. Mr. McGregor also allegedly arranged to pay a legislative analyst who works for the state to amend the wording of pro-gambling legislation.

His lawyer released a statement, insisting on Mr. McGregor’s innocence and claiming that the investigation was “mainly a political dispute” over the legality of gambling.

The legal status of gambling has easily been the most incendiary issue in the state over the past couple of years. So-called electronic bingo machines have sprouted up throughout the state at the invitation of strapped local governments, which receive proceeds from the machines.

Opponents, including the governor, argue that the devices are essentially slot machines and thus against the state Constitution, a position that the courts have generally supported. The governor has shut down casinos all over the state.

For the past two years, state legislators have proposed legislation that would have put the legalization of electronic bingo up for a vote and enabled its taxation. Over two noisy months this spring, the State Senate voted, and re-voted, on such a bill (a similar bill stalled in the House). According to the indictment, this period is when the alleged conspiracy unfolded.

The indictment depicts some legislators actively soliciting payoffs from the casino operators. One of the lobbyists is quoted complaining to Mr. Gilley of “a shakedown” by one state senator, Larry Means, who was demanding $100,000 in exchange for his vote (Mr. Means was allegedly promised it later that day).

In other cases, the casino owners and lobbyists are depicted scrambling to ensure the support of legislators who appear to be on the fence. The alleged promises to James Preuitt, a five-term senator who owns a car and truck dealership in Talladega, Ala., included $2 million in campaign contributions and the possibility that a country music star would come to his dealership to buy trucks.


Kyle Whitmire contributed reporting from Montgomery, Ala.