Florida needs to shut down predatory gambling houses

Florida needs to shut down predatory gambling houses
April 3, 2012By Scott Plakon Guest Columnist

You may assume an "Internet cafe", like the ones that are popping up in strip centers throughout Florida, are gathering places to access the Internet, enjoy a cup of coffee, or conduct a business meeting. But walk inside and you will find something quite different. These Internet cafes actually house dozens — or hundreds — of computer terminals. People using these terminals aren't surfing the Web. They aren't using Skype. They aren't sending e-mail.

Instead, they are playing slot-machine style games in the hopes of hitting the jackpot. But the operators say that it's not gambling, but merely sweepstakes contests. They compare their operations to the Monopoly sweepstakes that McDonald's runs once each year. They are cleverly exploiting loopholes in Florida's sweepstakes laws to open gambling houses without the authorization of state or local authorities and without voter approval.

But their deception does not stop there. Many of these gambling cafes are operated by groups branded as charities that supports veterans. But a close examination of tax records for "Allied Veterans of the World and Affiliates" turns up very little in the way of charitable giving compared with its gambling cafe revenue. The Florida Department of Agriculture and Consumer Services' "Gift Giver's Guide" estimates the group donated only 1 percent of the money it spent in 2009, with 99 percent being spent on "Administrative Expenses."

The good news is that prosecutors and policymakers in some parts of Florida have had success shutting these operations down. In Central Florida, prosecutors have shut them down in Orange and Osceola Counties, successfully arguing that they are unlawful gambling establishments. A recent federal court ruling has also cleared the way for Seminole County to enforce a ban that local commissioners adopted in the wake of violent crimes at these facilities. This ruling will likely embolden local governments throughout Florida to adopt similar measures. But that is no substitute for having the Florida Legislature eliminate the loopholes that are being exploited. With support from Gov. Rick Scott and the entire Florida Cabinet, my bill to shut down these harmful operations was approved by the House this year, but unfortunately died in the Senate.

No matter what your position is on gambling in Florida, there are important reasons why these gambling cafes have no place in Florida. Those who profit from these shady businesses argue that the state should regulate them — not shut them down. They want this because regulating them would give them the legal legitimacy that they lack today. Regulating these storefront casinos would reward those who have chosen to break or skirt our laws. It would grant amnesty to current operations, and potentially invite more. And having the state legitimize these operations would likely violate the compact that the state has with the Seminole Tribe — allowing the Tribe to stop paying the state the hundreds of millions of dollars it has agreed to as the exclusive operator of certain forms of gambling.

But the most important reason these gambling cafes need to be shut down is gambling brings costs to society and taxpayers. According to a recent exposé in BusinessWeek, most Internet gambling cafe patrons are elderly and poor. Many of the locations even dispense welfare cash. Crime and addiction are the inevitable consequences of predatory gambling. Because of the convenient access to highly addictive gambling they provide, these establishments make millions preying on those who can least afford it. That means more people addicted to gambling, more dependency on taxpayer funded support programs, and more crime committed to support gambling addictions.