Cops say the machines are illegal, but there is nothing they can do about it

Police wait on injunction to clear court to enforce gaming law

Video gaming machines such as this one, found in a Harnett County business, have made a comeback thanks to an injunction in Onslow County that prevents law enforcement from removing the machines and charging the operators.
Video gaming machines such as this one, found in a Harnett County business, have made a comeback thanks to an injunction in Onslow County that prevents law enforcement from removing the machines and charging the operators.
Daily Record Photo/Rick Curl
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Internet gambling has quickly become what many law enforcement officials consider to be a hobby with an inordinate amount of repercussions, ones that cannot only drain players’ wallets, but can also strain families beyond repair.

“With that comes violence,” Harnett County Sheriff Wayne Coats said. “You’ve got domestic violence where the husband or the wife spends all the money instead of paying bills at the house. Then that falls into domestic violence and we [get] called out there.”

The violence isn’t limited to just the home. Each year, police say there are reports of assaults outside gaming businesses. The shops often go by such monikers as internet cafes, online rewards centers and some are even so bold as to call their stores casinos.

The most common of all crimes reported outside the establishments involves players being stalked and robbed. In most cases, according to Coats, players will win a significant amount of money, cash out and leave the premises only to be relieved of their winnings at gunpoint or knifepoint. Or the establishment itself becomes the thieves’ target.

“Then you’ve got robbery,” Coats said, referring to recent incidents in Wake and Durham counties. “The places are getting robbed. There was one incident where people won a large amount of money, the [other] people walked outside and robbed them.”

Coats said it’s really hard to determine how much operators of the machines profit from the games. He estimates — depending on the number of illegal machines in any establishment — operators can rake in thousands a week.

“I guarantee those machines, depending on how many they have, probably bring in $5,000 to $8,000 a week,” Coats said. “Here’s the thing, nobody’s going to win in the video poker machines, and the only ones who are going to win is going to be the owners. And if he didn’t have those machines set for him to win, he wouldn’t be in business.”

Despite some of the machines’ clandestine locations, Coats said they have one thing in common with their big brothers in Las Vegas and Atlantic City, New Jersey.

“It’s like Las Vegas, if those machines were for the customers to win, Las Vegas and Atlantic City wouldn’t exist,” Coats said. “It’s the same way with these, they’re not going to put a business in where they lose money.”

Chris Poole, special agent in charge of the Alcohol Law Enforcement Gaming Section, echoes the sheriff’s sentiment and notes there’s no protection against such practices.

“There is no protection or regulation to ensure patrons are playing a fair game,” Poole said. “These casinos advertise false hopes of winning large sums of money, when in fact, the amount of winnings a player will make has been predetermined before he or she ever sits down. North Carolina has gambling laws in place to protect the public.”

While the idea of playing video poker, online slot machines and other such electronic devices is generally illegal in North Carolina and in Harnett and surrounding counties, the ability of law enforcement to stop them has been hampered, recently, by a court decision in Onslow County.

Court conundrum

Onslow County awaits the results of a lawsuit and ensuing injunction filed by one of the companies, that makes the machines, and the internet company that pays winners with “gift cards.”

The sheriff’s office followed up on a complaint of illegal gambling with a raid on an Onslow County business in July 2013.

Deputies and ALE agents discovered several machines, which they say were being used for gambling while attempting to skirt the legal definition of an illegal gaming machine.

The result, in terms best understood by laymen, was an injunction against the ALE and the Onslow County Sheriff’s Office preventing the agencies from removing or confiscating the machines.

While the injunction is in Onslow County, ALE has been reluctant to make any major raids or take any actions to remove machines in other parts of the state because of it. While that case is pending a hearing in the 4th U.S. Circuit Court of Appeals, machines across the state are still in operation to the chagrin of law enforcement.

“Most of them lock the doors so law enforcement can’t get in. They only let certain ones in they know,” Coats said. “The Pot O’ Gold machine, and anything in a box frame, those were illegal from day one.”

Some companies have turned to internet-based devices to keep the law’s ambiguities in their favor.

To circumvent the law even further, Coats said the establishments use machines that are internet based for their functions.

“They’ve started using computers, which is a way just to circumvent the legislative past,” Coats said. “The legislators are now working on ways to shut them down. They’re just waiting on the ruling in Onslow County, from what I understand.”

According to the lawsuit, the internet sweepstakes devices are similar to a slot machine, containing multiple games and offering payouts through the other complainant in the lawsuit, Gift Surplus, LLC, in the form of gift cards that are redeemable on the company’s website.

Law enforcement officials say they suspect the payouts could be easily converted to cash on the website.

The Daily Record reached out to Gift Surplus but received no response.

“They’re waiting to hear about the internet sweepstakes, it’s a certain type of machine,” Coats said. “But those are the only ones really legal right now, and they’re not really legal. They just filed an injunction and until it’s heard, you can’t mess [with] those machines.”

It’s a problem

Although Harnett County may not be inundated with the machines, Coats says their presence is still a problem and he knows where they are as he waits for the day his officers can enforce the law.

“There’s three or four that have popped up,” Coats said. “There’s one in Mamers, there’s one or two down off 210 South going toward Spring Lake. There’s one out on 87 and that’s what got my attention. I’m getting calls on them now. I know there’s three or four that have popped up outside the municipalities.”

The machines have even popped up in barns.

“They’re in businesses and there’s no telling how many are in houses we don’t know about. People are operating them in barns and all,” Coats said. “The one we got off Jonesboro Road a year or two ago was in a man’s barn. He had five to 10 machines in his barn.”

Because of those locations, Coats is faced with a difficult task and few choices on how to deal with it. Under current legislation, the sheriff’s office can’t act on the locations without first being requested to do so by ALE.

“All I can do when I get complaints is I forward it to ALE,” Coats said. “If they ask for our assistance, we will help them.”

Coats said the number of calls did slow considerably after legislation was passed that better defined which machines were illegal, but he said until Onslow County’s injunction is finally decided, things will go on much like they are now.

“It tapered off when the legislature passed the law that video sweepstakes were illegal and now there’s another comeback because of that injunction in Onslow County,” he said. “It’s a big business.”

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