TALLAHASSEE -- Jennifer Carroll’s surprise resignation last week as lieutenant governor was not the first time she had faced questions about her ties to Allied Veterans of the World, an Internet sweepstakes cafe operator now at the center of a $300 million fraud investigation.

As a member of the state House in 2010, Carroll filed a bill to legalize Internet sweepstakes cafes while she simultaneously consulted for Allied Veterans.

Back then, Carroll defended her relationship with Allied Veterans and the work it did for veterans groups.

“I do not know of any other company or organization in town or statewide that [has] provided this level of financial support to our veteran organizations,” Carroll wrote in comments she posted on jacksonville.com, the Florida Times-Union’s website.

Now, Carroll says she was duped.

“She was very shocked to learn — like many other public officials — of the allegations,” said Rick Oppenheim, who Carroll recently hired to handle public relations. “Ms. Carroll has spent almost a lifetime helping veterans and it was very disheartening for her to find out that this organization used veterans in this way.”

Carroll, 53, resigned last week after investigators questioned her about Allied Veterans as part of a nationwide racketeering and fraud investigation. So far, close to 60 people have been arrested as part of the case.

Carroll has not been charged with a crime. Her friends say she was too trusting of an organization that convinced her its mission was to help veterans.

She and her husband Nolan are former service members. They live outside Jacksonville in Clay County, a place where growth is spurred by the nearby Jacksonville Naval Air Station.

Carroll’s commitment to military causes seemed to be a good fit with Allied Veterans, which highlighted its philanthropic endeavors in the community, said Leslie Dougher, chairwoman of the Republican Party of Clay County.

“This was never ever about her personally,” Dougher said. “It was always about benefiting an organization and what they represented to help people.”

Carroll was elected to the state House in spring 2003. Four years later, Allied Veterans set up in nearby St. Augustine and began operating cafes in Duval, Clay and St. Johns counties.

The cafes operated in a gray area of the law, taking advantage of loopholes that allowed sweepstakes games and prizes — like the McDonald’s Monopoly game. But that drew the ire of Jacksonville Greyhound Racing, the owner of a racing track and poker room. As Allied Veterans fought lawsuits and accusations that they were operating illegal gambling operations, its leaders decided on a new approach.

Don’t put us out of business, regulate us, they told the Jacksonville City Council and commissioners in Clay and St. Johns starting in 2009. And to further the cause, Allied Veterans hired lobbyists and began reaching out to any elected officials who would listen.

Enter Carroll.

A former aide introduced Carroll to Allied Veterans that year, Oppenheim said. The aide thought Carroll’s public relations firm, 3 N. and J.C. Corp., would be a good fit for the organization, which sold itself as a military-focused nonprofit.

Carroll’s company received a one-year contract worth $6,000 a month plus travel expenses, she said. Allied Veterans hired the firm to help establish relationships with local communities and veterans organization. Allied Veterans also wanted to strengthen laws to shut down “bad apples,” Oppenheim said.