Gov. Rick Scott signs Internet cafe ban bill into law

04/10/2013 1:24 PM

04/10/2013 7:17 PM

Gov. Rick Scott has signed a bill to give law enforcement authorities better tools to put an end to illegal gambling devices in strip malls and arcades throughout the state.

With no fanfare, the governor signed the bill in the privacy of his office Wednesday when he returned to the Capitol after making a jobs announcement earlier in Lakeland.

The measure, HB 155, was approved in response to a three-year federal and state investigation into illegal gambling at Internet cafes affiliated with Allied Veterans of the World, a St. Augustine-based charity organization, and has already resulted in job losses for hundreds of workers in now-shuttered operations.

Authorities allege that Allied Vets and their affiliates collected $300 million in revenue but only donated $6 million to charity. Former Lt. Gov. Jennifer Carroll resigned in the wake of the investigation and subsequent arrests because she had once worked as a consultant for the purported charity organization. She resigned, she said, to avoid becoming a distraction to the governor.

"I think the House and Senate did the right thing to crackdown on illegal gaming, especially in light of the Allied Veterans multi-state criminal conspiracy,’’ Scott told reporters on Wednesday.

Scott would not respond to questions about the 14,000 people who are expected to be put out of work because of the law. "I have a jobs agenda,’’ he said, urging the Legislature to pass his proposal for eliminating the sales tax on manufacturing equipment, one of his two priorities this session.

The Florida Arcade Association, which has fought the legislature’s attempt to include their machines in the crackdown, said the action put a “closed” sign on more than 200 arcades and businesses throughout the state and put other arcade businesses in legal jeopardy.

“With the stroke of the governor’s pen, thousands of jobs were lost today. With all the effort that is put into this state to create jobs, it is unconscionable that the state is acting to put people in the unemployment line,” said Gale Fontaine, the association president.

The law becomes effective immediately, giving law enforcement new definitions on illegal gambling machines. It also imposes new restrictions on arcade games and bans all electronic casino look-alikes, including maquinitas in Miami and Hialeah.

Miami-Dade Mayor Carlos Gimenez, who praised Scott and state lawmakers for passage of the bill, wasted little time in directing county law enforcement authorities to take action.

“I have already directed Miami-Dade Police Director J.D. Patterson to begin enforcing the law,” said Gimenez in a statement. “There is no longer any ambiguity about the fact that these machines and operations are illegal, and the newly-signed law will help deter the continued growth of illegal activities in Miami-Dade County and throughout the State of Florida.”

For the past three weeks, Internet cafes and adult arcade owners throughout Florida have already been closing down, dismantling equipment and laying off workers in anticipation of the move. There are an estimated 1,000 Internet cafes in Florida and more than 200 adult arcades.

For years, lawmakers had ignored warnings from law enforcement that the gray areas of the law had allowed for the proliferation of the illegal games. But the arrest of 57 owners and operators associated with Allied Veterans put pressure on Florida legislators to move with record speed to outlaw the gaming machines.

Seminole County Sheriff Don Eslinger, who anchored the federal and state investigation called “Operation Reveal the Deal,” told the Herald/Times that the governor’s actions validated his efforts.

For years, Eslinger was among a handful of sheriffs that urged lawmakers to tighten the law to make it easier for law enforcement to crackdown on the illegal games only to have their proposals languish and Internet Cafes proliferate. In the meantime, the industry donated millions to legislative campaigns, estimated at more than $2 million in the 2012 election cycle alone.

“It wasn’t a loophole in the law,’’ Eslinger said Tuesday. “The law was complex, difficult and expensive to investigate — and this will certainly will enhance law enforcement efforts.’’

But the arcade machine manufacturers, two of which are based on Hollywood, say they are poised to challenge the law and are seeking ways to retrofit the machines.

The arcade industry, which is allowed to operate games only if there are a minimum of 50 games in play, is in the process of hiring a lawyer to allow them to challenge the law for its lack of clarity. It has already begun an effort to show that law enforcement has engaged in selective enforcement of the current law.

They are asking operators and patrons of adult arcades to file complaints with police about machines that are operated at children’s arcades, skating rinks, movie theaters, restaurants and retailers that could fall under the ban because they currently aren’t operated by owners with at least 50 machines on site.

“Everybody is just waiting to see what they can do,’’ said John Sasso, sales manager for Electromatic International Inc. a machine manufacturer also based in Hollywood.

He has called on arcade owners to scout any illegal games operating in retail stores and children’s entertainment centers, such as Denny’s Golden Corral, Wal-Mart, Chuck E Cheese and Dave & Busters, and report potential violators to police.

“It is sad to say that most locations are now closed due to HB 155,’’ Sasso wrote in a note to arcade owners. “But it is not over. There are still several legal maneuvers that need to happen before burying the key.”

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