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  1. Florida Politics

Florida House votes to ban Internet cafes

After a large turnout for the rally, patrons fill Spinners Sweepstakes Cafe. The rally was organized by Spinners’ owner Terry Kasberg.
Published Mar. 23, 2013

TALLAHASSEE — Stung by a criminal investigation into an online gambling ring that poured $1.4 million into legislative campaigns, the Florida House on Friday voted 110-6 for a bill aimed at shutting down Internet cafes, adult arcades and Miami's "maquinitas."

"It's a great day in the Florida House," said Rep. Carlos Trujillo, R-Miami, who sponsored the bill. "This will be one of the largest contractions of gaming that we've experienced in our state, certainly in the last 50 or 100 years."

The bill attempts to clarify state law by specifying that charity organizations, adult arcades and for-profit sweepstakes operators may not operate permanent gambling centers using casino-style games that portend to be games of skill.

Opponents blasted the measure as a knee-jerk reaction to a political scandal and warned that the bill will have the unintended consequence of putting hundreds of owners out of business and sending their employees to the unemployment office.

"Here we are today going to outlaw something that for the past 30 years has been legal in the state of Florida," said Rep. Jim Waldman, R-Coconut Creek. "If we're going to do that, what's next?"

State Rep. Betty Reed, D-Tampa, was the lone Tampa Bay legislator to vote against the ban. Rep. Dwight Dudley, D-St. Petersburg, originally voted to oppose the ban but later changed his vote.

The measure, HB 155, comes a week after federal and state officials arrested 57 owners and operators affiliated with Allied Veterans of the World, a St. Augustine chain of 49 Internet cafes, charging them with illegal gambling, money laundering and racketeering.

Authorities say the company collected a combined $300 million in profits since 2007 but paid out only 2 percent — about $6 million — to charities.

The investigation also prompted the resignation of Lt. Gov. Jennifer Carroll, who consulted for Allied Veterans when she served in the Legislature.

The bill updates the definition of slot machine and spells out that they are prohibited under Florida law, even if they require an element of skill or are linked to a network of machines.

It prohibits arcades from giving away gift cards, prohibits patrons from accumulating points and limits cash prizes to 75 cents per game.

It also clarifies that amusement games used at children's arcades, such as Dave & Buster's or Chuck E. Cheese's, are exempt from the law.

"Internet cafes have been a blight on Florida for many years, and I am proud of the House for once again voting to shut them down," said House Speaker Will Weatherford, R-Wesley Chapel. "With the recent crackdown on racketeering and fraud, I hope this will be the year when the House bill finally becomes the law of the land."

For years, law enforcement officers, led by Seminole County Sheriff Don Eslinger, have warned legislators that Internet cafes were operating illegal slot machines that paid no taxes and provided no customer safeguards. Eslinger's department is among several law enforcement agencies prosecuting the case against Allied Veterans.

Last year, the state House of Representatives passed a bill to ban the machines, but it was blocked by the Florida Senate, which wanted to regulate them.

Absent a compromise, the gaming centers continued to proliferate in strip malls and storefronts around the state, and their owners have steered millions into legislative campaigns.

A Times/Herald analysis found more than $1.4 million went into legislative coffers from 78 people or companies linked to Allied Veterans of the World from 2008 to 2012.

Shamed by taking vast amounts of cash from what police now say was a fake charity, many legislators have been scrambling to return it.

Lenny Curry, chairman of the Republican Party of Florida, announced the party would donate $300,000 to a state-run veteran's group, though the party received a total of $533,830 from Allied Veterans groups, according to the Times/Herald analysis.

The Florida Democratic Party, which received $244,000 from the groups over the same time period plans to donate the funds to a veterans charity but has not announced further details, according to party spokeswoman Brannon Jordan.

Sen. Miguel Diaz de la Portilla, R-Coral Gables, who led the Senate charge last year to regulate the industry but not ban it, was among the top lawmakers to receive contributions from Allied Veterans.

He and an affiliated political committee received $69,500 from Allied Veterans affiliates, the analysis found. He said he had counted only $15,000 "but the total contribution makes no difference."

Sen. Joe Negron, R-Palm City, got $25,000 through his Florida Conservative Action Committee.

He said he plans to raise the same amount and contribute the money to the Wounded Warriors Project.

"If these allegations are proven, what concerns me greatly is that (Allied Veterans) may have exploited veterans," he wrote in an email to the Times/Herald.

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