A scathing letter from a licensed video gaming terminal (VGT) executive lays the blame for the “proliferation of illegal skill games in Pennsylvania” on Attorney General Josh Shapiro.
PA’s top law enforcement officer is also rumored to be a candidate for governor.
Commonwealth Gaming Vice President Amy Christie pointed to “non-enforcement” beginning with Shapiro’s office for the explosion of unregulated devices across PA. Her company provides VGTs to authorized locations in Pennsylvania.
Commonwealth made the charge in a May 3rd letter sent to Shapiro and copied to Governor Tom Wolf, the Pennsylvania Gaming Control Board (PGCB), and both houses of the state legislature.
PlayPennsylvania obtained a copy of the letter which is circulating widely in Harrisburg from a source other than Christie.
Shapiro and Wolf mum on illegal machines letter from Commonwealth
Contacted about her letter, Christie said of the illegal machines:
“They are everywhere. They are part of the landscape. Non-enforcement gives an opening.”
That does not appear to be an exaggeration.
Delaware County’s District Attorney recently told PlayPennsylvania he believes there are more than 20,000 of the devices in just his county. Legal, licensed and regulated slots and VGTs number less than 24,000 in the Commonwealth.
Shapiro’s office said questions should be directed to Wolf’s office, but otherwise did not respond other than to say a murder in Hazelton in December stemming from the presence of an illegal machine was not handled by the AG’s office. Jafet Rodriguez, who had routinely played an illegal video poker machine in Hazelton, allegedly murdered Ashokkumar Patel to steal gambling money.
Wolf’s office has not responded to requests for comment.
The PCCB, which funds grants for enforcement against illegal machines, declined comment.
Details from the letter about the spread of illegal devices
The letter alleges “severe damage this illegal gambling is causing to lawful regulated gaming in the Commonwealth.”
“The sad truth is that many truck stops which are eligible for legal gaming licenses are choosing to operate illegally, in light of the conscious decision not to enforce existing laws prohibiting illegal gaming, pending Commonwealth Court ‘Guidance.'”
It goes on:
“Our tax rate of 52%, consistent with casinos’ tax rates, have produced millions of dollars of revenue to Pennsylvania state coffers in the short time that we have been operating.”
The letter points out:
“Pennsylvania Attorney General, the Pennsylvania State Police, Pennsylvania Governor Wolf, and the Pennsylvania Gaming Control Board (through the Office of Enforcement Counsel) have all declared so-called “skill games” to be illegal.”
It also outlines Wolf’s stance:
“The administration believes Pennsylvania must take a hardline on illegal gambling, including so-called ‘games of skill’ and other slot machines. These machines are illegal, unregulated and put senior programs at risk by siphoning revenue from the Lottery.”
And most critically, it pointed to a position taken by Shapiro and reported first by PlayPennsylvania last June:
“The question of whether ‘skill games’ are legal is currently pending before the Commonwealth Court and OAG is representing State Police and the Department of Revenue in that litigation. While we continue to maintain that ‘skill games’ are illegal, as an agency, we have elected not to actively seize machines until the Commonwealth Court provides guidance on the issue.”
Shapiro’s elected position is independent of Wolf. Both are Democrats. Wolf had endorsed Shapiro for the elected AG’s post. Philly Magazine first reported that Shapiro hopes to be the Democrat candidate for governor in 2022 when term limits block Wolf from running again.
Blame directed at Shapiro for the explosion of illegal gambling devices
The letter states Shapiro’s position not to actively seize machines meant “illegal games have continued to proliferate with zero to minimal enforcement.”
The lack of oversight, especially during the virus pandemic, has meant “no regulations with zero closures, paying no taxes, and siphoning away their video gaming customers.”
Unlicensed operators pay host locations 30% to 40% of profits, said the letter. But state law limits VGT operators to paying 15%, setting up an uneven playing field.
Meeting pending to discuss illegal gambling issue
The letter closes:
“We are respectfully asking why enforcement is not occurring and is not being encouraged, especially when many counties have been awarded grants from the PGCB to rid their areas of illegal gaming. Legal and regulated gaming is under attack, and the lack of enforcement against what all levels of the Executive Branch of government within the Commonwealth have determined to be illegal gambling machines is allowing this illegal conduct to flourish.”
Christie said Shapiro’s office has responded, though she declined to share the contents.
But she said the AG’s Office has offered to set up a meeting with Commonwealth Gaming and additional parties in the gaming sphere to discuss the topic. A date is not yet set, according to Christie.
Commonwealth suing truck stop for replacing its licensed VGTs with unlicensed, untaxed, and unregulated devices
The pages-long letter includes photographs and a lawsuit by the Commonwealth against a truck stop in Snow Shoe. That’s a town about 30 miles from State College. Bally’s and a Philadelphia developer are planning a licensed mini-casino nearby.
The suit alleges Snow Shoe Travel Plaza turned off and removed its machines. Instead, it went with unlicensed, untaxed, and unregulated machines.
Kiran Grewal is the daughter of the couple who began using Commonwealth. Now she operates the location. She disputed details of the lawsuit. She said because she was now the operator, she could not legally operate Commonwealth’s VGTs as she is not licensed.
“They didn’t give us options, so we turned them off” and eventually removed the VGTs, Grewal said. The VGTs were replaced with what she said were “Pennsylvania Skill” machines. Grewal contended during a phone interview her machines are legal because they are Pennsylvania Skill machines.
However, photos included in the Commonwealth letter show the machines are not Pennsylvania Skill machines. A spokesman for the gaming company confirmed that to PlayPennsylvania.
She acknowledged, however, that the replacement machines are unregulated. That also means they are untaxed.
Pennsylvania Skills weighs in
A consultant to Pennsylvania Skills reacted to the Commonwealth letter with a letter to Shapiro.
Frank Noonan, a former leader of the PA State Police, began:
“I agree and acknowledge that there are thousands of illegal VGTs, masquerading as skill games, proliferating the Commonwealth.”
The rest of the letter attempts to differentiate his client’s machines from other devices sold as skills machines.
Noonan points out a court has ruled his client’s devices are skill machines. His letter alleges Commonwealth has conflated his client’s devices with others machines not covered by the court ruling.
Image c/o PA State Police.