Perjury indictment reveals major flaws in state's slots gambling law
The connection between gambling and organized crime is almost a cliche. Yet, as with most cliches, there's plenty of truth there.
So, should Pennsylvanians be surprised when the owner of one of the state's new casinos is indicted, and accused of lying about his connections to organized crime?
Few would argue that it's a surprise that some shady dealings in Louis DeNaples' past would have cast doubts on his qualifications to operate a casino. Yet he was granted a license by the state gaming board.
Other people, including one state police official, are labeling the whole affair an embarrassment.
The indictment against DeNaples, 67, charges that he lied about his relationship with two regional crime bosses when he was interviewed as part of the process for applying for a casino license.
Last week's indictment triggered a suspension of DeNaples' slots license and he is, for now, barred from running or having any contact with the Mount Airy Casino Resort. The state gambling board has appointed a trustee to oversee the casino while the charges against DeNaples are resolved.
Neighboring New Jersey had some problems with organized crime when legalized gambling came to Atlantic City in the late 1970s and early '80s. But there are differences between the states.
In New Jersey, the investigation process for potential casino operators looks at the applicant's entire history, and does so in public hearings. In Pennsylvania, our public officials decided that any felonies more than 15 years old were not to be considered, and the hearings were not public. Also, in Pennsylvania the gaming board did the investigation, and also made the license decision.
Immediately, some questions come to mind.
Why would Pennsylvania not consider a felony just because it happened more than 15 years ago?
In 1978, DeNaples pleaded no contest to charges that he was involved in bilking the federal government out of $525,000 involving Tropical Storm Agnes recovery funds.
Why would Pennsylvania officials not think this should be an issue for a slots gambling license?
A New Jersey official questioned having the gaming board do the investigation and also making the license decisions. A better system would have an independent investigation done by the state Attorney General's Office or the state police.
The same grand jury that indicted DeNaples also suggested that all future slots license investigations be done by either the state police or the Attorney General's Office. In addition, the grand jury argued for a more open licensing process.
DeNaples' perjury trial should be just the start of cleaning up Pennsylvania's slots licensing. Without changes to the process, all future slots licenses will be suspect.
There should be investigations into how the legislation was drafted that mandated overlooking felony convictions older than 15 years.What lobbying was involved in getting this provision inserted into the slots law?
The public also deserves an explanation as to why the state police or Attorney General's Office was not put in charge of investigations. What now appears to be an obvious shortcoming in the slots law is the product of the same people who initially proposed banning the Attorney General's Office from investigating any alleged crimes related to slots gambling. It would be interesting to know which lawmakers and lobbyists were behind that provision.
"The fiasco surrounding the DeNaples license is a national embarrassment for Pennsylvania," is how the head of the Pennsylvania State Troopers Association put it.
Apparently gambling board members had doubts about DeNaples' testimony and believed he was lying. Yet they granted him a casino license. Why?
The state police were conducting their own investigation of DeNaples at the time he was appearing before the gaming board. But the state police say they were not legally allowed to share the evidence in their probe with the gaming board.
At this point, it's not clear where most of the blame lies — with the gaming board, state police or the slots law. Regardless, it's still an embarrassment.
If there were any suspicions about DeNaples or his testimony, the gaming board should have erred on the side of caution and refused to grant a slots license until all doubts about his alleged connection to organized crime had been addressed.
Rendell and state lawmakers can boast about the money that slot machines are bringing to the state treasury with the promise of eventual property tax relief, but for now they should be forced to explain how a slots license was given to DeNaples.
It looks like incompetency or worse. And the blame appears to be shared by the General Assembly, the governor's office, the state police and the gambling board itself.
