DeWine launches effort to close Internet cafes

VIDEO: Prosecutor Paul Gains on internet cafe crackdown

By Marc Kovac


Ohio Attorney General Mike DeWine launched a new effort Wednesday to shut down Internet cafes — and followed up later in the day by raiding a half- dozen sweepstakes parlors in Cleveland and seizing related bank accounts.

In a morning briefing with officers and prosecutors from across the state, DeWine announced the formation of a working group in his office to assist in local prosecutions of sweepstakes-parlor operators.

“The law is clear, and I intend to enforce the law,” he said. “In fact, I feel I have no choice but to enforce the law. I intend to work with these officers, these chiefs of police and these prosecutors here today and others around the state to make sure that Ohio law is enforced and that this illegal gambling is eliminated.”

DeWine said a lack of action by state lawmakers, combined with a new appeals-court decision, pushed his office to act.

“[The indication is] the Senate is not going to move for some time, and we have an obligation to now enforce the law,” DeWine said, adding, “We are now committed to fight this battle county to county and courthouse to courthouse. ... When there is gambling that is out in the open, it’s right in our face; when people are flouting the law and making a mockery of the law in the state of Ohio and laughing at us ... we have to take action.”

But the attorney representing sweepstakes parlors in the appeals-court case said DeWine’s decision is “just plain wrong,” and lawmakers already have defined and established the legality of sweepstakes parlors in state law via legislation that placed a moratorium on their operation and registration requirements.

“As long as you meet the definition and you filed your affidavit, you’re protected,” said Don Malarcik. “I’m disappointed and a little disheartened by the attorney general’s office, but any reliance on [the 8th District Court of Appeals decision] to prosecute cafes today is improper.”

DeWine has called for a crackdown on Internet cafes for more than two years, backing law changes offered and passed by the Ohio House that have stalled in the Ohio Senate.

Multiple bills have been introduced directed at what have commonly been called Internet cafes, though the businesses are not the typical coffee shops where customers go to read email or browse websites. Generally, patrons purchase phone cards upon entering, buying a chance to win sweepstakes prizes and using computers that resemble slot machines.

About 800 of the businesses have registered with the state to date, though a moratorium on new storefront openings is in place until the end of June.

Earlier this year, the Ohio House passed a new version of the Internet cafe legislation that would ban cash payouts or merchandise prizes worth more than $10, with additional language added to ensure other businesses could continue to offer sweepstakes contests.

DeWine and other supporters have said the legislation would effectively shutter the bulk of the sweepstakes parlors currently operating in the state and stop unregulated gambling and potential illicit activities that sometimes come with such establishments.

But parlor owners and some other lawmakers have countered that the proposed law changes would hurt legitimate businesses and cost the state thousands of jobs.

Mahoning County Prosecutor Paul Gains, who was at Wednesday’s briefing in Columbus, said he has taken a wait-and-see approach to the issue, hoping for either lawmaker action or a definitive court decision.

“It would really be nice if the Legislature would give us some guidance,” he said, adding, “If you’re dealing with cash, and apparently [sweepstakes parlors] are, and they’re unregulated, and that’s the biggest concern,” he said. “The potential for other crimes? Absolutely — money laundering, we don’t know where the proceeds are going. ... A lot of these funds are going out of the state and out of the country.”

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