The key players behind a purported veterans charity accused of setting up illegal gambling rooms pumped more than $1 million into the campaign accounts of politicians who had the power to regulate or put them out of business.
As the untaxed, barely regulated industry mushroomed into a billion-dollar industry, money went to the campaigns of governors in Florida and North Carolina as well as dozens of state legislators, and state political parties.
“They certainly were involved in the process; there’s no doubt about that,” said Florida House Speaker Will Weatherford, who himself received a $500 check from one of the companies involved.
An Associated Press review of contributions showed nearly $1.1 million went into Florida campaign accounts from 2009-12 and more than $150,000 in North Carolina.
Allied Veterans of the World ran nearly 50 Internet parlors in Florida with computerized slot- machine-style games and gave $6 million to veterans out of nearly $300 million in profits. Investigators said much of the money went to charity leaders, who spent much of it on luxury homes and vehicles.
The operations were shut down this week and nearly 60 people were arrested. Jennifer Carroll, Florida’s Republican lieutenant governor, abruptly resigned after being questioned by investigators. Carroll did consulting work for Allied Veterans while she was a state legislator. She was not charged with wrongdoing.
Undercover law-enforcement agents fanned out in the beginning of 2012 to conduct undercover investigations of 44 Allied Veterans locations, according to an Internal Revenue Service affidavit filed in federal court.
The agents labeled the parlors “Internet casinos,” saying employees urged them to pay more to gamble to win the biggest prizes. According to the IRS, that violates a Florida law saying any sweepstakes game couldn’t have different levels of prizes for those who made donations and those who did not.
A review of Florida contribution records showed several people arrested donated to state politicians, as did the Oklahoma-based software company that worked with Allied.