For those who don't believe casinos generate more crime, take a look at New Jersey - where the Casino Commission requires five divisions, each with a staff:

• The Commissioner's office
• the General Counsel's office
• Administration
• Financial Evaluation
• Licensing
• Compliance

The NJ Attorney General's office requires it's own Division of Gaming Enforcement.

And the New Jersey State Police maintains a separate Special Investigation Section which includes a separate unit for

• Casino Investigations
• Special Investigations
• Financial Crimes Investigation
• Casino Services

The reality is that creating a whole new bureaucracy isn't cheap. A brand new government bureaucracy will be necessary to audit, regulate, inspect and oversee casinos - to the tune of $20 million, or higher. Hundreds of government employees will be necessary to ensure compliance with regulations regarding money laundering, wiretapping and loan sharking.

Ka-ching.

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In her testimony before a Senate Hearing on June 29, 2009, Attorney General Martha Coakley presented wide ranging issues that demand public discussion to ensure transparency and integrity inherent in consideration of expanded gambling should the legislature determine to legalize additional forms of gambling based on claims expanded gambling will generate economic growth, jobs and revenue for the Commonwealth.

From the Attorney General's Testimony:

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Costs and resources
All of these structures, oversight mechanisms, and law enforcement and public health considerations will cost money both in the start-up phase and on an annual maintenance basis. It is crucial to accurately estimate costs of operating a gaming regulatory entity and a licensing regime, and of overseeing gaming operations, investigating and prosecuting gaming violations, and protecting public health. There may be unanticipated cost associated with larger investigations that may require additional funds and personnel, and the gaming commission should be able to charge or assess the unexpected additional costs back to the gaming licensee.

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The legislature needs to determine the framework, structure, ethical considerations and compensation for a Regulatory body, such as a Gaming Commission. Of necessity, ethical requirements, as well as staffing and physical office space costs need to be anticipated.

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Hackocracy?

Closer to home, it's hardly clear if our far-seeing lawmakers on Beacon Hill have fully explored how to regulate what overnight would become one of the Bay State's largest industries - one awash with cash and temptation.

The danger here is that we could wind up with a good, old fashioned, Massachusetts-style hackocracy, packed with patronage hires who couldn't care less about doing background checks on gambling operators.

Maybe I'm too cynical. But given our state's dubious reputation in such matters, you'll have to convince me otherwise.

-- Don't Bring Keystone Kops Routine To Mass
Banker and Tradesman Magazine, March 1, 2010

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In New Jersey's approximately 500 employees in the Attorney General's Office monitor day-to-day operations on a 24-hour-a-day basis.

Read this letter from a Connecticut Parole Officer,
with 20 years of on the job, who has "been a direct witness" to the additional burden that higher crime rates resulting from the two casinos have placed on the prison system and police services.

A mechanism and structure needs to be established for independent financial audits. The funding source needs to be defined and guaranteed.

Rules regarding clientele require staffing to review and monitor to ensure proper implementation. The funding source needs to be defined and guaranteed.

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Pennsylvania regulators, after a supposedly thorough background check, dutifully doled out a gambling license to a local businessman, only to find out he was under investigation for being a little too friendly with local mobsters. Not long after, the Gaming Control Board came under fire for clearing contractors with criminal records to work on projects at various gambling venues.

Topping it all off was an extravagant junket to Rome by board members of the supposed industry watchdog, piling up tens of thousands of dollars at the city's finest hotels, poolside service and all.

-- Don't Bring Keystone Kops Routine To Mass
Banker and Tradesman Magazine, March 1, 2010

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Adequate investigatory and enforcement resources must be guaranteed to assure public confidence.

The legislature must address issues of crime and jurisdiction beyond the current proposals. Funding needs to be guaranteed.

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In Ohio and Dearborn County, crime has escalated to the point that they have had to add an additional court to their county court system, and their jail has now become extremely overcrowded. The statistics that they have provided is that their misdemeanor caseload has grown by 200% since the riverboats came to town, and their felony caseload has tripled. They are also concerned because gambling has brought a dangerous criminal element to their community. The second largest oxycontin dealer in Kentucky is regularly transacting in their casino, and again the issue with children being unattended in the parking lot. They have had an increase in identity theft, counterfeiting, forgery, and fraud cases. They also now have a large massage parlor industry and prostitution has been attracted to the area because of the riverboat gambling. This is of concern as we have pretty much eradicated massage parlor prostitution from our community and I would certainly hate to see the resurgence of that criminal element here in Fort Wayne.

--Indiana State Prosecutor Karen Richards
In a letter to the Mayor of Fort Wayne
describing her conversations with prosecutors in casino communities

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Problem gambling measure pushed
By BRENDAN RILEY - Associated Press Writer

CARSON CITY, Nev. -- A measure that would expand efforts to help problem gamblers has been endorsed by judges, counselors and a Las Vegas lawyer who stole nearly $400,000 from clients to support his gambling addiction. Douglas Crawford, recently suspended from law practice by the state Supreme Court, told the Assembly Judiciary Committee on Friday that he was "uniquely qualified" to endorse AB102, creating a specialized court for problem gamblers.

The Judiciary Committee also was asked to raise the fees for filing court documents to help pay for nine new district judgeships in Clark County, bringing the total there to 52, and one new judgeship in Washoe County, raising its total to 15. Jeff Wells, assistant Clark County manager, said that under AB64 nine judges would be added in his county at a cost $28 million. The cost for the Washoe County judgeship would be about $1.2 million. Those who want to fill the new positions would have to run in the 2010 elections.

A companion bill, AB65, calls for a $99 increase in the cost of filing a lawsuit; $1,359 for filing a suit involving business; $349 for a class-action suit and $200 for filing a motion for summary judgment. The fees would be in addition to current fees. The bill also gives county commissions the authority to impose an additional $20 fee for filing a civil suit. AB64 and AB65 also were endorsed by Chief Justice Jim Hardesty.

Read more...

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The Troubling Case of the Revolving Door Effect

The gambling industry has worked diligently to repackage itself as harmless, wholesome entertainment. One key component in this marketing strategy is the portrayal of gambling as a heavily regulated (and thus "clean") industry.

However, the often-cozy relationship that exists between the gambling industry and gambling regulatory bodies calls into question the effectiveness of such oversight. In fact, a "revolving door" of sorts exists within the regulatory agencies; many regulators "cash in" on their experience by turning around and working for the industry they formerly regulated.

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