Friday, March 28, 2008
Reputed mob boss likely turning state's evidence in Slotsylvania
I've long dreaded this weird, but important moment in Slotsylvania history - and I'm not talking about the nation's temporary focus on this state for the heated Democratic primary in the U.S. presidential race.Reputed Northeastern Pennsylvania mob boss Billy D'Elia pleaded guilty today to just one count of money laundering conspiracy and one count of witness tampering. He had been facing nearly two dozen counts as a result of a federal investigation.
D'Elia, 61, was charged in May 2006 with laundering hundreds of thousands of dollars in drug proceeds and five months later additional charges were added after he tried to have a witness in the case killed.
His attorney, James Swetz, declined to tell the Associated Press whether there was a plea agreement or whether D'Elia agreed to cooperate in other cases.
However, D'Elia has testified once already, in front of a Dauphin County grand jury last year. It then recommended perjury charges against Mount Airy Casino Resort owner Louis DeNaples and took the unusual step of asking for reforms to the state's slots gambling system.
The DeNaples case is beginning to rock Slotsylvania to its political core, leading some Republican state lawmakers to call for a special bipartisan committee with subpoena power to investigate his licensing.
The Dunmore billionaire and former federal felon reportedly gave more than $1.1 million to the state's top politicians - including at least $115,000 to Gov. Ed Rendell, at least $35,000 to state Attorney General Tom Corbett and hundreds of thousands more to key lawmakers and party groups on both sides of the aisle, including some publicly opposed to slot machines - to get slots gambling legalized in 2004 and to buy enough influence to get his own license two years later.Asked by the Scranton Times-Tribune in 2006 why he gave so many campaign contributions to the state's top brass, the landfill owner, banker and auto parts dealer replied, "It's more like building a customer base and spreading goodwill. It's business."
To date, the governor and the state's top prosecutor have publicly refused to return DeNaples' money, saying through their government-hired spokesmen that DeNaples is innocent until proven guilty.
Meanwhile, DeNaples spent $67,375 last year on lobbyists to sway lawmakers into passing a bill to turn the state's 14 slots parlors into full fledged casinos. That bill, H.B. 2121, was written by House Majority Leader H. William DeWeese but has been stuck in the Gaming Oversight Committee for more than a year.
Corbett and his seven-attorney government corruption unit are not prosecuting DeNaples. Instead, Corbett says he let Dauphin County District Attorney Ed Marisco do it.
DeNaples, 67, has long been rumored to have had mob connections, and was even cited in a report of the now-defunct Pennsylvania Crime Commission. He has denied any wrong doing.
DeNaples has hired high-priced lawyers and a spokesman with ties to the governor to defend him. They've launched a public smear campaign with lead defense attorney, Richard Sprague of Philadelphia, citing grand jury leaks to the media as proof Marsico is headline grabbing. The county prosecutor denies the assertion.
Swetz, D'Elia's attorney, has previously said his client would have been willing to testify before the Gaming Control Board before DeNaples was licensed, but was never subpoenaed.
Former control board chairman Tad Decker, a college buddy of Gov. Rendell who appointed him, has said he was told D'Elia would refuse to cooperate if called, but refused to say who told him.Decker has also publicly denied testimony from state police Commissioner Jeffrey Miller that he knew or should have known state police were investigating DeNaples for perjury before the Gaming Control Board voted unanimously to grant him a license on Dec. 20, 2006.
Decker's old law firm, Cozen O'Connor, which he has since returned to head, was subsequently hired by DeNaples to handle the financing of his slots parlor.
DeNaples was indicted Jan. 30, 2008, three months after opening his $412 million slots parlor at the site of the former Mount Airy Lodge, a once-famous lover's resort. The Gaming Control Board has since barred DeNaples from his own casino and his share of its proceeds until the charges are resolved.
The grand jury found DeNaples lied to the control board behind closed doors about his relationship with D'Elia; D'Elia's former boss, the late mafia don Russell Bufalino; and two corrupt political fixers in Philadelphia, based partly upon D'Elia's testimony and federal wiretaps.
D'Elia is said to be a mediator among mob families. The Feds say he met frequently with Philadelphia mobsters and had frequent contacts with western Pennsylvania and New York families.
DeNaples told the Gaming Control Board that he and D'Elia were merely acquaintances. But D'Elia told the grand jury they've been long-time friends, even to the point where DeNaples attended his daughter's wedding.
Attorneys for DeNaples dispute D'Elia's assertion, claiming he lied to the grand jury. As proof, Sprague has cited D'Elia's claim that DeNaples gave him his late father's rosary beads as a symbol of their friendship. The beads were buried with the elder DeNaples, Sprague told the Philadelphia Inquirer.
DeNaples' spokesman, Kevin Feeley, on Friday accused prosecutors of giving D'Elia a sweetheart deal in exchange for his testimony against DeNaples.
"It's clear to us that he's getting a deal to cooperate because he's the foundation of their case," Feeley said. "It is stunning that the government would agree to give a deal to a guy who allegedly tried to murder a witness."
Feeley also called D'Elia a liar. "It's clear he's willing to say anything if it helps him get a deal."
U.S. Attorney Martin Carlson declined to respond to Feeley's accusations Friday, issuing a press release that thanked state and federal law enforcement officials but said little about D'Elia's plea. He cited "sealing orders" entered by the court as his reason.
DeNaples' perjury case has yet to be scheduled for trial. His attorneys have asked the state Supreme Court to intervene, arguing Marsico overstepped his authority and the grand jury that issued the indictment was not properly empanelled.
D'Elia will be sentenced in June, when we may find out what, if any, deal he cut. He now faces up to 30 years in prison and a $750,000 fine.
On DeNaples' legal team, but away from the criminal case involving DeNaples, are four former federal prosecutors.
One of them is former Assistant U.S. Attorney Sal Cognetti Jr., who successfully prosecuted DeNaples for a government fraud conspiracy 30 years ago. He is now defending DeNaples' friend, the Rev. Joseph Sica, who also faces perjury charges. The grand jury claimed the Scranton priest lied to them about DeNaples' mob ties.
DeNaples also hired former U.S. Attorney Tom Marino, Carlson's predecessor. who was supposed to be building a federal case against DeNaples in 2006 when he secretedly vouched for his good character as a law enforcement reference on DeNaples' slots parlor license.Marino recused himself from the federal probe when word of his support of DeNaples leaked last year. He later resigned to take a job as DeNaples' in-house counsel.
DeNaples also hired Peter Vaira, a former U.S. attorney in Philadelphia, and J. Alan Johnson, a former U.S. attorney in Pittsburgh, to assure the control board that DeNaples had no relationships with organized crime figures.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here. For more about Billy D'Elia, click here.
Labels: Bill DeWeese, Billy D'Elia, casino, Ed Rendell, Jeffrey Miller, Louis DeNaples, Pennsylvania, slots, Tad Decker, Tom Corbett
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Wednesday, March 26, 2008
Spinning the wheels of injustice in Slotsylvania
I couldn't resist writing that headline after reading today's editorial in the Towanda Daily Review, which calls Pennsylvania's slots parlor licensing system "a game of chance in terms of reliability and integrity" because of the Louis DeNaples mess."The scandalous failure of several state agencies to cooperate, as the Gaming Control Board considered Dunmore businessman Louis DeNaples' application to operate the Mount Airy Casino Resort, must be the last such breach of the public trust."
I'll go that paper one step further and say it should never have happened in the first place.
It wouldn't have, had state law had prevented the billionaire from buying more than $1.1 million worth of influence among the state's top politicians despite his admitted federal felony in 1978.
Gov. Ed Rendell accepted at least $115,000 and state Attorney General Tom Corbett took at least $35,000 from DeNaples in campaign contributions. Neither will give it back now that DeNaples has been indicted for perjury.
A Dauphin County grand jury found he lied to the state Gaming Control Board during his closed-door licensing hearing about his relationship with two reputed mob bosses and two corrupt political fixers. DeNaples has denied any wrongdoing, but has been barred from his own casino pending the outcome of the criminal case.
Republican lawmakers, who are in the minority in the state House, have started a call for reforming the state's four-year-old law legalizing slot machine gambling. They also want a bipartisan committee to investigate DeNaples' licensing.
However, the bill to create that committee, House Resolution 652, still isn't posted online for the public to read. Is it any wonder that the Republicans are also decrying largely partisan efforts to block them?
"For all the grousing by lawmakers about the regulatory failure, they are responsible for creating a structure that compromised the independence of the investigative machinery responsible for licensing investigations and, potentially, of board members themselves," the Daily Review's editorial says.
I couldn't agree more.
Legalized gambling was a major change in Pennsylvania and should have been put to the voters in the form of a referendum. Instead, it was snuck into existence by gutting an existing bill and then ramrodded through the Legislature in the middle of the night on the eve of a July 4 holiday recess.
The newspaper also says, "Reforms now will be crucial not only regarding the determination of licenses for the remaining slots parlors authorized by the law, but for the inevitable future expansion of the gambling industry."
I dispute the inevitability of further gambling expansion.
Although House Bill 2121 is already pending to turn the 14 slots parlors - seven of which are already operating - into full casinos, Slotsylvania has yet to provide statewide property tax reductions for all homeowners, much less real tax reform.
Funding those tax cuts was the alleged public good behind slot machine gambling in the first place. Just because our lawmakers spend like drunken sailors and are now addicted to this revenue stream doesn't mean we should further feed their addiction. That's how New Jersey landed in budget trouble despite 30 years of gambling in Atlantic City.
Yet, even as America teeters on the edge of a recession, Pennsylvania's slots parlors continue to reap big profits. "What does this tell us?" state Rep. Paul Clymer (R-Bucks County) wrote in a letter to the editors of multiple newspapers today.
"It tells me that the path to addiction has a stronger hold on recreational gamblers than previously thought, because even though more and more people are carpooling, dining in and forgoing luxury vacations in an effort to save money, they are still spending money on the one-armed bandits."
The letter from Clymer, the minority chairman of the House Gaming Oversight Committee, also calls for passage of his own bill, H.B. 783. It would require "each licensed gaming entity that offers patrons total rewards cards that track the amount of money and time spent gaming in order to determine the value of provisions or complimentary services to their patrons issue monthly statements that list patrons' gaming winnings and losses."
Clymer's bill has been stuck in his own committee for more than a year now. In fact, the oversight committee hasn't passed a single slots reform bill in that time under Chairman Harold James (D-Philadelphia).
"I encourage all citizens, as we face a sluggish economy and rising unemployment rates, to be smart about their finances and stick to a budget when it comes to recreational expenses," Clymer wrote. "Your money is better spent elsewhere than at a multi-billion dollar casino that has the odds in its favor...."
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Louis DeNaples, Paul Clymer, Pennsylvania, slots
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Monday, March 24, 2008
Pressure building in Slotsylvania House for DeNaples probe
"It seems like we're not getting the truth here," state Rep. Curt Schroder (R-East Brandywine) told the Daily Local News of Chester County last week.
That's why Shroder and other Republican lawmakers are throwing in behind House Resolution 652. It reportedly calls for creating a select committee with subpoena powers to to examine the process that awarded a state license to indicted slots parlor owner Louis DeNaples.
I'd love to link directly to the resolution and tell you all about it.
But in typical Slotsylvania fashion, HR 652 still isn't posted online for the public to read. It isn't among a list of pending resolutions even though 12 others have been added since it was introduced last week.
That isn't what's supposed to happen when something controversial gets introduced in the Legislature. Just look at this example, which also happens to reference a fictional House Bill 652.
If passed by the House, HR 652 would reportedly create a select committee composed of 10 members, including the majority and minority chairs of the Gaming Oversight Committee, two appointments each from the majority and minority leaders, and four appointments by the speaker - two Republicans and two Democrats.
The committee would hold hearings, take testimony and issue subpoenas to compel testimony or produce documents, records or other information deemed appropriate.
Any person appearing before the committee would be put under oath or affirmation. Any person refusing to testify or produce requested records would be subject to penalties. The committee would have 90 days to complete its work.
That work is includes figuring who was telling the truth: State Police Commissioner Jeffrey B. Miller, who testified on March 4 that the state Gaming Control Board knew or should have known DeNaples was under investigation for perjury before he was granted a license, or former Control Board Chairman Thomas "Tad" Decker who has publicly stated they didn't.
The board unanimously approved a license for DeNaples on Dec. 20, 2006, ignoring DeNaples' near-three-decades old felony, a complaint that he sold a Hurricane Katrina-wrecked tractor trailer for hauling instead of scrap as well as his rumored ties to mob figures.
DeNaples was indicted Jan. 30 on four charges of lying to the gaming board about his relationship with two reputed Northeastern Pennsylvania mob bosses and two corrupt political fixers in Philadelphia.
He has denied any wrong-doing, but has been barred from his own $412 million Mount Airy Casino and its profits.
"I think we have to get to the bottom of this," said Shroder, a member of the House Gaming Oversight Committee. We can't just say, 'Oh, we'll do better next time.' We really have to restore the public's confidence in this whole operation."
Shroder could start by asking state Rep. Harold James (D-Philadelphia), the majority chairman of the oversight committee, why he hasn't called for hearings himself. Or ask James why the committee hasn't moved a single slots gambling reform bill in more than a year.
Ditto for state Sen. Jane Earll, an Erie Republican who heads the Senate Community, Economic and Recreational Development Committee and has similarly stymied reform efforts there.
Earll also stopped an effort last October to put state police in charge of slot licensee background investigations, saying, "I don't see any glaring problems that have been brought to light by today's testimony that we need to rush to fix."
As The Citizens Voice of Wilkes-Barre said in its editorial on Sunday, "Finding the truth is a matter of accountability to the public."
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Harold James, Jane Earll, Jeffrey Miller, Louis DeNaples, Pennsylvania, slots, Tad Decker
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Saturday, March 22, 2008
DeNaples fights back; key lawmaker in trouble in Slotsylvania
Now it's indicted slots parlor owner Louis DeNaples' turn to fight back.On Thursday, the Dunmore billionaire gave a copy of his own FBI file to the state Gaming Control Board. He initially refused to do that during the background check for his license, even though he requested it through the Federal Freedom of Information Act.
Kevin Feeley, DeNaples' spokesman, blamed the discrepancy on the FBI's failure to release the entire file to DeNaples in a timely manner. Since then, the FBI has supplied the entire file to DeNaples' attorneys, Feeley said. In response to a recent request from the gaming board, the lawyers gave it to the agency.
DeNaples' lawyer, Richard A. Sprague of Philadelphia, told the Inquirer the perjury case against his client rests on lies told by reputed Northeastern Pennsylvania mob boss Billy D'Elia.
Sprague said D'Elia lied when he told the grand jury that the D'Elia-DeNaples family relationship ran so deep that DeNaples gave his father's rosary beads to D'Elia after the elder DeNaples passed away. The rosary beads were black, not green, and are buried with the elder DeNaples, Sprague told the newspaper's editorial board.
Sprague also attacked D'Elia's testimony cited in the grand jury's Jan. 30 presentment that D'Elia's predecessor, the late Russell Bufalino, gave DeNaples the ring he was wearing after DeNaples complimented it while the pair were at the C&C Club in the early 1970s.
It never happened, said Sprague, who had asked to meet with the Inquirer's editorial board to complain about the way the newspaper's editorials had characterized DeNaples, who maintains his innocence. He has been barred from his own casino - and its profits - pending the outcome of the criminal case.
State police filed the four perjury charges against DeNaples, 67, accusing him of lying to Gaming Control Board agents about the extent of his relationships with D'Elia, Bufalino and two men at the center of a federal probe into corruption involving Philadelphia City Hall.
And before you go thinking DeNaples' was framed, remember he pleaded no contest to a federal felony in a 1978 fraud case, gave more than $1.1 million to the state's top elected officials in the years before he received his license, and FBI wiretaps are being used as evidence against him.
None of that also explains whether DeNaples attended the 1999 wedding of D'Elia's daughter, as D'Elia has also claimed. Stands to reason that if there was no friendly connection between the two of them, DeNaples might just have sent a gift and well wishes.
Better hope the feds, state police and/or Dauphin County prosecutors are going through the wedding album right now looking for DeNaples in group shots.
Nor does it explain why Tad Decker, the former chairman of the gaming board, refused to call D'Elia as a witness before the board unanimously voted to grant him a license on Dec. 20, 2006.
Decker told the Allentown Morning Call that someone - he refused to say who - told him that D'Elia would merely have evoked his fifth amendment rights against self-incrimination if called. It wasn't D'Elia's lawyer, who said his client is eager to testify on this matter.
Decker and other Gaming Control Board members knew or should have known that the state police were investigating DeNaples for perjury before they issued him a license, according to testimony state police commander Jeffrey Miller gave the Legislature during budget hearings last month.
Since then, you can understand why Republicans in the Legislature are salivating for an official probe into DeNaples' licensing by a bipartisan committee with subpoena power. They also want reform for the state's four-year-old slots law.
One of the biggest impediments to slots reform, though, has been state Rep. Harold James (D-Philadelphia), majority chairman of the House Gaming Oversight Committee. He has refused to move any slots-related legislation out of his committee for more than a year.
But the wheels in Slotsylvania go round and round - and James may now be hardpressed to win re-election this year.
According to the Inquirer: The state Supreme Court issued a three-sentence order Thursday overturning a ruling by Commonwealth Court Judge Doris A. Smith-Ribner and ordered her to consider a challenge against James's nominating petitions, seeking to have him thrown off the April 22 primary ballot.The original deadline for submitting signatures was Feb. 12, and the deadline for challenging them was seven days later.
But a raging snowstorm in central Pennsylvania kept some candidates from reaching the state election bureau in time, and Gov. Rendell extended the filing deadline from 5 p.m. on Feb. 12 to noon on Feb. 14. Challenges were due seven days later.
James's opponent, Kenyatta Johnson, challenged James's petitions on grounds that he improperly listed himself as the person circulating his petitions, when in fact they were circulated by other people.
Johnson filed the challenge in mid-afternoon on Feb. 21. James's attorney, John Sabatina, contended that the challenge should have been filed before noon. Ribner-Smith agreed and dismissed the challenge, without hearing any of Johnson's evidence on the alleged petition problems.
The Supreme Court disagreed, ruling yesterday that the challenge had been "timely filed" and remanding the James case for a hearing next Wednesday.
There is no known direct connection between DeNaples and state Rep. James.
However, one of James' biggest political contributors over the years was former state Rep. Mike Veon, who gave him a total of $5,000. Although Veon is now a lobbyist in Harrisburg for gambling and other interests, as a lawmaker he received at least $60,000 in contributions from DeNaples.
Veon also was head of the House Democratic Campaign Committee and used that position to push for gambling expansion along with now-House Majority Leader H. William DeWeese, who reportedly received $5,000 in contributions from DeNaples.
James' committee is sitting on a bill DeWeese wrote, H.B. 2121, which would turn all of the state's 14 slots parlors - seven of which are already operating - into full fledged casinos.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: Bill DeWeese, Billy D'Elia, casino, Harold James, Louis DeNaples, Mike Veon, Pennsylvania, slots
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Friday, March 14, 2008
Thy casinos' will be done, thy kingdom come in Slotsylvania?
FOLLOW UP FRIDAY - Pennsylvania's casinos are likely spending their easily-earned lobbying money right now battling a proposed statewide ban on indoor smoking. But good luck trying to prove it.The state's online database of lobbying expenditures doesn't allow you to search by the subject of what is being lobbyed for or against.
Nor do the lobbyists have to spell out who they gave gifts to, just their basic purpose and who their clients are. Sometimes, the lobbyists even ignore doing that.
The state's lobbying disclosure law doesn't require immediate disclosure either, just a quarterly expense report if the lobbyist spent more than $2,500. The next reports, covering Jan. 1 to March 31, aren't due until April 30th.
Meanwhile, state lawmakers and other officials don't have to file their annual statements of financial interests - reports spelling out what gifts they've received and what conflicts of interest they've had - until May 1.
By then, the indoor smoking ban debate may be over.
Even an annual report to the General Assembly outlining lobbying activities in 2007 with detailed information on registered principals, lobbying firms and lobbyists has not been posted online for the public to read.
And everyone in Slotsylvania simply shrugs and accepts it.
Is it any wonder Gov. Ed Rendell and state Attorney General Tom Corbett feel safe in refusing to give back denotions from a slots parlor owner who has since been indicted for lying about his mob ties?
Can't anyone in Harrisburg say pay-to-play?
I do know, thanks to my own research, that the casino companies spent at least $2.6 million last year to lobby the Legislature and Rendell's administration.
And I suspect lots of lobbying is going on right now because the slots parlors want a special state exemption from a proposed indoor smoking ban - even as Senate Bill 246 is being re-crafted by a panel of lawmakers as a compromise between competing bills that passed in the House and Senate last year.
Other gambling states such as New Jersey and Connecticut are pondering outright smoking bans in their casinos.
Their reason? Atlantic City baccarat dealer Kam Wong was awarded about $150,000 as disability pay and lost wages last month as worker's compensation - and additional amounts for future medical care - for the lung cancer she developed after 10 years of breathing secondhand smoke at the former Claridge Casino Hotel.
But during testimony before the state House and Senate conference committee on Thursday, casino owners pointed to dips in slot machine revenues at Delaware casinos after that state went smoke-free. Those casinos only recovered after they expanded to 24 hours of operation and added machines.
"The baseline went down 20 percent, and it's taken six years to get back," said David Jonas, president of Philadelphia Park Casino. If that happens here, the Legislature's goal of homeowner property tax cuts would be undermined, he and his industry colleagues said.
State Rep. Mike Gerber, a champion of a law with as few exceptions as possible, countered by accusing casino owners of "asking us to put your profits before the health of your workers and your patrons."
But Jonas also argued, "We understand the health hazards of direct smoking and the concerns expressed about secondhand smoke. A blanket smoking ban on casinos would be a disaster for the industry. ... You cannot burden the casino industry with an unnecessary obstacle to providing the revenue that you need [for property tax relief]."
Committee Chairman Stewart Greenleaf (R-Montgomery) said the committee will begin its final deliberations at a public meeting scheduled for April 1.
Meanwhile, Quakertown - one of the largest towns in Greenleaf's district - last week became the latest of a growing number of municipalities across the state to locally ban smoking outdoors in their parks. Anyone caught lighting a pipe, cigar or cigarette faces a fine of up to $600 or 30 days in jail.
Labels: casino, lobbying, Pennsylvania, slots, smoking
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Sunday, March 09, 2008
Something stinks in Slotsylvania
The Pittsburgh Tribune-Review is now calling on state Attorney General Tom Corbett to conduct "a thorough investigation" into whether it was the state police or the Pennsylvania Gaming Control Board that screwed up before Louis DeNaples was issued a slots parlor license."Everybody's pointing fingers at everybody else. But, clearly, the truth is not being served," the newspaper's Saturday editorial says.
I doubt the truth would be served if Corbett did launch a probe with his unproven seven-attorney gambling corruption unit.
That's because Corbett accepted at least $35,000 in campaign contributions from DeNaples, a Dunmore billionaire and admitted felon who now stands accused of perjury for lying about his alleged ties to two reputed mobsters and two political fixers.
Corbett, who is up for re-election this year, has "no plans to give the money back," his spokesman, Kevin Harley, told the Harrisburg Patriot News little more than a week ago.
Pressure is beginning to build, though, on him, Gov. Ed Rendell, state lawmakers and judges to give back the $1.1 million DeNaples gave their campaigns until he got his slots parlor license, according to the Tribune-Review.
My research says DeNaples contributed at least $679,335. The Scranton Times-Tribune puts DeNaples' contributions at $1,002,950.
"There was never anything hidden about" the contributions, DeNaples' spokesman Kevin Feeley told the Tribune-Review. "They were ... recorded under the proper campaign election law guidelines. They are perfectly legitimate."
They were also recorded shoddily by high-ranking state officials, the Department of State or both. For instance, newspapers often quote the amount of DeNaples' money that went to Corbett as $25,000.
However, a $10,000 donation by D&L Realty, one of DeNaples' many companies, to Friends of Tom Corbett on Jan. 27, 2004 does not appear in the state's online contribution database. It does, however, show up in that campaign committee's finance report with no mention in subsequent reports of the money being returned.
"There's only one good rule," Larry Sabato, a political science professor at the University of Virginia, told the Tribune-Review, "Return the money by certified mail, immediately."
But Harley insists Corbett won't return the cash, nor will he recuse himself from any investigations involving DeNaples. "If an issue came up ... we would investigate it," he told the Tribune-Review.
Corbett has denied a conflict of interest exists and said he opted to let Dauphin County District Attorney Ed Marsico pursue the perjury case against DeNaples because he had already prosecuted a couple of slots parlor applicants who illegally gave contributions after the state passed the law legalizing slot machines in 2004. They each received civil fines.
Corbett has a seven-lawyer corruption unit, which was established with slots gambling in mind. But it has yet to prosecute a single casino-related corruption case in two years.
Yet, Corbett said on Feb. 28, 2006, "By creating a Public Corruption Unit, the Attorney General's Office is putting a spotlight on investigating and prosecuting public corruption cases at a crucial time in our state's history when slot machines and casino gaming is about to become reality."
By the way, the Feds were also interested in DeNaples. But while his office was probing DeNaples, Tom Marino, the U.S. Attorney for Central Pennsylvania, was one of two legal references that DeNaples used on his slots parlor application. Marino recused himself when the information leaked publicly, resigned his office and now works directly for DeNaples.
Former Allegheny County Chief Executive Jim Roddey summed the situation up nicely in the Tribune-Review, "To have contributions going to people who could have an influence on a license and have the gaming board ignore all signs along the way just stinks."
State Sen. Jake Corman told the newspaper that Corbett should probe, if necessary, but first Corman wants the state Senate to take a whack at finding out if either the state police or Gaming Control Board was being untruthful in testimony before the Senate Appropriations Committee about DeNaples.
"At a minimum someone has not been honest with this committee," said Corman, a Centre County Republican. "Someone made a decision to turn a blind eye on this DeNaples matter."
Sen. John Rafferty, whose Law & Justice Committee oversees the state police, is planning a hearing. He wants to do it with Sen. Jane Earll, R-Erie, who chairs a gambling oversight panel. Rafferty, R-Chester County, is viewed as pro state police. Earll, who has a casino in her district, is viewed as pro-gaming.
Earll stopped an effort last October to put state police in charge of slot licensee background investigations, saying, "I don't see any glaring problems that have been brought to light by today's testimony that we need to rush to fix."
She also has not let any slots reform legislation out of her committee in more than a year now.
It shouldn't be such a shock considering lawmakers are still being lobbied hard by the gambling industry - to the tune of at least $2.6 million last year, my research shows.
That includes the parent company of DeNaples' slots parlor, Mount Airy #1 L.L.C, which spent $67,375 lobbying lawmakers for "casino gambling" through the Philadelphia firm of S.R. Wojdak & Associates LP.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, gambling, Louis DeNaples, Pennsylvania, slots, Tom Corbett
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Friday, March 07, 2008
Some things I still don't understand in Slotsylvania
FOLLOW UP FRIDAY - Has indicted slots parlor owner Louis DeNaples ever faced an opposing lawyer or prosecutor he didn't hire?He hired Sal Cognetti Jr., a former assistant U.S. attorney who prosecuted DeNaples sucessfully in 1978 on a charge that he defrauded the federal government of $525,000 for cleanup work associated with Hurricane Agnes. The Dunmore auto parts dealer, landfill owner and banker pleaded no contest to a felony conspiracy count, paid a $10,000 fine and spent three years on probation.
Cognetti is now defending the Rev. Joseph Sica, who has been charged with perjury for lying to a Dauphin County grand jury that later indicted DeNaples for perjury. The grand jury believed the Dunmore billionaire lied to the Pennsylvania Gaming Control Board about his ties to reputed mobsters and political fixers.
Cognetti was also one of two law enforcement references DeNaples used on his successful slots parlor application. "You judge a man by his whole life, not something that happened 30 years ago and I think when you judge Mr. DeNaples by his whole life, he is an honorable person," Cognetti told reporters then.
The other reference came from U.S. Attorney Thomas Marino, who was supposed to be building up a federal case against DeNaples even as he secretly supported the suspect's bid for a casino.
He left office last October and was hired as DeNaples' in-house counsel two months later.
Former Gaming Control Board Chairman Thomas "Tad" Decker was supposed to be weighing the public acceptability of DeNaples' license, but the board did most of its work behind closed doors under his reign and he seems to have disregarded any of the warning flags that were blowing at hurricane strength.
As soon as DeNaples got his license in 2006, one of the first things he did was hires Decker's former Philadelphia law firm, Cozen O'Connor, to handle the financing of his $412 million resort and casino. When Decker resigned from the PGCB last year, he immediately became CEO and President of Cozen O'Connor.
DeNaples also hired Peter Vaira, a former U.S. attorney in Philadelphia, and J. Alan Johnson, a former U.S. attorney in Pittsburgh, to assure the control board that DeNaples had no relationships with organized crime figures.
He never hired Attorney General Tom Corbett, but he did contribute $35,000 toward his election campaign and the state's top law enforcement officer now won't return it. Corbett opted to let Dauphin County District Attorney Ed Marsico prosecute DeNaples, instead of having his own seven-attorney slots corruption unit handle the case.
But given this track record, one can only wonder which honorable barrister is getting his resume together next?
It reminds me of what another felon, Bob Bolus Jr., an enemy of DeNaples and a competing auto parts dealer, testified to during a public hearing on DeNaples' license.
"DeNaples will lie, cheat and even allow someone to be imprisoned to get his own way," Bolus said. "Louis feels he can just buy anyone he wants."
I guess they have their uses s long as they have a law degree.
COMBATING ILLEGAL GAMBLING VS. TREATING GAMBLING ADDICTS
The Pennsylvania Gaming Control Board is handing out as much as $5 million to combat illegal slots and poker machines out of its 55 percent rake from legal slots parlors, even though some law enforcement officials are confused about how the money can be spent, according to the Pittsburgh Tribune-Review.
But they're not looking a gift horse in the mouth, either. For instance, the Washington County District Attorney's office received a state grant of more than $151,000 this week to establish an illegal slot machine task force so the state can defend its gambling monopoly.
However, there are already more than 200 Pennsylvanians so addicted to slot machine gambling that they've legally barred themselves from the seven operating casinos, with seven more parlors left to open, PGCB Chairwoman Mary DiGiacomo Colins testified to last month.
Yet, two bills that would require the PGCB to spend $1.5 million to $3.5 million on treatment for compulsive gamblers have been stuck in the House Committee on Gaming Oversight for more than a year.
And no offense to state Rep. Tom Creighton, but sending gamblers a monthly win-loss statement without providing additional means for them to seek help is just whitewashing over the social cost of legalized gambling.
MONEY AND LOBBYING TRUMPING PUBLIC REFORM EFFORTS
One thing I'll never understand, is why did the 2005 pay raise cause such a public outrage that it was later repealed, but no groundswell can seemingly beat back the 2004 slots law, which was similarly passed in the middle of the night on the eve of a holiday with no public debate or referendum?
And now even after the Legislature and Gov. Ed Rendell have reneged on the promise of using the extra $1 billion generated from slots for statewide property tax reform, one slots parlor owner has been indicted, and lobbyists are secretly spending at least $2.6 million to influence lawmakers, the public still isn't stirring.
What's it going to take? Will the public stay silent now that the state's estimate of $3 billion annually from the 14 slots parlors is expected to fall far short of projections while there's a bill waiting in the wings to expand the slots parlors into full fledge casinos?
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Ed Rendell, Louis DeNaples, Pennsylvania, slots, Tom Corbett
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Somebody else may be lying in Slotsylvania...
... And I don't think it's the state police commander.
Former Pennsylvania Gaming Control Board chairman Thomas A. "Tad" Decker is once again telling newspapers that his board did not know slots parlor applicant Louis DeNaples was lying to them before they issued him a license."We didn't send a perjury referral," Decker told Robert Swift, the Scranton Times-Tribune's Harrisburg reporter on Wednesday. "This is just flat out not true."
Decker may sound adamant in the newspaper, but his comments are the opposite of what State Police Commissioner Jeffrey B. Miller testified to this week during back-to-back hearings at the Capitol.
Miller, a colonel, testified Tuesday that at least some of the state's seven Gaming Board members knew the state police were investigating DeNaples for lying to them, but they publicly voted unanimously to award the politically-connected Dunmore billionaire a slots parlor license anyway on Dec. 20, 2006.
DeNaples was indicted by a Dauphin County grand jury on Jan. 30 for four perjury charges alleging he lied to the gaming board about his ties to two reputed mob bosses and two corrupt Philadelphia political fixers. He had denied any wrongdoing.
To be fair, Miller apparently used the word "apparently" in his testimony, according to a report by Brad Bumsted, the Pittsburgh Tribune-Review's capitol reporter.
Even with that slight hesitation, though, Miller said under oath that the board should have had enough warning flags to delay a decision on DeNaples' license - a conclusion I completely agree with.
I'll even go Miller a step further, to say if David Kwait and Thomas Sturgeon, the gaming regulators' privately-hired investigators, didn't tell their bosses that they tipped the state police to DeNaples' alleged perjury, then the PGCB really is an out-of-control board.
"The board should have known because the BIE (the gaming board's own privately hired Bureau of Investigation and Enforcement) did know, because they were the ones who referred it to us in the first place," Miller told senators.
However, Gaming Board member Raymond S. Angeli, the president of Lackawanna College in Scranton, told the Times-Tribune Wednesday he heard nothing about BIE criminal referrals or a state police perjury probe during the closed door hearings about DeNaples' license application.
"I don't ever remember anyone referring anything to us that would have been a concern," Angeli said. "They (BIE) gave us no indication they were referring anything to anybody at the time of licensure."
But they appear to have done just that.
In addition to tipping the state police and Central Pennsylvania U.S. Attorney Tom Marino (who now works for DeNaples) to the possible perjury, Miller testified that Kwait and Sturgeon also told troopers that DeNaples bought 30 tractor-trailers flooded by Hurricane Katrina in New Orleans for $180,000, and then allegedly sold at least one for illegal use on the open road for $75,000 rather than scrapping it. That investigation is still ongoing.
Decker has said the board opted to dismiss the truck allegation during closed door negotiations. The board referred the matter in fall 2006 to the Department of State, which later reported it "didn't have any proof there was anything illegal."
In a letter to the editor of The Philadelphia Inquirer on Feb. 14, Decker blamed the state police for failing to turn over a transcript of an FBI wiretap of DeNaples before he and the others unanimously approved his license. He also claimed it was the wiretap that triggered the perjury investigation.
Decker had an opportunity to clarify DeNaples' relationship with reputed mob boss Billy D'Elia by simply subpoenaeing D'Elia before the vote, but failed to do it.
Yet, he told the Philadelphia Daily News on Aug. 1, 2007, "We didn't find one scintilla of evidence that DeNaples had any issues."
On Tuesday, Miller testified in a 2008-09 budget hearing before the Senate Appropriations Committee, "Frankly, it is obvious even (former) chairman Tad Decker knew of the ongoing investigation."
Miller quoted from a letter Decker sent him on Dec. 18, 2006, which stated: "Your office may be in the possession of some important background information which may affect the suitability decision of the Pennsylvania Gaming Control Board with respect to an applicant for a (stand-alone casino)."
He then told lawmakers Decker "seemed to be in a hurry to grant that license (to DeNaples)."
Why would that be, I wonder?
Perhaps it's because Decker's old law firm, Cozen O'Connor, represents both DeNaples and HSP Gaming's SugarHouse Casino in Philly. Decker recused himself from SugarHouse's approval vote and O'Connor wasn't representing DeNaples during his application process. The firm was hired later to handle the financing of DeNaples' $400 million slots parlor. Meanwhile, Decker participated in all the PGCB deliberations and voted to approve DeNaples' license.
Decker was Cozen O'Connor's managing director before being hand-picked in 2004 to his $150,000 a year public post by his old college buddy, Gov. Ed Rendell. DeNaples contributed at least $115,000 toward Rendell's election campaign for governor in 2000, state records show.
Decker resigned as head of the gaming board on Aug. 8, 2007, and immediately returned to his old firm - this time as CEO and president.
Casino-Free Philadelphia, an anti-casino group, and Hallwatch.org, a good government Web site, subsequently questioned the cozy arrangement between Decker and Cozen O'Connor as a conflict of interest and a possible violation of Pennsylvania's Rules of Professional Conduct for licensed attorneys.
However, the state Supreme Court's Disciplinary Counsel dismissed their complaint. (By the way, supreme court Justice Ron Castille, a former Philly District Attorney, was Decker's law school roommate at the University of Virginia in 1971.)
Some of this may finally get sorted out soon at a hearing on the DeNaples licensing controversy before the state Senate Law and Justice Committee. The committee's chairman, Sen. John Rafferty (R-Chester) hopes to make the hearing a joint one with the Senate Community and Economic Development Committee chaired by Sen. Jane Earll, R-Erie.
Rafferty's committee has legislative oversight over the state police, while Earll's committee has oversight over the Gaming Board.
I won't hold my breath waiting, though. Earll has prevented any slots gambling reform legislation from coming to a vote in her committee for more than a year now.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Ed Rendell, Jeffrey Miller, Louis DeNaples, Pennsylvania, slots, Tad Decker
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Wednesday, March 05, 2008
Slotsylvania corruption a concern, but Rendell isn't blamed
Sixty five percent of Pennsylvania residents say property tax cuts are "not too likely" or "not likely at all" from the state's $1 billion windfall from slots parlors, a recent poll has found.Oh, most residents (71 percent) believe the state is "very likely" or "somewhat likely" to raise that much money annually from slot machine gambling by 2012. They simply don't think the added revenue will benefit them. according to a Quinnipiac University survey released last Thursday.
The university's Polling Institute surveyed 1,872 Pennsylvania voters from Feb. 21-25. Its results have a margin of error of +/- 2.3 percentage points.
Slot machines were supposed to be the linchpin for property tax reform in this state.
So far, the only ones to benefit, besides the slots parlor owners and the lawmakers they continue to lobby, have been low income seniors.
The Legislature and Gov. Ed Rendell have yet to approve a workable plan to reduce taxes for every homeowner even though half of the projected 14 slots parlors are already open.
Here's where things get a little weird.
"While Pennsylvania voters remain skeptical that slot machine gambling casino revenue will cut their taxes, the author of the plan, Gov. Ed Rendell, cruises along with a comfortable approval rating," said Clay F. Richards, assistant director of the polling institute.
Although 14 percent of those polled say corruption in the operation of the slots parlors is "a major problem," and 42 percent say it is "somewhat of a problem," the issue hasn't hurt Rendell's popularity.
Fast Eddie is enjoying a 52 percent approval rating versus a 34 percent disapproval rating - almost the same as his 53-36 percent rating in a November 7, 2007, Quinnipiac poll.
However, voters split evenly (42-42 percent) on whether they approve of the way Rendell is handling slot machine gambling.
With that kind of a disconnect between the corruption issue, the failure of tax reform and Rendell, it's no wonder the lame duck governor felt safe enough this week to say through a spokesman that he is keeping the $115,000 in campaign contributions he received from indicted slots parlor owner Louis DeNaples.
DeNaples, a Dunmore billionaire and federal felon, is accused of lying to the state Gaming Control Board about his ties to two reputed mobsters and two corrupt Philadelphia political fixers. He has denied any wrongdoing.
Richards said the poll found "a majority are concerned about corruption in the slots casinos, but about a quarter say it's not much of a problem."
If the public only knew what you now do, I doubt Rendell would be nearly as popular. Some folks have already been calling for his impeachment based solely on his failure to pass legitimate tax reform.
The poll also found that 42 percent of voters disapproved of the way the Legislature is handling its job, compared to 37 percent who approve.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Ed Rendell, Louis DeNaples, Pennsylvania, Quinnipiac University, slots
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Tuesday, March 04, 2008
Slotsylvania gambling regulators failed their duty
At least some of the state's seven Gaming Control Board members knew the state police were investigating Louis DeNaples for lying to them, but they publicly voted unanimously to award the politically-connected Dunmore billionaire a slots parlor license anyway on Dec. 20, 2006.In back-to-back hearings Tuesday, Col. Jeffrey Miller, the Pennsylvania State Police commissioner, told the Senate and House Appropriations Committees that one of his troopers told the gaming board's top agents that the investigation was ongoing when they asked about it in the weeks before the panel awarded a casino license to DeNaples, according to the Associated Press.
DeNaples was indicted Jan. 30 on four perjury charges for lying to the board about his alleged ties to two reputed mob bosses and two corrupt Philadelphia political fixers.
"The board should have known because the BIE (the gaming board's Bureau of Investigation and Enforcement) did know, because they were the ones who referred it to us in the first place," Miller told senators. He also said the bureau made three other referrals to outside agencies, including state police, on matters relating to DeNaples.
One of those outside agencies contacted was the Central Pennsylvania U.S. Attorney's office, which began its own investigation of DeNaples.
However, that probe had to be temporarily transferred in August 2007 to the federal prosecutors' Binghamton, N.Y., office after it was publicly disclosed that U.S. Attorney Thomas Marino was listed as one of two law enforcement references by DeNaples on his application for a slots parlor license.
Marino left office in October. He now works for DeNaples as in-house counsel for the billionaire's many other businesses, which include a landfill, a waste hauling business, an auto parts dealership and a motorcycle dealership as well as vast land holdings.
Because of the indictment against him, DeNaples has been suspended from a bank he chairs and the slots parlor he owns in Mount Airy. He has denied any wrongdoing and his defense attorneys have characterized the prosecution as headline-grabbing persecution by an overzealous Dauphin County District Attorney's office. The local prosecutor is handling the case with state Attorney General Tom Corbett's approval.
A gaming board spokesman refused comment on today's revelations.
In addition to tipping the state police and the feds to the possible perjury, the Gaming Control Board's investigators also alerted them to another matter involving DeNaples. They learned during their background check that DeNaples bought 30 tractor-trailers flooded by Hurricane Katrina in New Orleans for $180,000, and then allegedly sold at least one for use on the open road for $75,000 rather than scrapping it.
That state police probe for alleged "title washing" is reportedly still ongoing.
However, former gaming board chairman Tad Decker has said the board opted to dismiss the truck allegation during closed door negotiations. The board referred the matter in fall 2006 to the Department of State, which later reported it "didn't have any proof there was anything illegal."
Decker has previously blamed the state police for this mess, saying if the troopers had shared what they knew before the board voted, it wouldn't have given DeNaples a license. However, it was disclosed last month that the board never subpoenaed reputed mob boss Billy D'Elia to testify, even though his 30-year friendship with DeNaples is what sparked the perjury charges.
Even if none of the above set off a red flag for the gaming board's members, this should have at least given them pause.
DeNaples is a federal felon. He pleaded no contest in 1978 to defrauding the government of more than $500,000 for cleanup work associated with Hurricane Agnes. The 2004 law legalizing slot machine gambling did not bar him from owning a slots parlor, though, because it specifically forgave any offenses older than 15 years.
The question is why?
The state Supreme Court found in 2000 (Commonwealth ex rel. Baldwin v. Richard) that former felons are barred from holding any public office, period, no matter the basis for their conviction. So why did the state specifically let felons run its casinos?
That ruling was referred to in a 2001 Commonwealth Court ruling and a 2002 state Supreme Court affirmation which barred Republican Robert C. Bolus Sr. from running for Mayor of Scranton 10 years after his felony conviction for receiving stolen property. Bolus later tried to overturn the ruling by unsuccessfully suing the Supreme Court justices in federal court.
Bolus also happens to be an enemy of DeNaples and an auto parts competitor. He blamed DeNaples in written testimony before the Gaming Control Board in 2006 for what he claimed was a wrongful conviction.
"DeNaples will lie, cheat and even allow someone to be imprisoned to get his own way," Bolus testified. "Louis feels he can just buy anyone he wants."
Some of the same justices Bolus sued may soon decide whether to let DeNaples' prosecution continue after his lawyer filed a petition to have the high court intervene and dismiss the case last month.
Lawmakers have called the situation an embarrassment, although no consensus has emerged over how to change casino licensing to avoid the same thing from happening again, according to the Associated Press.
Meanwhile, DeNaples is forbidden from walking into his own casino or profiting from it, but is still legally free to lobby lawmakers. His company, Mount Airy #1 L.L.C, spent $67,375 last year lobbying for "casino gambling" through the Philadelphia firm of S.R. Wojdak & Associates LP, state records show.
Prior to the midnight passage of the 2004 law legalizing slot machine gambling, which barred direct political donations by slots parlor applicants, DeNaples contributed at least $679,375 and possibly more than $1 million to the state's top officials.
State records are shoddy. But Gov. Ed Rendell received at least $115,000 from DeNaples in campaign contributions between 2000 and 2004, and Corbett, the state's top prosecutor, accepted at least $35,000. Spokesmen for both told the Harrisburg Patriot-News this week they won't give the money back unless DeNaples is convicted. Other recipients of DeNaples' contributions included top state lawmakers, party groups and judges.
The seven Gaming Control Board members were appointed by Rendell and the top officials from each party in both the state House and Senate. There was no public vetting of their qualifications and no confirmation process, even though board members are paid $145,000 a year.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Ed Rendell, Jeffrey Miller, Louis DeNaples, Pennsylvania, slots, Tad Decker, Tom Corbett
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Monday, March 03, 2008
Corbett, Rendell keeping DeNaples' money
Look who finally woke up to the fact that our state is drowning in legalized gambling corruption? Why, it's the Patriot-News of Harrisburg.On Sunday, the better-late-than-never newspaper actually published a story about indicted slots parlor owner Louis DeNaples' extensive campaign contributions to the state's top elected officials, including Gov. Ed Rendell and Attorney General Tom Corbett.
The Patriot News' says DeNaples' total contributions were "as much as $840,275" between 2000 and 2005.
In 2006, the Times-Tribune of Scranton put the total at "$1,002,950."
My own research found DeNaples had contributed at least $679,375 between 2000 and 2004 under his own name and through two of the many business the Dunmore billionaire operates, D&L Realty and RAM Consultants.
However, records in the state's online campaign contributions database are clearly incomplete.
For instance, The Patriot reported that state's top prosecutor received $15,000 from D&L Realty in 2004 and 2005. My own research says he accepted at least $35,000, including a $10,000 donation on Jan. 27, 2004 and a $25,000 donation on April 15, 2004.
I will give the Patriot points, though, for finally asking Corbett if he would give the money back now that DeNaples has been indicted on perjury charges for allegedly lying to the Pennsylvania Gaming Control Board about his ties to reputed mobsters.
The answer the newspaper got shouldn't surprise you.
"When those contributions were accepted, he did not have a gaming license and they were legal contributions," said Kevin Harley, a spokesman for Corbett's office. "There's no plans to give the money back."
Ditto for Gov. Ed Rendell, who accepted at least $115,000 from DeNaples (on Aug. 6 and Aug. 13, 2002). The Patriot News did not state how much Rendell's campaign accepted.
"To this point, Mr. DeNaples stands accused but not convicted," said Chuck Ardo, the governor's spokesman. "It's incumbent on everyone to allow the legal system to work before decisions are made on how to react."
"Certainly, the governor will in no way involve himself with the legal proceedings," Ardo said.
Yeah, right. Ardo forgot to add the phrase "without a 10-foot pole."
In another Patriot News story, state Rep. Will Gabig (R-Carlisle) has called on the gaming board to release its background files on DeNaples.
"Even if Mr. DeNaples' previous felony conviction and his refusal to turn his FBI file over to investigators, as he was required to do so under the law, were not enough to raise questions in board members' minds ... certainly the fact that the board's own investigators believe he lied to them should have been," Gabig said in a statement. "... The board has some explaining to do regarding its decision to grant a license to someone who did not cooperate with their investigation."
It's worse than Gabig knows.
The gaming board never subpoenaed reputed mob boss Billy D'Elia, whose long friendship with DeNaples is what sparked the perjury charges in the first place. D'Elia's attorney said he would have been more than willing to testify.
Second, the board knew about but ignored an incident in which DeNaples was accused of selling at least one of 30 Hurricane Katrina-wrecked tractor-trailers for over-the-road hauling, rather than as scrap.
And who appointed the Gaming Control Board members in the first place? Why it was Rendell along with legislatives leaders in the state House and the Senate, many of whom also accepted campaign contributions from DeNaples.
For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.
Labels: casino, Ed Rendell, Louis DeNaples, Pennsylvania, slots, Tom Corbett