New state gambling laws doom poker clubs, Cherry Masters

A crackdown on illegal gambling will force some clubs and bars to change or find new ways to attract customers.

Cherry Masters, electronic slot machines, will be the target of Indiana’s new gaming police, and Texas Hold’em clubs like Royal Crown in downtown Muncie will close after midnight with a new crackdown on illegal gambling.

“The state has declared us a game of chance,” said Linda Koger, who owns Muncie Liquors and is a partner in the downtown poker club. “We are being forced to close our doors.”

The option, Koger said, would be possibly facing a class C felony charge for promoting professional gambling.

During its last session, the Legislature approved House Bill 1510, which included new penalties for possessing electronic gaming devices like Cherry Masters and promoting illegal gaming like drawings, pull tabs and sports pools.

That law also redefined gambling as risking money or other property for gain, contingent in whole or in part, upon chance, and only permits charitable gaming. And it gave the gaming commission authority to enforce that law.

“We always contended that the law made them illegal,” Ernest Yelton, executive director of the Indiana Gaming Commission, said about Texas Hold-em clubs.

The clubs generally have membership and seating fees. Royal Crown had a big celebrity opening last year with longtime Tonight Show announcer Ed McMahon.

The gaming commission got 16 new officers strictly to go after illegal gambling. Yelton said video gaming like Cherry Masters would be the priority for enforcement, although other forms of illegal gambling would be addressed with cooperation of the Indiana Alcohol and Tobacco Commission, which enforces the law for holders of alcohol, tobacco and retail permits.

“The governor and the Legislature sent a strong message that in Indiana you have two types of gambling, legal and illegal,” said Yelton. “The one that is legal will be strictly regulated, and the one that is illegal will not be allowed.”
Regular players

A handful of poker players were standing outside Royal Crown Wednesday night, talking about the club closing as dealers planned some big dealouts on the final night.

“This is a club and it should be left as a club,” said Joe Ramos, a former dealer and player.

Ramos said Texas Hold’em offered entertainment for many people, with as many as 100 people a night playing at the downtown club.

“I guess I could go to a bar, get drunk and then get pulled over,” he said.

Ryan Clements, who runs the club, said the closing would be like losing family given the number of regular players.

“We have never had any problems,” Clements said.

The closing puts 15 people out of work and shutters a downtown storefront. Koger said she was still looking at how the club might be turned over to a charity.

Rep. Dennis Tyler, D-Muncie, voted for HB 1510, and said he did not know the bill would put Texas Hold’em clubs out of business. Tyler also has been criticized by some bar and restaurant owners for approving slot machines at horse tracks, including nearby Hoosier Park, while outlawing other gaming in other establishments.

“We did that to have property tax relief,” Tyler said, referring to how money from slots would fund property tax rebate checks to homeowners.

Tyler had a bill to legalize drawings, polls and pull tabs in bars, but that legislation never got in the final bill. He will renew those efforts during the short session.
No ‘Wanted’ poster

Brad Klopfenstein, executive director of Indiana Licensed Beverage Association, said some bar and restaurant owners would face a serious adjustment to the new enforcement effort by the gaming commission and other efforts by excise police enforcing alcohol and tobacco regulations.

“We are entering a whole new world here,” said Klopfenstein, who said the new gaming police were not unlike Elliott Ness and the “Untouchables,” special U.S. Treasury agents who enforced federal prohibition laws during the 1930s.

Yelton responded, “I can assure you we have no ‘Wanted’ poster here,”

The gaming commission is still working on a policy to enforce gaming laws, and Yelton said there were no plans to target eastern Indiana, even though the region was the headquarters for former Teamsters boss John Neal’s video gambling empire.

Neal was arrested last year on video gambling and money laundering charges, just two years after getting out of prison after serving time on charges of operating illegal gambling business, conspiracy to defraud the IRS and money laundering. Neal remains in the Ashland, Ky. federal prison on a probation violation from his previous conviction.

Yelton estimated there could be as many as 5,000 to 40,000 Cherry Masters or other video gaming machines throughout the state, still found in truck stops, tobacco stores, bars and other retail establishments.
Closing or changing

Klopfenstein said two Fort Wayne bars already closed over the pending enforcement and he expected the gaming police would make video gaming a priority.

Tammie’s Lounge was among the last local bars to have video gambling machines last fall when excise police issued citations there last November. Owner Tammie Rigney got rid of the machines and paid the citation.

“I am done with them,” Rigney said.

A few weeks ago, Rigney had a party where she paid out all drawings, NASCAR cards and sports pools, and ended that form of gaming. Doc Peterson’s trio, including Phil Dunn and Garland Simmons, played music as customers lamented the loss of popular gaming pastimes.

“I paid out 100 percent of everything,” said Rigney, who recalled how as many as 150 people would come on Saturdays to participate in drawings. “We are constantly looking at new ideas to bring people in the doors.”

One of those ideas is a party today (Saturday) at Irving’s Water Bowl with six live bands and a $5 charge.

As for the crackdown on gaming, Rigney said, “This is going to hurt a lot of people. It will be interesting what people in our business will do.”

The Star Press (06/30/07)

Author Contact Info: Rick Yencer