SANFORD, Fla. (AP) — Attorney Kelly Mathis says he simply gave legal advice to a veterans’ charity that ran a string of Internet cafes offering customers a chance to play sweepstakes while checking email and social media.
Prosecutors say the Internet cafes were a barely disguised, $290 million slot machine operation and Mathis was its mastermind. Jury selection for his trial starts Monday.
He faces over 200 counts of money laundering, lottery, possessing a slot machine and keeping a gambling house.
The prosecution says Mathis and the operators of Allied Veterans of the World were running a mostly bogus charity that got its money from dozens of casinos masquerading as Internet cafes throughout Florida. Prosecutors contend Mathis decided where to open the cafes and who would run them. They also say Allied Veterans spent only 2 percent of its proceeds on charitable works.
The arrest of Mathis and 56 other people in March prompted the Florida Legislature to ban the storefront Internet cafes and led to the resignation of former Lt. Gov. Jennifer Carroll, who had worked as a consultant for Allied Veterans. She has denied wrongdoing and wasn’t charged.
Mathis, a past president of the Jacksonville Bar Association, contends a successful prosecution will send a chilling effect to lawyers around the state who give legal advice to business clients.
“You can’t charge a lawyer in a conspiracy unless he has done more than practice the law,” said Mitch Stone, Mathis’ attorney.
“Absolutely, I will be found not guilty,” said Mathis, who will be the first of the co-defendants to go on trial. “I committed no crime. There is no evidence I committed any crime.”
Before Florida specifically banned the cafes earlier this year, a customer would purchase a prepaid card to use a computer for a specific amount of time, purportedly to browse the Internet.
While at the computer, the customers would be offered the chance to play games with spinning wheels similar to slot machines. The game had names such as “Captain Cash,” ”Lucky Shamrocks” and “Money Bunny.” Winners would get money added onto their prepaid card, which they could either use for more computer time or take back to a cashier and cash out. Each of the Internet cafes had rows of computers and a big sign that read: “This is not a gaming establishment.”
Mathis and Stone say the sweepstakes offered at Allied Veterans’ Internet cafes were no different than McDonald’s offering its customers scratch-off tickets or Coca-Cola offering prizes inside its caps. They said the games weren’t slot machines because the winners were predetermined, not randomly chosen by the computers.
“All of these games were designed to get people to buy more products,” Stone said.
Stone said county and city attorneys agreed that the cafes were lawful. The state Department of Agriculture regulated them and some of Florida’s top politicians, including state Attorney General Pam Bondi, either solicited or received money from their owners. Dozens of state lawmakers, the two major state political parties, local officials and law enforcement officials did the same.
But prosecutors say the cafes were a charade — almost every customer was there to gamble and everyone knew it. They say the operators of Allied Veterans paid themselves millions, spending it on boats, beachfront condos and Maseratis, Ferraris and Porsches. Authorities said Mathis made about $6 million from the operation, and they said he was the registered agent for 112 businesses related to their investigation.
After the arrests, Bondi called the alleged scam “callous” and “despicable” and said it “insults every American who ever wore a military uniform.”
Allied Veterans’ leader and former chief each have entered no contest pleas. Jerry Bass pleaded no contest to two counts of running an illegal lottery and won’t face any prison time. Johnny Duncan pleaded no contest to one count of money laundering and four counts of maintaining an illegal lottery. He will be sentenced to probation at a later date. Both may testify for prosecutors and defense attorneys during Mathis’ trial, which is expected to last two months.
The judge in the case rejected attorneys’ request to have Bondi answer questions in a deposition about her solicitation of a $25,000 campaign contribution on behalf of the Republican Party of Florida from one of the companies whose owners are charged with crimes.
Mathis said recently that his arrest has devastated his law practice, as well as his life. Before his arrest, he was the senior partner at a thriving law firm with seven attorneys. Now, all he has left is a legal assistant, he said.
“My office is decimated. Everyone else has gone,” Mathis said. “A day doesn’t go by that I don’t feel I have these false charges hanging over my head.”
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