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Arroyo at sweepstakes hearing: “Somebody here is lying”

Tuesday, Oct 29, 2019 - Posted by Rich Miller

* Dan Mihalopoulos at WBEZ last year

For years, Chicago Mayor Rahm Emanuel has been staunchly opposed to allowing video gambling machines at bars and restaurants in the city, hoping instead to land approval for one big downtown casino.

But unregulated devices that look and work almost exactly like video poker machines are popping up in places all over Chicago.

Thanks to these machines — often referred to as “sweepstakes” — the city has become studded with what effectively are mini-casinos in gas stations, convenience stores, and even a laundromat.

Unlike the video poker machines that the state has regulated and taxed since 2012, the other machines don’t pay state or local government. And the state does not conduct background checks of sweepstakes machine operators or the businesses that install them, as is required for video poker licenses.

* Tribune

According to the charges unveiled Monday, CW-1 told the FBI that [Rep. Luis Arroyo, D-Chicago] had approached him about “the passage of sweepstakes-related legislation” during the House’s spring session.

Arroyo is a manager of a lobbying firm called Spartacus 3 LLC, which includes as a client the owner of a company involved in video gambling sweepstakes machines, according to the complaint.

Sweepstakes machines, sometimes called “gray machines,” allow customers to put in money, receive a coupon to redeem for merchandise online and then play electronic games like slot machines. Critics contend the largely unregulated devices, which operate in cities like Chicago that have banned video gambling, are designed to skirt the law.

In that Mihalopoulos story from last year, House Republican Leader Jim Durkin, who sponsored a bill to outlaw the machines, said he played a sweepstakes machine and was paid a cash prize, not a coupon.

* Sun-Times

The case against Arroyo revolves around his lobbying work in Chicago as manager of Spartacus 3 LLC. Arroyo signed a deal between Spartacus 3 and V.S.S. Inc. in August 2018 that promised $2,500 in monthly payments from V.S.S. to Spartacus. V.S.S. had hired Arroyo’s company to lobby the Chicago City Council for a sweepstakes ordinance, according to the feds.

Sweepstakes machines are not regulated by the Illinois Gaming Board but look like regular slot machines.

Ald. Gilbert Villegas (36th) said he introduced an ordinance in 2018 to legalize sweepstakes machines in the city and tax them after being approached by Arroyo on behalf of two firms “that wanted to come out of the shadows” to end questions about whether they were operating lawfully.

Also contacting Villegas in support of the ordinance was James Weiss, son-in-law of former Cook County assessor and Democratic chairman Joe Berrios, the alderman said. Villegas said Weiss is an owner-operator of sweepstakes machines. Weiss is married to Berrios’ daughter, former state Rep. Toni Berrios.

* Mihalopoulos yesterday dug up the recording of a House committee hearing in May about sweepstakes games

[Former Gaming Board lawyer William Bogot], who is now in private practice, told lawmakers that “every published case in the country that has looked at a sweepstakes vending machine has held them to be illegal.”

At that point, Arroyo interrupted Bogot.

“I’m just concerned with Illinois,” Arroyo said. “Not New York, none of the other states. I don’t care what goes on in any of those other states. I want to know what’s happening here.”

Arroyo said a lobbyist for the sweepstakes companies had testified that there were court cases in their favor.

“He says it’s not illegal, you’re saying it’s illegal,” Arroyo told Bogot. “Somebody here is lying. Why are you up here saying it’s illegal? Either you’re lying or the gentleman in the back [of the] room is lying.”

Oops.

       

19 Comments
  1. - A guy - Tuesday, Oct 29, 19 @ 10:13 am:

    Gentlemen….don’t lie.


  2. - Cubs in '16 - Tuesday, Oct 29, 19 @ 10:23 am:

    Let’s see, whom would I be more inclined to believe in this situation…an attorney or a lobster?


  3. - cover - Tuesday, Oct 29, 19 @ 10:26 am:

    Seems like the time is right for Leader Durkin to reintroduce his bill to ban the sweepstakes machines.


  4. - Vss - Tuesday, Oct 29, 19 @ 10:44 am:

    SoS site lists John Andreani as the president of the only V.S.S inc still active. Is that the same guy kicked off the chicago police force in 2015? Could be different company too i suppose. Enquiring minds want to know


  5. - Amalia - Tuesday, Oct 29, 19 @ 10:45 am:

    Arroy-GO…..


  6. - max - Tuesday, Oct 29, 19 @ 10:57 am:

    the feds need to visit Mr. Andreani. Was he told who to hire as his lobbyist? If so, who instructed him to hire the lobbyist? Who else does Andreani report to? there is a lot to look at here. its a jackpot.


  7. - Oswego Willy - Tuesday, Oct 29, 19 @ 11:15 am:

    === RINO===

    Yeah, ok, whatever.

    Hope you feel better, don’t hyper-ventilate


  8. - Fav human - Tuesday, Oct 29, 19 @ 11:16 am:

    Actually Arroyo’s question was quite reasonable. either there was case law or there wasn’t. zhe was right to ask that it be clarified.

    Of course the coupon thing has been done in Japan for years at pachinko places


  9. - qualified someone nobody sent - Tuesday, Oct 29, 19 @ 11:18 am:

    Just when we though the Berrios name would fade into the past. A new chapter begins….


  10. - Ron Burgundy - Tuesday, Oct 29, 19 @ 11:21 am:

    No I don’t think his question was reasonable. Both the Gaming Board attorney and the lobbyist could be correct as there could be decisions outlawing the machines in some places and allowing them in others. That doesn’t mean one or the other was “lying.” Turns out the only person lying there was Arroyo. Lying by omission.


  11. - Ron Burgundy - Tuesday, Oct 29, 19 @ 11:23 am:

    -A new Berrios chapter begins-

    Grifters gonna grift.


  12. - James - Tuesday, Oct 29, 19 @ 11:51 am:

    These machines should be banned. They’re not licensed and are just sucking up the potential revenue from a Chicago casino. Arroyo should be prosecuted for silently creating this underground network. Berrios and Villegas–Lightfoot’s floor leader–share the blame for being enablers. Thanks to WBEZ for reporting this 14 months ago–people in power should have paid closer attention–that goes for Emanuel, Lightfoot and Foxx who all had or have the ability to stop these practices, but it took the feds to blow the whistle.


  13. - Yep - Tuesday, Oct 29, 19 @ 11:53 am:

    Yep once the smoke clears on the gambling, the smoke will rise on the marijuana deals. Anyone feel nervous yet? Smoke if ya got em.


  14. - NoGifts - Tuesday, Oct 29, 19 @ 12:08 pm:

    Spartacus 3 LOL “The quote “I am Spartacus” is dervied from the 1960 movie “Spartacus” directed by Stanley Kubrick and starring Kirk Douglas as the titular role. Near the end of the film, a Roman general announces to a group of former slaves that unsuccesfully fought againsts their rulers that unless Spartacus is turned over to them, all of the slaves will be crucified. Spartacus is then willing to turn himself in to protect his friends by standing up and proclaiming “I am Spartacus!”, but then the rest of the slaves show their loyalty to him by also proclaming that himself is Spartacus in great numbers. Since the general still doesn’t know who the real Spartacus is, all of the slaves are led to crucifixion.”


  15. - Ron Burgundy - Tuesday, Oct 29, 19 @ 12:29 pm:

    Yep - Between this, the capital bill and marijuana, you can smell more than just the meat a’cooking.


  16. - Anon 2:20 - Tuesday, Oct 29, 19 @ 2:21 pm:

    I see that McGuire Woods Consulting is no longer representing V.S.S. as of today.


  17. - Anon 2:24 - Tuesday, Oct 29, 19 @ 2:24 pm:

    =RINO Durkin is only concerned because this affects his … gambling investments.=

    This is borderline slander.


  18. - Anonymous - Tuesday, Oct 29, 19 @ 9:09 pm:

    Check out the V.S.S. Inc. on SOS that was dissolved in 1991…It’s agent was Helen Volpendesto of Cicero. Is that just some bizarre coincidence?


  19. - badday - Tuesday, Oct 29, 19 @ 10:23 pm:

    - Anon 2:20 - Tuesday, Oct 29, 19 @ 2:21 pm:

    I see that McGuire Woods Consulting is no longer representing V.S.S. as of today.

    Anon - you will have to show us all where you saw McGuire Woods was representing them in the first place. They weren’t included on the lobbyist list Rich posted or on the Sec. of State website that I can see.


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