Wednesday, August 31, 2011

Internet Money | Internet Cafe Crackdown Renews Legal Debate

But when a Central Florida sheriff recently captured headlines after shutting one down and declaring all of them clearly illegal, it reignited a debate about these so-called "strip-mall casinos."

About 1,000 of these businesses have popped up in Florida in recent years, saying they are allowed under a sweepstakes provision of state law.

Opponents say these operations are simply illegal gambling houses that attract crime and other problems and have nothing to do with sweepstakes.

The confusion has resulted in a patchwork of enforcement across the state, with some jurisdictions fighting an uphill battle to block these businesses, while others have given up the fight as they wait for lawmakers to clarify the issue.

"It's abundantly clear that what they are doing is gambling," said Polk County Sheriff Grady Judd , who shut down The Horseshoe Internet cafe south of Clermont on Aug. 15 and arrested two people: an Orlando man and a Deltona woman. "I don't know why it is some jurisdictions are more aggressive than others."

Loophole or not?

Judd joins a short list of officials willing to crack down on the cafes.

Assistant State Attorney Mark Simpson of the 5th Judicial Circuit already tried that in his district, which includes Lake, Marion, Sumter, Citrus and Hernando counties. Last year, he took two Ocala-area cafe owners to trial and lost both times.

"They have driven a Mack truck through a needle-sized loophole," said Simpson, who no longer encourages authorities in his district to challenge such businesses.

The industry's bottomless coffers, formidable defense attorneys and a technicality in state law are huge roadblocks for prosecutors with restricted resources, Simpson said.

"They make money hand over fist and have tons and tons of it they use to fight legal cases," Simpson said. "If the Legislature wants gambling on every street corner, then, by God, they are doing a good job by doing nothing."

Supporters say the businesses are sanctioned by Florida's sweepstakes law, which allows the businesses to operate like game promotions at popular fast-food restaurants. When a customer buys a product - Internet time, for example - they are given entries into the sweepstakes.

"The law is clearly stated. Sweepstakes are legal in the state of Florida. Those that disagree with the law call it a loophole," said Jacksonville attorney Kelly B. Mathis, who represents Allied Veterans of the World, a group that operates 39 cafes in the state.

No Florida judge has ruled that the computerized games are slot machines - which are illegal in Florida unless they are regulated by the state under specific circumstances.

One local lawmaker wants all-out ban

Some lawmakers have even got into the business.

State Rep. Peter Nehr, R-Tarpon Springs, opened an Internet cafe last year in Palm Harbor. State Sen. Mike Bennett , R-Bradenton, is part-owner of a sports club that houses one.

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