LAURINBURG — With relative silence on the subject from the state level despite an announcement made on Tuesday by a two-county law enforcement task force promising, effective July 1, the forced closure of all sweepstakes cafes still in operation, the long-term future of Internet gambling in Scotland County and North Carolina remains unsettled.
Following the announcement, on Wednesday darkened doors and an empty parking lot contradicted the “24 hours” appliques in the windows of Main Street Internet Café. JB’s Business Center, also on Main Street, was also closed on Wednesday, with part of its sign dismantled. Jerry Bass, the owner of JB’s, currently faces charges in Richmond County dating from August, when authorities shut down Internet cafes under his ownership in Hamlet and Rockingham.
Bass is expected to appear in court on July 21 on charges of gambling, allowing gambling tables, operating/possessing slot machines, having an electronic sweepstakes, and operating five or more video gaming machines.
The notice being disseminated this week to sweepstakes businesses by the Hoke and Scotland County Joint Gaming Task Force, whose formation was announced last month by District Attorney Kristy Newton, maintains the illegality of possessing, operating, or playing internet sweepstakes machines.
The process of giving sweepstakes owners a deadline to close and then enforcing the directive following that deadline replicates the actions of local law enforcement after a state Supreme Court ruling in early 2013 that upheld the constitutionality of the statewide sweepstakes ban and the subsequent lifting of an injunction against enforcement.
However, the state law which sweepstakes proprietors and some prosecutors elsewhere in the state say leaves a loophole for certain types of gaming software is not likely to change as quickly as the attitude of Scotland County’s law enforcement.
“The legislature has left a statute in place that, despite whatever anybody says or you hear, is unclear as to its applicability to some of the software that’s being used in these establishments,” City Attorney Bill Floyd told a group of anti-sweepstakes residents at this month’s Laurinburg City Council work session.
Since December, the city has issued more than 20 permits to sweepstakes cafes, and it is unclear whether or not they will continue to do so after June 30. To date, the city has deferred to law enforcement regarding its policy of granting business licenses — and charging hefty privilege fees — for internet gambling.
Hickory attorney Lisa Dubs, who represents Blue Diamond, one of the companies which designs and manufactures “pre-reveal” software, said that the company believes that its product conforms to state statute.
“Gambling is not illegal in North Carolina – we’ve got a lottery, we’ve got Cherokee,” Dubs said earlier this month. “We’ve also got skill and dexterity games that are running. There are all kinds of exceptions. It’s not the case that all sweepstakes are illegal or that gambling is illegal.”
Among the concerns voiced by sweepstakes opponents are the proximity of the businesses to each other, with more than half a dozen located within a one-mile stretch on South Main Street. However, city officials have said that to regulate sweepstakes through zoning may be viewed as an endorsement of the businesses’ legality.
Dubs said that she knows of no municipality in the 40-plus North Carolina counties currently housing sweepstakes to have faced legal action after imposing zoning restrictions on internet cafes. She added that businesses using Blue Diamond software agree to the company’s geographical “non-compete clause,” which establishes a minimum distance between cafes using the software. Fewer than half of Laurinburg’s internet cafes are utilizing that particular software.
“You’ve already got municipalities who are having people pay for privilege licenses and per machine fees,” she said. “That’s already going on so it doesn’t seem to me that further regulating it would be more complicit.”
State Rep. Garland Pierce of Wagram reaffirmed on Wednesday what Scotland County’s state representatives have said in the past — hat the General Assembly is unlikely to revisit its gambling statutes in the foreseeable future. Both Pierce and state Rep. Ken Goodman have theorized that, in doing so, the state will seek to reap financial benefits of its own from North Carolina’s sweepstakes operations.
“At the very most the law is unclear,” Dubs said. “With a criminal statute, when the law is unclear something about it needs to be fixed.”
Reach Mary Katherine Murphy at 910-276-2311, ext. 17. Follow her on Twitter @emkaylbg.