Raids close three gambling centers in Fort Worth

[Qbins Missile Crisis]

FORT WORTH -- State authorities simultaneously raided three Fort Worth eight-liner game rooms Wednesday, part of a statewide crackdown on Ace Gaming Amusement Centers.

The game rooms are alleged to be "casinolike operations that derive their income from illegal gambling," said Tom Vinger, a spokesman for the Texas Department of Public Safety.

Search and seizure warrants were also executed at Ace centers in Dallas, Corpus ******i, San Antonio, and Copperas Cove.

Ken Griffith, president of Dallas-based Aces Wired Inc., which operates the game rooms, vowed to fight the allegations.

"We believe the actions taken today are completely without merit and have no legal basis and we look forward to our day in court," Griffith said in a news release.

The machines "are expressly designed and deployed in a manner that is compliant with Texas law."

Aces Wired officials have said their machines are legal because they do not reward players with cash or gift certificates, which is illegal in Texas. Instead, players accumulate "prize points" on cards similar to debit cards that can be redeemed for merchandise at certain retailers.

However, Texas Attorney General Greg Abbott, in a nonbinding opinion, has called the stored-value cards illegal.

The raids were the culmination of a six-month investigation involving the DPS criminal intelligence services, the attorney general and local jurisdictions.

The warrants allege that Aces Wired's gaming constitutes illegal gambling, money laundering and organized crime, according to the Bexar County district attorney's office.

The raids

Before 11 a.m., officers in black vests swept into the Ace game room at Sylvania Avenue and Belknap Street.

"There were carloads of them and they just pulled up and hit it real quick," said John Turntine, who works across the street at the Sylvania Professional Building. "They rushed into the building and it was over."

Raids at other Ace game rooms occurred at the same moment, authorities said. Aces Wired corporate offices in Dallas were also raided. In San Antonio, authorities seized more than $600,000 in "alleged criminal proceeds."

Several employees were arrested, though the charges were not immediately clear, said Steve Fenoglio, an attorney for Aces Wired.

Customers were not arrested on gambling charges, but in Fort Worth seven people were arrested for outstanding warrants and one for possession of drugs, said Lt. Paul Henderson, a Fort Worth police spokesman.

At the Crowley Road location, officers loaded electronic games with names such as Haunted House, Big Pay Day, and Cheese onto a trailer attached to a Tarrant County sheriff's truck.

It was not immediately clear how many machines were seized, Vinger said. Aces officials have previously said the Crowley Road location alone had 100 machines. Statewide, Aces has more than 400 machines.

Customers periodically pulled into the parking lot, stopped and stared at the commotion.

"What's the deal?" one woman shouted to a state officer.

"It's closed!" he shouted back.

Open operations

Unlike many eight-liner businesses that operate quietly, Aces Wired arrives in cities with large ads in the newspaper and bright signs atop its buildings. It also sends information packets to law enforcement agencies outlining its operations.

Company officials counter Abbott's opinion that the stored-value cards are illegal with a former Texas Supreme Court judge's ruling during an arbitration case that the system meets state gaming laws. Last year Aces Wired, a publically traded company, reported about $18 million in revenue, though much of it came from its bingo supply company.

Turntine said the Sylvania location in Fort Worth was popular.

"Last Friday evening, it was so crowded that people were parking behind other businesses," he said. "Seemed like they did well."

Aces Wired officials became aware last week that "trouble was on the horizon" and tried unsuccessfully to discuss it with state officials, Fenoglio said. He suggested that DPS investigators were interested in Aces Wired because a company subsidiary is trying to acquire controlling interest in a greyhound track in Corpus ******i. The Texas Racing Act requires the state to conduct a background check, he said.

"We're transparent," he said. "We're not hiding anything."

Tom Kelley, a spokesman for the attorney general, declined to comment other than to say that the warrants executed Wednesday were for evidence "allegedly tied to a gambling operation."

The Tarrant County district attorney's office declined to comment because the case is ongoing.

ALL ABOUT ACE

How it works

New players open accounts with value cards by presenting their drivers licenses or Social Security cards. To play, the cards and cash are inserted into the gaming machines, and the cash is loaded onto the card. Each play costs a penny, a nickel or a dime. As customers play, money is taken off their cards and as they win, prize points are added. Once enough prize points are accumulated, cardholders can use the cards at stores such as Dillard's or Shell gas stations by swiping them like debit cards. The account can be accessed only with a private pin number, and Aces monitors each transaction.

Why Ace says it's legal

The system falls under a 1993 exception to state gaming laws that allows electronic games offering noncash prizes worth no more than $5 per play or coupons redeemable for such items.

Why the state disagrees

The system is illegal because the stored-value card is used in the same manner as legal tender in the retail establishment.

By ALEX BRANCH
Star-Telegram Staff Writer
star-telegram.com