Gingrich: Among the Gaming Planners who Targeted Abramoff

[Susan Bradford]

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Recently the public was agog when billionaire casino mogul Sheldon Adelson donated $5 million to Winning Our Future, a super PAC which supports Newt Gingrich’s presidential bid.

Adelson justified his contribution by explaining that he shares Gingrich’s support of Israel.

The CEO of Las Vegas Sands also shares Gingrich’s love for casinos.

In 1997, when a rising star lobbyist by the name of Jack Abramoff was blocking the expansion of gaming on behalf of his tribal clients, Gingrich, as House Speaker, appointed Kay James to head a National Gaming Impact Study Commission.

Two years later the Commission produced a “comprehensive legal and factual study of the social and economic implications of gambling in the United States” for President Bill Clinton, Congress, state governors, and tribal leaders.

What the report reflected more than anything was the casino industry’s tight relationship with the federal government.

Legislators can create laws that allow some gaming enterprises to flourish at the expense of others. In turn, the highly lucrative gaming businesses can reward complicit officials by keeping campaign coffers topped off with cash.

Interfering with this cash flow by obstructing the proliferation of casinos was the surest way to have a target affixed on one’s back, as Abramoff was soon to discover.

Among the representatives and participants in the Commission’s study were a nexus of individuals and interests which sought to remove Abramoff from the tribal gambling scene.

By 1999, Abramoff was attempting to enter the Florida casino market by attempting to purchase the SunCruz gaming fleet, which offered “cruises to nowhere,” allowing pensioners to enjoy light entertainment while gambling on the high seas.

SunCruz was positioned to provide fierce competition against the nearby Seminole Tribe of Florida.

With the most effective deterrent to new entrants into the casino market poised to represent the fleet, the Seminole’s gaming aspirations could have been severely curtailed within the state.

However, Abramoff’s plans were foiled from the start as SunCruz collapsed into bankruptcy.

The lobbyist was later indicted, along with his partner, Adam Kidan, for the fraud surrounding the loan even though the lobbyist was not complicit in the improprieties that occurred.

As the ensuing bankruptcy proceedings (Boulis Creditors’ Notice of Filing of Complaint Filed by Citadel Equity Fund, Ltd., Against Wells Fargo Foothill, Inc.) reveal, Wells Fargo allegedly embedded the fraud and structured Abramoff’s loan to implode on the advice of its counsel, Schulte Roth & Zabel, which represented the Seminole Tribe of Florida’s financial consultant, Merrill Lynch.

Once Abramoff was removed from its market, the Seminoles negotiated a lucrative gaming compact with the Florida, with the son of the judge who presided over his SunCruz proceedings representing the state. The tribe then proceeded to purchase the Hard Rock franchise for $1 billion. SunCruz has since gone out of business.

Interestingly, in the year in which Abramoff endeavored to purchase SunCruz, the Commission recommended a “prohibition of cruises to nowhere.”

The report also incorporated a statement from MGM Grand CEO Terrence Lanni who announced his aspirations to “legalize commercial casinos in Detroit, Michigan.”

In 2001, Abramoff began representing the Saginaw Chippewa Indian Tribe of Michigan, which retained him to protect the tribe’s casino by blocking new entrants into its market.

After working tirelessly to keep the expansion of gaming in check, Abramoff was forcibly removed as lobbyist, allowing casinos to proliferate around the state.

Also contributing to the Commission was lobbyist Tom Rodgers of Carlyle Consulting, who coordinated the tribal dissidents and media against Abramoff. Minnesota Indian Gaming Association Chair and Commission tribal representative Stanley Crooks praised Rodgers for his “efforts to educate our congressional delegation on the National Gambling Impact Study Commission Report….(His) vigilance and foresight are always evidence and will help us keep a step ahead of our enemies.”

Another tribal representative who appeared before the Commission was Tony Beltram, a Council Member at the Mashantucket Pequot Tribal Nation, which owns the lucrative MGM Foxwoods casino.

According to the Hartford Courant, Beltram served seven years in prison for stabbing a teenager in the back and paralyzing him from the chest down.

Among the resources for the Commission was Robert Hayward, Chairman of the Mashantucket Pequot Tribal Gaming Commission, whose stated mission is to “provide sound regulation of all the gaming activities of the Mashantucket Pequot Tribe in order to protect the interest in the integrity of Tribal gaming and to prevent improper or unlawful conduct in the course of gaming activities conducted on the Reservation.”

In 2006, the year Abramoff entered prison, the Pequots forged a “strategic alliance” with MGM Mirage. Representing the tribe were Scott Reed and Larry Rosenthal, former aides to Sen. John McCain and Congressman Dale Kildee, respectively, who worked behind the scenes to deliver Abramoff to the Senate Indian Affairs Committee. Serving alongside them on behalf of the Pequots, was Christy Evans, a former aide to Gingrich.

Rosenthal and Reed had also by this point claimed the Seminoles as a client which was rapidly moving ahead to expand its gaming interests in the state before tapping the Saginaw Chippewas, a former Abramoff client.

The Commission brought together Christian evangelicals and gaming advocates to discuss gambling. The Christian participants typically provided the moral arguments to oppose the vice, citing the social consequences of gambling to block a given gambling enterprise on behalf of another.

As Lanni said in his statement, “Although the views of my fellow Commissioners included those of strong anti-gaming advocates as well as strong gaming advocates such as my own, the vast majority of the recommendations approved by the Commission received our unanimous support. Moreover, most of the Commission’s recommendations were either suggested or supported by the commercial casino industry, or are already being implemented by that industry today.”

After the report was published, individually published versions of the Commission’s Executive Summary mysteriously disappeared. “The electronic version of the 1999 U.S. Gambling Commission raises concerns, since the electronic version no longer highlight(s) Kay C. James’ introductory letter summarizing the Commission’s recommendation for a moratorium on the expansion of any type of gambling anywhere,” noted the U.S. International Gambling Report.

“Furthermore, the initial website for the NGISC Final Report and related documents, such as the NGISC Executive Summary, as well as the Commission’s website, were altered over a short period of time,” the Report continued. “Within a few short years, some connecting links to source materials were obscured or eliminated. Considering that, like Big Tobacco, pro-gambling interests and their lobbyists were constantly suppressing and even eliminating academic and source material embarrassing to gambling interests, the U.S. Government’s failures in preserving some source documents was outrageous.”

Adelson probably considers his donation to Gingrich’s PAC a “good investment,” though it was probably a harbinger of more casino capitalism to come should the former House Speaker receive the presidential nod.

Susan Bradford is the author of Lynched! The Shocking Story of How the Political Establishment Manufactured a Scandal to Have Republican Super-lobbyist Jack Abramoff Removed from Power. For article archives and more information, please visit, www.susanbradford.org.

© Susan Bradford 2012