Is Organized Crime an Indian Gaming Problem
By Brian Dolan
WASHINGTON –Rep. Christopher Shays (R-4) is sponsoring legislation that calls for an investigation into the influence of non-Native American investors and organized crime on Indian gaming.
He introduced the bill last week, one day before the federal government formally recognized the Schaghticoke Tribal Nation, a move that could clear the way for the Connecticut-based tribe to open a casino in the state.
“With so much at stake, casino development interests are often willing to spend huge sums of money on the chance that they can influence the process,” Shays said in a statement Wednesday. “To make sure the federal recognition process is accountable and transparent, it is important to know all the interests in play, including who is financing the petitioners and any possible connections to organized crime.”
Chief Richard Velky of the Schaghticoke Tribal Nation would not disclose where his tribe gets its financial backing.
Fred DeLuca, the founder and chief executive officer of Subway Restaurants, financed the Schaghticokes for an undisclosed period of time, according to his spokespeople. They said the investment was personal and not related to the restaurant.
DeLuca invested in the Tribal Nation under an agreement that he would be repaid with a profit, a source close to the Indian gaming industry said. DeLuca also wished to help develop the Bridgeport area, which is where he founded Subway Restaurants, and thought bringing Indian gaming to the area would provide an economic boom, the source said.
DeLuca did not return several calls requesting comment.
Other key financial backers of the Schaghticokes include John C. Ellis, formerly a catcher for the New York Yankees and the Cleveland Indians, and former state Rep. Dean P. Markham of Markham Associates. The two established the Native American Gaming Fund to raise money for a Schaghticoke casino, according to the Hartford Courant. In a telephone interview Thursday, Ellis confirmed his membership in the fund, but referred further questions to the fund’s attorney, Stephen A. Zrenda. He declined comment.
Velky said his tribe solicits funds only from potential backers who have the best interests of the tribe in mind. He said non-Native American investors do not exert undue influence over the Schaghticokes. “The only pressure on the tribe was relieved last week once the Bureau of Indian Affairs recognized us,” Velky said. “We would never ask any person who would use financial pressure to help us out.” Following last year’s murder of prominent Middletown businessman Joseph Mazotta, whose father had ties to the Genovese crime family, local police began investigating the Mazotta family’s investments in the Schaghticoke Indian tribe, the Hartford Courant reported. The Middletown police department declined comment.
“They are not my investors,” Velky said of the Mazzota family. He said the tribe had to steer clear of any potentially troublesome backers in order to gain federal recognition.
“You think it’s tough to get federal recognition? Velky asked. “Well, the [National Indian Gaming] Commission has a tougher screening process for financial backers. If an Indian tribe ever tried anything like [working with organized crime], I don’t think they’d cut the mustard for the federal authorities.” Traditionally, the gambling industry has attracted criminal interests because it involves many undocumented financial transactions, said Philip N. Hogen, the commission’s chairman. “The good news for tribal gaming is the whole industry of gaming has evolved since its beginnings, when mobs and organized crime influences were the rule and not the exception,” Hogen said. “These days firms on Wall Street can and do invest in gaming.”
Guy Michael Brown, the former head of Foxwoods Resort Casino in Ledyard , Conn. , and former consultant to the Schaghticoke Tribal Nation, said organized crime factions did attempt to do business with that casino.
“There were two or three attempts to do business with us,” Brown said. “The Connecticut state police and the FBI took care of it, though-one was a credit card scheme that resulted in many arrests.”
But Velky said the Schaghticokes are looking forward not to casinos but to improved health care and a new 10-unit housing facility for their elders — just a few of the perks, he said, that will flow from federal recognition.
“We have always felt the social programs are more important than any financial ones,” Velky said.
