Operating A Gambling Establishment

By Reid Jowers

This commission would grant licences for operating gambling establishments; offer recommendations about regulating the gambling industry; collect fees and levies from licence holders; and 'ensure that licensed activities are conducted in a fair and honest manner,' among other responsibilities. The problem has continued unabated during the COVID-19 pandemic in violation of gathering rules and business operating limits, Blumenfield said. Leasing to operators of gambling establishments.

Reporting Texas

Texas Card House General Manager James Combs is seen on March 2, 2019. Texas Card House is a private club and requires a daily, monthly or yearly membership. Brittany Mendez/Reporting Texas

On a Monday afternoon in March, Will, a 24-year-old software engineer in Austin, was relaxing during a break from a poker game at the Texas Card House in North Austin, where brightly lit rooms and affable service are a contrast to the image some people might have of a gambling establishment.

Will (his last name has been omitted to protect his privacy) started playing poker five years ago when friends introduced him to the game. He loved it.

'I like that it's a beatable game. You focus and practice to get good. It's a matter of skill rather than luck like blackjack or other games,' Will said.

The Texas Constitution prohibits most forms of gambling. The few exceptions include private gambling at home, betting on sanctioned horse and dog races, the state lottery and gambling at one of the three Indian casinos in the state. During the last several years, some gamblers have started using a loophole in state law to play cards for money at so-called card clubs, such as Texas Card House.

In 2015, Austin-born Texas hold'em poker player Sam von Kennel noticed a legal technicality that would allow him to open a gambling establishment. According to state law, gambling houses can operate as long as they don't take a percentage of the pot. Von Kennel had an idea. Instead of taking a cut of the pot, he would charge membership dues and hourly or half-hourly fees for players to participate in a game. Based on his idea, von Kennel opened Post Oak in Houston, the first private social card club in Texas. Since then, about 30 other membership-only card clubs have sprung up around the state, he says.

On a typical weekend, Texas Card House hosts as many as 100 members at a time — a mostly male crowd that is diverse in ethnicity and age. Some poker games, the ones popular among regulars, have a buy-in of $300 and a potential payout of a few thousand dollars. Lower-stakes games have buy-ins as small as $40.

States that allow gambling still make a killing off casinos compared to the card houses in Texas. For example, Louisiana and Oklahoma annually average $2.4 billion and $4.4 billion, respectively, according to state revenue reports.

A tournament takes place at Texas Card House in Austin on March 2, 2019. Brittany Mendez/Reporting Texas

Operating A Gambling Establishment Business

Although Texas poker rooms operate in a legal gray area, there is precedent for them elsewhere. California card houses that operate the same way are legally recognized by the state. Colorado, Florida, Minnesota, Montana and Washington also have card houses, but no other states do, according to the American Gaming Association's 2018 State of the States report.

Not everyone agrees that membership-based gambling house are legal.

One of the naysayers is Rob Kohler, a consultant and lobbyist for the Texas Baptist Christian Life Commission.

'It would require a constitutional amendment to make commercial gambling legal in Texas,' Kohler said. 'Private home gambling is legal, but these poker rooms are not that. They are merely hiding as a private establishment, but in reality they are commercial.'

Rodger Weems, chairman of Texans Against Gambling, argued in a 2018 Baptist Standard article that card houses run afoul of the law. According to Texans Against Gambling's website, its mission is to 'Improve the lives of people by freeing them from the lower standard of living, exploitation, and fraud that commercial gambling spreads.'

Justin Northcutt, co-owner of the Texas Card House, says Kohler and Weems are playing a bad hand.

'We work very closely with state and local officials and law enforcement to make sure they know how we do business,' Northcutt said. The business pays sales taxes, payroll taxes and its share of property taxes, he said. Northcutt declined to say how much it pays.

'It's not a dark, hidden, dangerous underground place,' he said.

The appeal of membership-based card houses isn't gambling, but the skill and challenge of poker, he added.

Poker dealer Delia Atwood collects poker chips at her table during a tournament for the Social Card Clubs of Texas, a non-profit formed in 2018 for social clubs and card playing enthusiasts, at the Texas Card House in Austin on March 2, 2019. Brittany Mendez/Reporting Texas

Mike Robinson, a Wesleyan University psychology professor, has been studying gambling addiction for a decade and a half through experiments on rodents.

'We haven't gotten the rodents to play poker, but the idea is the same,' Robinson said. Success in gambling — winning or almost winning a hand in a poker game, for example — activates the brain's reward system, and addicts keep gambling in an attempt to reactivate those pathways.

Texas Card House revokes or bans members that show gambling addiction or bad behavior, Northcutt said, and the business is a part of the Social Card Clubs of Texas, a non-profit formed in 2018 that seeks to promote responsible card playing and create better communities.

Kohler, of the Texas Baptist Christian Life Commission, doubts the validity of these claims. He and the Christian Life Commission want to explicitly outlaw card houses, but since the Attorney General's Office has refused to offer an opinion on the matter, the fate of these establishments is in the hands of local law enforcement.

Law enforcement across the state has been mostly tolerant, but in 2017, CJ's Card Room in Dallas was raided by police and effectively shut down. Anti-gambling proponents such as Texas Against Gambling have called for law enforcement to continue raids.

Will said the risk of a police raid doesn't bother him. 'I don't think most people will either,' he said. 'It won't matter because people will still find a way to play.'

Landis business owner charged with operating illegal gambling establishment

Published 11:10 am Tuesday, May 12, 2020

LANDIS — A Landis business owner was charged Tuesday with offenses related to operating a gambling establishment after a monthlong investigation by the Rowan County Sheriff's Office.

Jack Lewis Faggart Jr., 59, of China Grove, was charged with two counts of operating/possessing a slot machine, permitting the use of a slot machine at a location under his management or control, possessing gaming machines that allowed the machines to exceed the limits of eight accumulated credits or replays and operating more than five video gaming machines.

Faggart, the owner of Snack Shack, was operating under the guise of being a convenience store/landscaping supply business in Landis, the sheriff's office said.

The sheriff's office served a search warrant April 16 at the business, located at 3125 North Cannon Blvd.

The search warrant was based on an undercover operation and citizen complaints that the business was a gambling establishment and also violating the governor's stay-at-home order, according to the sheriff's office.

The investigation showed that the Snack Shack had 19 gambling machines, all slot machines, a news release said. These gaming machines operated with several types of software. Officials said 13 machines had money receivers and some still had currency in them. The machines allowed patrons to bet more than eight credits, which violates state law. The business allegedly was paying cash for winnings, another violation of state law.

During the search of the business, detectives seized six central processing units connected to gaming terminals, three motherboards, one server, documents and $11,343 in cash. Records showed that the gaming machines were taking in more than $10,000 per week and profiting multiple thousands of dollars per week, a news release said.

On Tuesday, April 28, additional search warrants were executed by the Rowan County Sheriff's Office at the Snack Shack and a second location. Investigators seized documents and an additional $13,920 in cash.

At the time of the execution of the search warrants on April 28, Faggart was also cited for violating the governor's executive order.

Faggart was released on a written promise.

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A tournament takes place at Texas Card House in Austin on March 2, 2019. Brittany Mendez/Reporting Texas

Operating A Gambling Establishment Business

Although Texas poker rooms operate in a legal gray area, there is precedent for them elsewhere. California card houses that operate the same way are legally recognized by the state. Colorado, Florida, Minnesota, Montana and Washington also have card houses, but no other states do, according to the American Gaming Association's 2018 State of the States report.

Not everyone agrees that membership-based gambling house are legal.

One of the naysayers is Rob Kohler, a consultant and lobbyist for the Texas Baptist Christian Life Commission.

'It would require a constitutional amendment to make commercial gambling legal in Texas,' Kohler said. 'Private home gambling is legal, but these poker rooms are not that. They are merely hiding as a private establishment, but in reality they are commercial.'

Rodger Weems, chairman of Texans Against Gambling, argued in a 2018 Baptist Standard article that card houses run afoul of the law. According to Texans Against Gambling's website, its mission is to 'Improve the lives of people by freeing them from the lower standard of living, exploitation, and fraud that commercial gambling spreads.'

Justin Northcutt, co-owner of the Texas Card House, says Kohler and Weems are playing a bad hand.

'We work very closely with state and local officials and law enforcement to make sure they know how we do business,' Northcutt said. The business pays sales taxes, payroll taxes and its share of property taxes, he said. Northcutt declined to say how much it pays.

'It's not a dark, hidden, dangerous underground place,' he said.

The appeal of membership-based card houses isn't gambling, but the skill and challenge of poker, he added.

Poker dealer Delia Atwood collects poker chips at her table during a tournament for the Social Card Clubs of Texas, a non-profit formed in 2018 for social clubs and card playing enthusiasts, at the Texas Card House in Austin on March 2, 2019. Brittany Mendez/Reporting Texas

Mike Robinson, a Wesleyan University psychology professor, has been studying gambling addiction for a decade and a half through experiments on rodents.

'We haven't gotten the rodents to play poker, but the idea is the same,' Robinson said. Success in gambling — winning or almost winning a hand in a poker game, for example — activates the brain's reward system, and addicts keep gambling in an attempt to reactivate those pathways.

Texas Card House revokes or bans members that show gambling addiction or bad behavior, Northcutt said, and the business is a part of the Social Card Clubs of Texas, a non-profit formed in 2018 that seeks to promote responsible card playing and create better communities.

Kohler, of the Texas Baptist Christian Life Commission, doubts the validity of these claims. He and the Christian Life Commission want to explicitly outlaw card houses, but since the Attorney General's Office has refused to offer an opinion on the matter, the fate of these establishments is in the hands of local law enforcement.

Law enforcement across the state has been mostly tolerant, but in 2017, CJ's Card Room in Dallas was raided by police and effectively shut down. Anti-gambling proponents such as Texas Against Gambling have called for law enforcement to continue raids.

Will said the risk of a police raid doesn't bother him. 'I don't think most people will either,' he said. 'It won't matter because people will still find a way to play.'

Landis business owner charged with operating illegal gambling establishment

Published 11:10 am Tuesday, May 12, 2020

LANDIS — A Landis business owner was charged Tuesday with offenses related to operating a gambling establishment after a monthlong investigation by the Rowan County Sheriff's Office.

Jack Lewis Faggart Jr., 59, of China Grove, was charged with two counts of operating/possessing a slot machine, permitting the use of a slot machine at a location under his management or control, possessing gaming machines that allowed the machines to exceed the limits of eight accumulated credits or replays and operating more than five video gaming machines.

Faggart, the owner of Snack Shack, was operating under the guise of being a convenience store/landscaping supply business in Landis, the sheriff's office said.

The sheriff's office served a search warrant April 16 at the business, located at 3125 North Cannon Blvd.

The search warrant was based on an undercover operation and citizen complaints that the business was a gambling establishment and also violating the governor's stay-at-home order, according to the sheriff's office.

The investigation showed that the Snack Shack had 19 gambling machines, all slot machines, a news release said. These gaming machines operated with several types of software. Officials said 13 machines had money receivers and some still had currency in them. The machines allowed patrons to bet more than eight credits, which violates state law. The business allegedly was paying cash for winnings, another violation of state law.

During the search of the business, detectives seized six central processing units connected to gaming terminals, three motherboards, one server, documents and $11,343 in cash. Records showed that the gaming machines were taking in more than $10,000 per week and profiting multiple thousands of dollars per week, a news release said.

On Tuesday, April 28, additional search warrants were executed by the Rowan County Sheriff's Office at the Snack Shack and a second location. Investigators seized documents and an additional $13,920 in cash.

At the time of the execution of the search warrants on April 28, Faggart was also cited for violating the governor's executive order.

Faggart was released on a written promise.

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By Carl Blankenship carl.blankenship@salisburypost.com SALISBURY — Most high school students still want in-person graduation ceremonies when state orders regarding gathering... read more

Comments

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