A $300 million fraud may lead to the banning of Internet cafes.
Florida is reeling from a gambling scandal involving hundreds of millions of dollars, which has led to dozens of arrests and the resignation of the state’s lieutenant governor. In what has to be one of the largest, simplest and most clever frauds in recent memory, a large nonprofit organization turned a network of Internet cafes into virtual casinos. Now Florida’s legislature wants to make all Internet cafes illegal. If other state legislatures follow, the ripple effect could affect many other small-business owners who run cafes that offer Internet access.
According to law enforcement reports, the nonprofit organization Allied Veterans of the World (AVW) based in Oklahoma owns a network of Internet cafes where customers could gamble online at a website controlled by the organization and were allowed to cash out at the cafes after each session. The scheme netted AVW around $300 million in only four years. The technology to execute the scheme was provided by International Internet Technologies, which is currently under investigation. Florida police shut down 49 Internet cafes on March 12.
AVW made over $2 million in political contributions while running the scheme, and now politicians across the country are frantically reviewing any donations received in an attempt to refund them and distance themselves from the organization.
