Slot Machine Raids Looked Like a Jackpot --but <i> TILT!</i>

About this time last year, I was crouched behind a bank of video slot machines in a darkened warehouse in Laguna Hills, half expecting a band of gangsters toting assault rifles to burst through the door.

Eventually, several unarmed men showed up and were arrested by Orange County sheriff’s deputies without a scuffle. More anticlimaxes were to follow.

The stakeout was part of a wide-ranging police raid on a gambling ring that had set up illegal video slot machines in Asian neighborhoods from Rosemead to Garden Grove. In all, 79 illegal machines were seized, and eventually 11 men were arrested.

Three suspects were arrested at a luxury apartment in Costa Mesa, where police found weapons in every room, including shotguns, pistols, an Army vest stuffed with ammunition and a loaded assault rifle, found under a bed.

“Some of this stuff is overkill for the neighborhood,” Westminster Police Detective Terry Selinske said at the time.

Police said detailed ledgers and financial records seized in the raid showed that the gambling operation had grossed $400,000 in a single month and was funneling at least part of the profits to the East Coast. One ledger neatly noted that $231,000 had been “paid to New York.”

The machines had been shipped from a New Jersey company.

It was, without doubt, a story with sex appeal.

But police refused to say much about whether the alleged San Clemente-based ring had organized crime connections in New Jersey.

The company was “not about to ship $65,000 worth of machines to anybody unless they know them,” said Los Angeles Police Detective Carl Olson, who helped organize the sweep. “This is a long way from New Jersey.”

Frankly, I thought the police had the case nailed. One of the suspects, Michael Spain, was videotaped boasting to an undercover officer that merchants who had installed the machines in bars, pool halls and coffee shops were making up to $2,000 per machine per week.

“We’ve got them all over the United States,” Spain said on the video. “Big, big business. We’re out of Vegas.”

But the case wasn’t as airtight as it seemed. The suspects’ attorney, Robert Dominick Coviello of Santa Ana, argued that the search warrant was flawed. A judge agreed, and despite protests from the district attorney, some of the most incriminating evidence was suppressed.

Three suspects, including Spain, ended up pleading guilty to conspiracy to operate slot machines, a felony, Deputy Dist. Atty. James Joseph Mulgrew said. They were each fined $1,000 and placed on probation.

Six more men pleaded guilty to misdemeanor gambling charges and also received fines and probation.

“Nobody’s doing any jail time,” Coviello said.

I began to feel guilty. Had I overplayed the story?

“I was a little bit concerned,” Coviello said, “about the fact that the press made such a big story of the matter and led the public to believe it was really a grievous offense, when in actuality you’re talking about gambling devices that the public was willing to use.

“The amount of time (police) put into the investigation was unjustified and not proportional to the offense.”

Not so, prosecutor Mulgrew said: “The police did invest significant man-hours investigating this and taking the business down. I don’t think that was a poor investment. This was a large-scale operation, and blatant, and not the kind of thing we can allow to get a foothold in the community.”

Mulgrew acknowledged that the suppression of evidence hurt his case but noted that two other suspects, William Lee and Thomas Fahey, have yet to stand trial on charges of conspiracy to operate slot machines. They will appear before a different judge, and Mulgrew will fight to keep the evidence from being suppressed again.

This week, I made a few more phone calls, and the story took a new twist.

It turns out that Fahey has since been charged in a violent assault in Seattle and that both Fahey and another man who pleaded guilty in the Orange County case, Michael Wall, were arrested in January on suspicion of setting up the same kind of gambling ring in Seattle, where 20 video poker machines were seized, Seattle Detective Fred Still said.

And in New Jersey, the chief executive officer of the company that shipped the machines was indicted on conspiracy and racketeering charges in March, said Chuck Davis, spokesman for the New Jersey attorney general.

The indictment alleges that the firm, Greyhound Electronics Inc. of Toms River, was controlled by the Bruno Scarfo organized crime family from New Jersey and Philadelphia. Scarfo is in federal prison for life, but his son is accused of setting up similar video poker distribution rings in New Jersey, Pennsylvania, Florida and Ohio, Davis said.

Wall and Fahey were not named in the indictment. But stay tuned.