Without Wampum, Indians Bank on Blackjack : Gambling: Call it the 'Revenge of the Pequots' as tribal coffers are flush with proceeds from the casino.


Think of gambling chips as modern-day wampum.

Once, the Pequot Indians used wampum--clamshell beads--as currency. That was 3 1/2 centuries ago, before the tribe was massacred and dispersed, before their tribal world was restricted to the reservation.

But in 1992, the world beats a path to the Pequots' gate.

Every day, upward of 12,000 gamblers visit the Pequots' gleaming new gaming hall for poker, blackjack, off-track betting, craps, roulette, bingo. Every day, they exchange thousands of dollars for gambling chips.

Of course, some of those players get back their investment, and more. But not many; tribal coffers are flush with the casino's proceeds.

Call it the Revenge of the Pequots.

"Wampum had no inherent value but gave them an opportunity to become traders. We take money and give you entertainment," said Albert Luciani, former chief executive officer of the Foxwoods High Stakes Bingo & Casino for the Mashantucket Pequot tribe.

Foxwoods' success is being duplicated across the country, as Indians build mini Las Vegases everywhere.

There was no big-league Indian gambling in 1979. Today, it is a $5.4-billion-a-year industry, according to International Gaming & Wagering Business magazine--the fastest growing segment of the nation's $304-billion-a-year betting habit.

About 160 of the nation's 314 tribes run games from bingo to blackjack, and Indians operate more than 40 full-fledged casinos in 12 states.

Some Indians call gambling the "new buffalo" because it feeds, clothes and shelters them while improving the quality of life on reservations--those out-of-the-way patches rife with alcoholism, joblessness and despair.

Nobody objects to Indian prosperity, but some fear that their casinos will fall prey to the mob. And what if states, eager to increase revenues, legalize gambling--and the tribes suddenly face competitors that are less remote? The tribes could wind up paying mortgages on gaming halls without patrons.

Mindful of the competition, Indians hope to create destination resorts to attract customers to their faraway locales.

"It's an economic footrace," said Suzanne Harjo of the Morningstar Foundation. "There is a risk, but that's business. If you're making money, someone else is always trying to come up with a better mousetrap."

Foxwoods is certainly out of the way; it is located off a two-lane road in the backwoods of southeastern Connecticut. But with the nearest competition about 250 miles away, in Atlantic City, the casino has prospered.

Operators expect to gross more than $100 million a year--more than initial projections, but how much more no one is saying. It has never closed since it opened Feb. 15. The demand for play is so great that there can be a waiting period of hours to get a table seat. And in July, the 263-member tribe announced a $142-million expansion for a resort complex.

The casino has an indoor waterfall, a museum room and huge windows looking out to the New England countryside.

With their gambling profits--which are exempt from federal taxes--the tribe has bought back its ancient lands, financed archeological digs, restored burial grounds, created thousands of jobs, set up college scholarships and paid for fire, police and medical costs. It has a $60 million-a-year annual payroll in a state hit hard by a sour economy.

Not bad for a tribe whose former cottage industry was making baskets, and less than 20 years ago, was down to 55 members and 214 acres, a fraction of the 3,000 acres reserved for them by the British in 1667.

Other tribes have had gaming success, as well. In Minnesota, the Shakopee Mdewakanton Sioux in May opened a dazzling new casino 30 miles from Minneapolis, and its central symbol is the buffalo--the mainstay of the Plains Indian culture.

"This new buffalo makes us strong again. There's never been an economic development program as successful as this one," said tribal chairman Leonard Prescott.

Unemployment has gone from 60% to zero. The tribe has paid for new housing, sewers and roads while giving its members monthly dividend checks, college scholarships and trust funds.

The Mille Lacs Band of Ojibwe Indians cashed in too. After their casino opened in 1991, the Minnesota tribe eliminated its 45% unemployment rate and slashed its 60% poverty rate.

The Bureau of Indian Affairs, which annually administers $2 billion of federal aid to the tribes, endorses gambling as an economic opportunity.

Is it an opportunity for organized crime, as well? In January, John (No Nose) DiFronzo and Samuel Carlisi--reputedly the current and former street bosses of the Chicago syndicate--were among those charged with plotting to skim money from a Rincon Reservation gambling hall in San Diego County, Calif.

And Stewart Siegal, former manager of a bingo hall at the Barona Indian Rservation, also in San Diego County, told a Senate committee in 1989 that he rigged games and skimmed money.

"Anytime there's easy money, the mob will jump in," said Siegal, who pleaded guilty and was sentenced to a year in jail.

But the U.S. Justice Department said there are "fewer than five" investigations nationwide into illegal activity on reservations.

"The perception in the media and elsewhere that Indian gaming operations are rife with serious criminality does not stand up under close examination," Paul L. Maloney of the Justice Department's criminal division told Congress earlier this year.

If gambling seems an unsavory business, Indians say it pales next to their social woes--alcoholism is 663% greater than the national rate, suicides are 95% higher and unemployment is more than double.

"Most tribes would rather be engaged in other economic pursuits. It's more out of desperation than anything else that many have turned to gaming. The grim reality is it's one of the few revenue sources they have," said Eric Eberhard, minority counsel for the Senate Select Committee on Indian Affairs.

Or in the words of Anthony Hope, chairman of the National Indian Gaming Commission: "If you're going to bootstrap yourself, the first thing you need is a pair of boots."

Because they have signed treaties with Washington, Indian tribes are like sovereign governments who make their own laws and are exempt from state regulations and taxes. Courts have agreed that state laws related to gaming could not be enforced against Indians.

Because Connecticut allows churches to raise money with "Las Vegas nights," courts allowed the Pequots to open a casino.

Congress attempted to control things with the 1988 Indian Gaming Regulatory Act. It said that tribes must negotiate compacts with states before they open casinos, and the Indians could sue if states didn't negotiate in good faith.

But Alabama, among other states, argued that the 11th Amendment gives them immunity from lawsuits, so they refuse to negotiate.

All of this means Congress is likely to tighten and clarify the law. U.S. Rep. Peter Hoagland (D-Neb.) has already introduced a bill. And Sen. Harry Reid (D-Nev.), the main author of the 1988 law, also said Congress would act this year "to assure the law is fairly and strictly enforced." As a Nevadan, Reid knows that state's casinos compete with Indian gambling.

Many expect the rules to be different.

"The window of opportunity on Indian gambling is about to be slammed shut. Congress never intended for there to be casinos in Connecticut and it is embarrassed," said I. Nelson Rose, a professor at Whittier College and a consultant on Indian gambling.

A group called the Coalition to Protect Community and States' Rights said Indians have unfair advantages because they pay no taxes on profits, have looser regulations and are allowed to advertise.

But to protect their rights, Indians vow to fight--using such nontraditional weapons as public relations and lobbyists.

"It's the new Indian war. We can't afford to lose this one," said Charles Keechi, chief of the Delaware Nation in Anadarko, Okla. "I think gaming is the road to economic independence. We have to follow it we are to survive."

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