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Sting that led to Lt. Gov. Jennifer Carroll resignation fuels push for Internet cafe ban

by Dara Kam | March 13th, 2013

A federal gambling probe that led to the resignation of Lt. Gov. Jennifer Carroll last night may fuel support for a ban on the “casinos on the corner” after lawmakers have for years refused to act.

Carroll stepped down amid fallout from the investigation by the Internal Revenue Service, the Secret Service and other Florida law enforcement agencies into Allied Veterans of the World, a non-profit organization that operates dozens of internet cafes in Florida.

Allegations against Allied Veterans include money laundering, siphoning from a nonprofit for personal gain and misrepresenting the amount donated to charities. The IRS obtained search warrants to pursue the case from a federal judge in Oklahoma City.

Sen. John Thrasher, a St. Augustine Republican who called Carroll a long-time friend, said he intends to use the corruption probe to push for a ban on the Internet cafes. Thrasher, a former chairman of the Republican Party of Florida, has sponsored a measure that would place a moratorium on the cafes, but said this morning he wants the Legislature to move faster and go farther.

“Now I believe that the evidence has come out that indicates these things are exactly what we thought they were. They’ve been corrupted. There’s a problem with them. Counties and cities are having problems. Law enforcement people are having problems,” Thrasher told reporters.

Eight lobbyists who represent International Internet Technologies before the legisalture and governor’s office also withdrew their registration on Wednesday. IIT is a software company that is part of the investigation of Allied Veterans of the World. Lobbyist Sarah Bascom told The Palm Beach Post they had been “misled” by IIT.

Palm Beach County banned new Internet cafes from opening in unincorporated areas last year, and the West Palm Beach city commission moved forward with a moratorium this week. More than 1,000 of the cafes have popped up throughout the state. Cafe customers purchase Internet time, which they can use to browse the Web or play free “sweepstakes” games, in which computer credit or time is won. Those credits can be redeemed for cash.

Thrasher said Volusia County Ben Johnson, who will participate in a multi-law enforcement agency news conference regarding the sting later today, told him that officials had confiscated $50 million from Allied Veterans of the World and affiliated Internet cafes.

“These things are skimming things off. They’re not doing what they’re suggested to do. It’s a system where they have to go and justify their existence and I don’t think they can do that,” Thrasher said.

Thrasher refused to speculate about a possible replacement for Carroll but said her resignation may help Scott in his reelection bid.

“The governor now has to pick, frankly, somebody that he believes can help him in the campaign. So I think it will be a benefit to him, frankly, down the road,” he said.

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