Chicopee Internet Café Owner and Corporation Indicted on Additional Charges in Connection with Operating an Illegal Slot Parlor
New Indictments Related to Falsifying State Tax Returns, Lottery Advertising
BOSTON - The owner of “Cafeno’s” Internet café in Chicopee and the corporation have been indicted on additional charges in connection with operating an illegal slot parlor, Attorney General Martha Coakley announced today. The new indictments are related to allegations of falsifying state tax returns and illegal lottery advertising.
Steven Sheldon, 48, of Westfield, was indicted on Monday by a Statewide Grand Jury on charges of aiding, assisting, procuring, counseling or advising a false return and advertising lottery tickets. The corporation, Cafeno’s Inc., faces the same charges.
“We allege that in addition to operating an illegal, unregulated slot parlor, this defendant also falsified state tax returns and promoted the lottery aspect of his business, in direct violation of state law,” AG Coakley said.
In January 2012, Sheldon, and his business partner Stephen Megliola, 42, of Longmeadow, were arraigned in Hampden Superior Court on charges of organizing or promoting gambling services and operating an illegal lottery. Sheldon was also arraigned on charges of allowing lotteries in a building and the sale and advertising of lottery tickets. Their corporation, Cafeno’s Inc., was arraigned on the same charges.
Under Massachusetts law, it is illegal to run or promote a gambling operation. The current gambling law in this case points to the existence of an illegal “lottery.” The definition of a lottery includes a payment to play, a prize, and some element of chance.
Additional investigation into the business dealings of Cafeno’s after the original indictments revealed that Sheldon falsified state tax returns. According to authorities, further evidence also indicated that radio advertising that promoted the lottery aspect of the business was purchased and aired by Cafeno’s, a violation of state law.
In September 2010, the Attorney General’s Office began an investigation into Cafeno’s in Chicopee. Evidence gathered during the course of the investigation demonstrated that patrons of this Internet café were paying nearly exclusively for the right to gamble. Authorities allege that patrons were not, as suggested by the operator, simply paying for Internet time and playing a free sweepstakes. Investigators also alleged that “no purchase required” opportunities were trivial and insignificant and gambling was the only clear purpose for these cafés. Cafeno’s ceased operation in March 2011.
A Special Statewide Grand Jury returned indictments against Sheldon and Megliola on November 10, 2011. On January 4, 2012, both were individually arraigned in Hampden Superior Court where each pleaded not guilty and were released on personal recognizance. A Statewide Grand Jury returned the additional indictments against Sheldon and Cafeno’s on March 26, 2012. Sheldon and Cafeno’s are expected to be arraigned on the additional charges in Hampden Superior Court at a later date. These charges are allegations, and the defendants are presumed innocent until proven guilty.
These actions taken by the Attorney General’s Office are a direct result of complaints regarding alleged unlawful gambling operations that have recently opened for business across the Commonwealth. While these businesses purport to sell goods or services, such as Internet access or phone cards, the Attorney General’s investigation found that those sales were a pretext for unlawful and unregulated lotteries, online slot parlors, sweepstakes, and similar gambling.
The Attorney General’s investigations into various Internet cafés throughout the Commonwealth remain ongoing.
The case is being prosecuted by Assistant Attorneys General Thomas Ralph and Timothy Wyse of the AG’s Cyber Crime Division, and AAG Lee Hettinger, Chief of the Western Massachusetts Regional Office. The Attorney General’s Computer Forensic Laboratory, Senior Financial Investigator Mark Pulli, and State Police assigned to the Attorney General’s Office all assisted in the investigation.