For Immediate Release - June 07, 2013

Chicopee Internet Café Owner, Corporation Plead Guilty to Operating an Illegal Slot Parlor

Ordered to Forfeit More Than $250,000 in Assets

SPRINGFIELD - The owner of “Cafeno’s” Internet café in Chicopee and his corporation have pleaded guilty to charges of operating an illegal slot parlor, Attorney General Martha Coakley announced today.  

Steven Sheldon, 49, of Westfield, pleaded guilty today in Hampden Superior Court to charges of organizing or promoting gambling services, operating an illegal lottery, allowing lotteries in a building and the sale and advertising of lottery tickets. The corporation, Cafeno’s Inc., pleaded guilty to the same charges, as well as to charges of aiding, assisting, procuring, counseling or advising a false tax return.

After the pleas were entered, Judge Constance Sweeney sentenced each defendant to two years of probation. As a condition of the plea, Judge Sweeney ordered that more than $250,000 of the defendants’ assets be forfeited to the Commonwealth, $100,000 of which will be forfeited by the corporation as a fine for falsifying state tax returns.

“This defendant and his corporation are being held accountable for running an illegal, unregulated slot parlor in direct violation of Massachusetts law,” said AG Coakley. “Our state gambling laws are intended to prevent these kinds of operations that are nothing more than fronts for thinly disguised illegal gambling.”

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.

In September 2010, the Attorney General’s Office began an investigation into “Cafeno’s” in Chicopee. Evidence gathered during the course of the investigation revealed that patrons of this Internet café were paying nearly exclusively for the right to gamble. The patrons were not, as suggested by the operator, simply paying for Internet time and playing a free sweepstakes. Further, “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.

Additional investigation into the business dealings of Cafeno’s after the original indictments revealed falsified state tax returns. 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.  

A Statewide Grand Jury returned indictments against Cafeno’s, Sheldon, and his business partner, Stephen Megliola, in November 2011. All the defendants were arraigned in Hampden Superior Court in January 2012. Sheldon and Cafeno’s pleaded guilty and were sentenced today. The case against Megliola is pending.

This action by the AG's Office is a direct result of complaints regarding alleged unlawful gambling operations. The AG’s office issued permanent civil regulations in June 2011 under the Massachusetts Consumer Protection Act. The Act bans the operation of so called “cyber cafés” and similar establishments across the Commonwealth. Those that violate the law may be subject to injunctions, criminal charges, civil penalties and other relief under the Consumer Protection Act.

Additionally, in August 2012, Governor Deval Patrick signed into law legislation that further enhances the criminal penalties for illegal gambling at “cyber cafés” throughout Massachusetts. The new law has gone into effect and establishes a new crime for conducting or promoting an unauthorized sweepstakes that is executed through the use of the display of an electronic machine. The new crime carries a penalty of up to $250,000 per offending machine and/or imprisonment of up to 15 years in state prison.

In May 2013, the owners of an Internet café in Revere were indicted, along with their corporation, on charges of operating an illegal slot parlor. In August 2012, two individuals and their corporation pleaded guilty to gaming charges in connection with operations out of Internet cafés in Fall River and Fairhaven.

The case was handled 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, Department of Revenue Investigator Thomas Nowicki, and State Police assigned to the Attorney General’s Office assisted in the investigation.

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