Nick’s Amusements Pleads Guilty to Money Laundering; Ordered to Pay a $50,000 Fine
Company Previously Forfeited $1 Million In A Civil Settlement
Baltimore, Maryland - Nick’s Amusements Inc., of Baltimore County, Maryland, pleaded guilty today to money laundering related to the operation of an illegal gambling business and U.S. District Judge J. Frederick Motz ordered the company to pay a $50,000 fine. In a related civil settlement filed earlier this year, Nick’s Amusements agreed to forfeit $1 million, alleged to be the proceeds of an illegal gambling business.
The guilty plea and sentence were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Rebecca Sparkman of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Chief James W. Johnson of the Baltimore County Police Department.
According to the plea agreement, from April 2003 through December 2008, Nick’s Amusements placed a number of slot machines in bars and restaurants in Baltimore County and other locations. Customers operated the slot machines by placing money in the machine. Each machine awarded points to the customers playing the machines, which would be displayed on the video screen of the machine. When the customer/player was finished playing, an employee of the restaurant or bar would pay the customer/player $.05 for each point, then returned the points to zero. Nick’s Amusements employees went to the bars and restaurants weekly to remove the cash from the machines, reimburse the bar and restaurant owners for the cash paid to the customers/players during the week. By prior arrangement, the remainder of the cash was split between the bar/restaurant owners and Nick’s Amusements. The operation of the slot machines in this manner constituted an illegal gambling business under Maryland law.
A Nick’s Amusements employee took the Nick’s Amusements portion of the cash proceeds from the slot machines and deposited them into a company account. The funds were then wired to other accounts, including a $35,000 transfer on December 15, 2006, which according to company records was a loan made to a separate entity.
As part of the plea agreement, Nick’s Amusements has agreed not to own, possess or operate any illegal slot machines.
United States Attorney Rod J. Rosenstein commended IRS-CI and the Baltimore County Police Department for their work in this investigation. Mr. Rosenstein thanked Assistant United States Attorney Richard C. Kay, who is prosecuting the case.