News and Press Releases

Slot Machine Mechanic Pleads Guilty to Tax Evasion

April 12, 2005

Reno, Nev. - A man who serviced slot machines in the Reno/Sparks area pleaded guilty today to evading over $40,000 in federal income taxes over a three-year period, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

PAUL JAMES ARNY, of Reno, pleaded guilty before U.S. District Judge Edward C. Reed to one count of Evasion of Income Tax, a federal felony offense. Although ARNY entered a guilty plea to the evasion of income tax for the calendar year 2000, the specific conduct outlined in the plea memorandum to which he pleaded guilty covers the evasion of income taxes for the years 1999 through 2001.

According to the plea memorandum, ARNY admitted that during the calendar years 1999 through 2001, he worked as a slot route mechanic for United Coin Machine Company and was responsible for maintaining, repairing and filling their slot machines at various sites throughout the Reno/Sparks area. ARNY was also responsible for filling the tills of the on-site change persons employed by United Coin Machine Company. The plea memorandum states that during that same period he earned additional income from three sources which he failed to report on his federal individual income tax return. That income was derived from money he earned working part-time as a slot route mechanic for another company; money he earned from remodeling homes; and money he embezzled from United Coin Machine Company by rigging various slot machines to pay accumulated credits, which was collected (with the help of others) by removing paper currency from slot machine bill validators, and by taking coins from the slot machine hoppers or fill bags.

According to the plea memorandum, the total income ARNY failed to report for all three years is $159,218, and the total tax loss to the government is $42,144.

PAUL ARNY faces up to five years in prison and a $250,000 fine. He is free on bond pending sentencing, which is scheduled for August 22, 2005 at 1:30 p.m.

The case is being investigated by IRS Criminal Investigation Division, and prosecuted by Assistant United States Attorney Brian Sullivan.

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