Colorado Springs

Slots Or Not? - Part 2

Slots Or Not- Part 2

COLORADO SPRINGS, Co. - Despite a lack of success prosecuting owners of arcades offering "skill games", the arcades continue to be raided across Colorado for allegedly violating state gambling laws.

Unlike traditional slot machines based solely on chance, skill games allow the player to influence the outcome through their abilities.

Arcade owners believe that difference makes them legal.

However, the Colorado Bureau of Investigation believes the machines operate the same way as slot machines, and therefore considers them to be in the same category, and in Colorado, slot machines and other forms of limited gaming are only legal in the towns of Cripple Creek, Blackhawk, and Central City.

As a result, skill games arcades have become a frequent target for raids and seizures by law enforcement.

Charlie Chedda's on S. Academy in Colorado Springs was among the first to be raided back in August of 2015.

"They came in, and it looked like full SWAT gear on with the body armor on and things like that," recalls owner Trey Franzoy.

Denver arcade owner Tammy Garamova was raided in October of 2017.

"The detective in charge told me that he would hate to see me reopen so that he could come back and take all of our machines again," she said.

And while the machines and the money are taken over and over, not to be returned, the state has had no success prosecuting the owners.

"There have been no arrests, certainly no convictions, and the government has not won in court," says Chris Howes, Executive Director of the Colorado Skill Games and Entertainment Association.

Frustrated over the ongoing raids, the Association submitted an open records request last fall to the CBI and other agencies, seeking to find out whether there is collusion between law enforcement and the state's big casinos, with the casinos leaning on law enforcement to take out the perceived competition.

Howes admits that while they have not come across any "smoking gun" in their request that confirm that big casinos are working directly with law enforcement, there is plenty of questionable communication.

"The amount of collaboration that's going on between the government and law enforcement and the casinos is alarming to us," he said.

However, the Executive Director of the Colorado Gaming Association, which represents casino interest, denies any collusion.

"The association doesn't have any ability to pursue prosecution," said Peggi O'Keefe.

KRDO Newschannel 13 looked into the Colorado Division of Gaming statistics for casinos, that include revenue figures for Cripple Creek. 

Adjusted gross proceeds peaked in 2007 at $154.9M, but dropped for 7 consecutive years after that to a low of $123.4M in 2014, before recovering slightly to $134.7M last year.

Casino employment in Cripple Creek has declined also.

Click here to view employment figures on Page 21.

In July of 2013, the Cripple Creek casino industry employed 3,296 workers.

Three years later, that number was only 1,846.

2017 data was not available yet.

O'Keefe attributes the declines to factors out of their control.

"If the economy is doing poorly, it's less likely that folks are going to come up, and of course we are also susceptible to the weather and to other factors that are going on," she said.

Although they declined to be interviewed on camera, Newschannel 13 spoke with three casino general managers over the phone.

They said they aren't worried about skill games currently impacting their business, but they believe the machines are illegal and felt there is a potential impact if the arcades are allowed to expand unchecked.

As of this week, at least four casinos in Cripple Creek have plans to expand their hotels.

The expansion suggests that plenty of gamers with plenty of money to spend  are just fine with relying on plain old luck, rather than their skills.

Click to watch "Slots Or Not? - Part 1".

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