Mich. AG sues Internet cafes

Bryan Cohen Apr. 9, 2012, 1:55pm


LANSING, Mich. (Legal Newsline) - Michigan Attorney General Bill Schuette announced formal cease and desist orders on Monday against three Internet sweepstakes cafes in mid-Michigan warning of possible legal action over allegedly illegal gambling operations.

The warning correspondences were sent to Cyber Cafe in Holt, Lansing Business Center in Lansing and Flint Business Center in Flint. The letters, issued by Schuette's Alcohol & Gambling Enforcement Division, warn the cafes that their operations violate state gaming laws.

The letters came after Schuette's office looked into the establishments with the help of the Michigan Gaming Control Board and the Michigan State Police.

"Communities across Michigan are concerned about activities happening at many so-called 'Internet sweepstakes cafes'," Schuette said. "If evidence of illegal gaming is uncovered at these cafes or elsewhere, we will with work with the Michigan State Police and the Michigan Gaming Control Board to shut them down."

The three Internet sweepstakes cafes that were targeted by Schuette's letters are businesses that sell Internet access and the opportunity to play computer-based casino-style games where customers are able to win cash prizes. Some of the businesses also serve food and drink, such as soda and chips, to the patrons.

Each purchase by a consumer entitles him or her to a specific number of entries into a sweepstakes. The customer then has the ability to unveil whether the sweepstakes entries are winners using a computer monitor that activates a spinning wheel, similar to a casino-style video slot machine. Schuette alleges that using the gaming system is in violation of the Michigan Gaming Control and Revenue Act.

If the three businesses fail to cease their allegedly illegal gambling operations within 14 days, Schuette may take legal action, which may include criminal charges or the filing of a civil action.

The Michigan Gaming Control and Revenue Act and Michigan's Penal Code strictly prohibit gambling that is unregulated. The only gambling activities that are authorized under state law include bingo, pari-mutuel horse racing, certain charity events, the state-sponsored lottery, and Michigan Gaming Control and Revenue Act-licensed casino gambling.

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