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Unregulated high-stakes gambling grows on American Indian reservations

New forms of unregulated gambling are proliferating on Indian reservations across the United States, according to a California state prosecutor involved in a three-year battle to restrict the growth of professional high-stakes bingo games run by Indian tribes. He warns that unless states are given authority to police and in some cases shut down the operations, the US may soon be faced with the development of dozens of miniature gambling towns on Indian reservations in as many as 20 states.

``They are trying to create little Los Vegases on reservations across the nation,'' says Rudulf Corona, a deputy attorney general in San Diego.

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``These kinds of endeavors that are unregulated and shielded from view are highly attractive to organized crime,'' he adds.

Mr. Corona is one of a handful of state law-enforcement officials, largely in the West, who are concerned about the proliferation of large-scale bingo operations on federal Indian reservations.

According to the Bureau of Indian Affairs, 75 to 80 of the country's 300 Indian tribes have established high-stakes bingo halls in the past four years.

Federal courts have consistently ruled that state governments do not have the authority to restrict or even monitor the Indian bingo parlors, provided that they do not violate criminal laws. Bingo is regulated by states under civil statutes.

In some cases the Indian bingo games offer in excess of $100,000 in prizes, while some states restrict bingo prizes to as little as $250. Church and charity bingo groups, which are state-regulated, are worried they may lose their clientele to the higher stakes games on the reservations. But the Indians reply that ultimately their games will lure more novice players into the bingo halls and thus create a larger pool of bingo players for all to share.

On May 4, tribes in Florida, California, and Washington State are planning to conduct a $1 million bingo game -- the largest ever -- by using satellite transmission to broadcast the action live to three of the tribes' bingo parlors. Some 4,300 bingo enthusiasts are expected to pay from $250 to $300 to participate in the six-hour session.

``We view it as a severe threat to the state,'' Corona says. The $1 million bingo game is ``a dramatic escalation in the gambling that is taking place on these reservations,'' he says.

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``If these kinds of activities are allowed to go unchecked, then we may face some day nationally broadcast games that involve each and every state.''

He adds that the Indians often sign lucrative contracts with management and investment firms specializing in opening and running big-money bingo halls. Last year the Sycuan Indians with the help of a Florida management firm expanded their bingo operation near San Diego to include Black Jack, Keano, and an illegal lottery. They attempted to circumvent state authorities by simply renaming the games ``Bingo Jack,'' ``Do-it-yourself Bingo,'' and ``Horserace Bingo.''

The operation was busted up in an August raid. In addition to $300,000 in illicit gaming equipment, police confiscated information announcing the expected arrival soon of ``Bingo roulette,'' and ``Bingo slot machines.''

The raid was a minor setback for the Sycuans, who are still going strong in the bingo business. The tribe -- along with the Muckleshoot tribe of Washington State and the Seminoles of Florida -- is participating in the May 4 million-dollar satellite bingo session.

High-stakes professional Indian bingo got its first major boost in 1981, when a federal judge in Florida ruled that the Seminole tribe was entitled to run its big-money bingo game in Hollywood, Fla., without interference from the state.

The ruling said in effect that because the game is conducted by the Indians on their reservation, it is up to the Indians themselves to regulate and monitor the conduct of the gambling operation. Indian tribal reservation land is recognized by the US government as being a sovereign nation within a nation.

Tribes across the country have viewed the Seminole experience as a model. The 725-member Muckleshoot tribe went so far as to sign a contract with the Seminoles to have them build and manage the 1,450-seat Muckleshoot Bingo Palace near Auburn, Wash.

The contract terms are lucrative for the Seminoles. In addition to paying back a $2.3 million construction loan -- including interest at the prime interest rate -- the management contract requires the Muckleshoots to pay the Seminoles 44 percent of their profits until 1995.

Tony Herrara, business manager for the Muckleshoots, is quick to point out that he didn't do the negotiating for the tribe. But he adds: ``Sure we'd like [the Seminoles] to get less of a percentage, but they are providing a lot, too. We didn't have the expertise or money to build the bingo hall.''

He adds that before the arrival of bingo the unemployment rate on the reservation was 65 percent, and that today 160 Indians have jobs in the Bingo Palace.

Bingo has been seen by Indians nationwide as a means to raise much-needed revenue and create jobs on some Indian reservations that have been notable in the past only for their poverty and high unemployment. In most cases tribes are looking to bingo to provide seed money to fund social programs, pave roads, and create a viable Indian economy on reservations where none existed before.

There have been several significant successes, according to some observers.

``Bingo is the growth industry of the Indian country,'' says a spokesman at the Bureau of Indian Affairs in Washington. ``The federal government is cutting back on its domestic programs, and the tribes out there have been feeling the pinch in federal dollars. For some, the bingo has made the pinch less pinchy.''

Because of the apparent benefits of bingo revenues, some officials have been reluctant to impose any restrictions on the bingo operations. Others, concerned that the tribes might become victims of unscrupulous bingo management firms and organized crime, have pushed to set up federal safeguards, such as requirement that background criminal checks be conducted by the Federal Bureau of Investigation into people running or financing the bingo parlors.

Still others, such as Corona in California, have felt that the best response would be to require the reservations to comply with state bingo regulations. This last response would cut deeply into Indian bingo profits and probably drive many of the operations out of business.

In the meantime, preparations are under way at the Muckleshoot Bingo Palace, Seminole Bingo in Tampa, Fla., and the Sycuan Reservation near San Diego for the May 4 million-dollar bingo session.

California and Washington law-enforcement officials say they will not try to stop the event, even though officials in both states consider the Indian bingo operations to be in violation of the law.

Asked about the $1 million satellite bingo session, Corona responded: ``Is it legal? No, it is not.''

He added, ``The question is whether the federal government wants to do anything about it.''

Federal regulations outlaw interstate transmission of lottery or gambling information, Corona says. He adds that the Organized Crime Control Act of 1970 forbids gambling on federal lands. Indian reservations, he says, are federal lands.

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