A video poker vendor that attracted the attention of federal investigators last year has quietly pulled its machines from many locations in North Carolina.
Southland Amusement of Wilmington had 87 registered video poker machines in 66 locations in New Hanover County. But state officials, an industry representative and one of the company's customers said Southland began picking up its machines several weeks ago. The company's president, Robert Huckabee III, could not be reached for comment.
Steve Henderson, the North Carolina Amusement Machine Association's legislative committee chairman, said Huckabee may be removing the machines as part of a plan to sell the company.
"Some time ago, some folks were negotiating to buy his business," Henderson said.
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Mike Robertson, director of the state Alcohol Law Enforcement division, said the company has machines remaining only in convenience stores owned by Worsley Cos. of Wilmington. Company officials there could not be reached for comment.
"It's not because of any court action or enforcement action," Robertson said. "I think they just elected to move the machines out because of the ongoing investigations and controversy."
Southland's lawyer, Wade Smith of Raleigh, said the company is pulling out of North Carolina because the industry, while legal, does not find North Carolina as welcoming anymore.
"The industry is under intense scrutiny," Smith said. "There are a lot of allegations about the industry, and I think Bobby Huckabee felt it just wasn't a pleasant way to earn a livelihood."
Giving to politicians
Last year, Democracy North Carolina, a nonpartisan campaign watchdog, found that people connected with video poker had donated heavily to state politicians, particularly House Democratic Speaker Jim Black.
One of those donors, Pamela H. James, Huckabee's sister, at first denied making a $1,000 contribution to Black in a phone interview with The News & Observer, then said in a second phone interview that she had.
Another donor told The Charlotte Observer last year that she had given money to Southland that later may have shown up as a contribution to Black. It is illegal for companies to make campaign contributions or to make contributions by using the name of an individual.
Huckabee, the former chairman of the association's legislative committee, has given more than $30,000 to state politicians in the past few years.
After the news reports, the FBI confirmed in June that it was interviewing donors as part of an investigation into illegal video poker operations called "Operation Double Black Diamond."
The inquiry has led to several convictions, including that of former state Transportation Secretary Garland Garrett Jr. Frank Perry, the FBI agent in charge of the Raleigh office, would say only that the probe is continuing.
Millions hidden
In September, state and federal agents announced that they had shut down the state's second-largest video poker operation, run by Johnston County businessman David Ricky Godwin and his son, Ricky Jr. The two have admitted trying to hide more than $5 million in illegal proceeds. They have yet to be sentenced.
Video poker is legal in North Carolina, provided the machines pay out nothing more than $10 in merchandise. No more than three machines are allowed in any one location.
But Robertson and many sheriffs say the video poker machines are often reprogrammed to pay out far more in cash. They say illegal operators are hard to catch because it is hard to track the machines.
The state Senate has tried twice to ban video poker, but the House has yet to go along. Black opted to put up for a vote a bill that provided more oversight of the industry through new regulatory fees on the machines.
The House passed the bill this year, but the Senate didn't take it up. This month, Black said he would continue to support more regulation instead of a ban.
"I'm about protecting jobs ... and that issue is jobs," Black said.
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