Schuette Announces Closure of Eight "Internet Sweepstakes Cafes" After Investigation Revealed Illegal Gambling Operations

Contact: John Sellek or Joy Yearout 517-373-8060

May 3,  2012 

LANSING - Attorney General Bill Schuette today announced the Attorney General's Alcohol & Gambling Enforcement Division has reached an agreement with Innovative Entertainment of Michigan that will halt operations at eight Internet sweepstakes cafes indefinitely.  The agreement comes as the result of an ongoing investigation by the Michigan State Police, the Michigan Gaming Control Board and the Attorney General's office. 

"Internet sweepstakes cafes that permit illegal gaming are nothing more than unregulated pop-up casinos and consumers should steer clear," said Schuette.  "We will continue to work with the Michigan State Police and the Michigan Gaming Control Board to shut down these and any other illegal gambling operations."

Innovative Entertainment of Michigan licenses and supplies the casino-style gaming software for eight Internet sweepstakes cafés in Michigan.  Pursuant to an agreement with the Attorney General's Alcohol & Gambling Enforcement Division, Innovative has remotely shut down the gaming software at all eight locations.  These locations are:

·         Starz Café (2056 28 Street, Suite 16, Grand Rapids, MI);

·         Lucky's Internet Café (3514 Plainfield, Grand Rapids, MI);

·         Knights Café (923 N. Wisner Street, Jackson, MI);

·         The Luck Spot (7632 Westnedge Avenue, Portage, MI);

·         Cyber Café (2495 Cedar, Suite A-05, Holt, MI);

·         Cyber Café 2 (3407 Genesee Avenue, Saginaw, MI).

·         Lansing Business Center (3620 S. Waverly, Lansing, MI); and

·         Flint Business Center (4835 Fenton Rd., Flint, MI).

This voluntary closure follows a series of cease and desist letters issued by the Attorney General's Alcohol & Gambling Enforcement Division on April 9, 2012.  The letters warned of possible legal action against three cafes (Flint Business Center, Lansing Business Center, and the Holt-based Cyber Café) if they refused to halt ongoing gambling operations that violated state gaming laws.  Should any of the eight locations reopen, Schuette will take immediate action to shut them down through the criminal or civil court system.  Investigations are still pending against the owners and operators of these businesses that may result in additional criminal or civil charges.

In the meantime, the Michigan State Police, Gaming Control Board, and Attorney General's office will continue to investigate and close other unlawful internet sweepstakes throughout the state.

Internet sweepstakes cafés are businesses that sell Internet access and the chance to play computer-based casino-style games where customers can win cash prizes.  The operations are housed in buildings that contain banks of computers with Internet access.  Some serve light fare, like pop and chips, to patrons.  Each purchase entitles the customer to a certain number of sweepstakes entries.  The customer is then given the opportunity to "reveal" whether the sweepstakes entries are winners by using a computer monitor that activates a spinning wheel similar to that of a casino-style video slot machine.  Schuette asserts that this type of gaming violates the Michigan Gaming Control and Revenue Act.

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

Michigan citizens are encouraged to report any suspicious or illegal gambling to the Michigan Gaming Control Board by calling their 24-hour anonymous tip line, 888-314-2682.

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