Lucky Bucks RICO files $200 million fraud lawsuit
Former employees of Georgia-based slot machine operator Lucky Bucks fraudulently extracted "illegal dividends" before the company's recent bankruptcy. That's according to a RICO lawsuit filed by the company's new management.
The lawsuit, filed last Thursday, accuses 10 individuals and a dozen affiliated companies of looting about $200 million from the company before it went bankrupt last year.
Lucky Bucks operates approximately 2,300 slot machines at 345 locations in Georgia. These are not Las Vegas style slot machines, but "COAMS" (Coin Operated Amusement Machines) as they are known locally. These are "skill-based" gaming terminals that offer coupons or lottery tickets as prizes.
Lucky Bucks filed for Chapter 11 bankruptcy reorganization in June 2023. The company reported more than $500 million in debt, citing increased competition, rising interest rates, an economic environment that reduced consumer use of slot machines, and tighter regulatory enforcement against COAM. Industry in Georgia.
"Illegal Dividend"
Lucky Bucks was bailed out by major lenders, who injected new capital and renamed the company Arc Gaming and Technologies. Last July, the Delaware Bankruptcy Court approved its Chapter 11 plan.
Lucky Bucks founder and former owner Anil Damani and his team were involved in a scheme to borrow hundreds of millions of dollars from lenders and split the proceeds among them, the new owner claims.
Government regulators banned Damani from the company's operations in June 2020, according to the lawsuit.
In total, nine former senior employees, one contractor and more than a dozen affiliated companies were named. They are accused of defrauding the company by diverting $200 million in "illegal dividends" before filing for bankruptcy.
Those methods included transferring contracts from Lucky Bucks before selling them back at inflated prices, and simply chiseling serial numbers out of machines before selling them, the lawsuit alleges.
"Unsubstantiated Claims"
The plaintiffs also allege that the defendants attempted to hide their activities by communicating on encrypted messaging applications and deleting files and business records from company computers.
Investigators from the new management team analyzed IT systems and conducted employee investigations to resolve the alleged fraud, the lawsuit says.
Damani's attorney, Scott R. Grubman, told Bloomberg the charges were "baseless" and described his client as "a successful businessman and a pillar of the community." .
Grumman added that his clients look forward to defending the claims in court.
Read also:
- Football 101: What is relegation in football?
- Las Vegas Strip's high-end casinos powered by baccarat
- Tilman Fertitta bullish DraftKings, Wynn heading into 2024
- Kick Gambling Streamer xQc has been kicked out of Canadian casinos
Source: www.casino.org
