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Monday, April 17, 2006

Hidden costs of gambling

From addiction to big-money embezzlement, authorities express concerns over increase in casino-related problems

By PHIL FAIRBANKS
Buffalo News Staff Reporter
4/17/2006

Original Article

Carl Bucki sees the impact of casino gambling in the record number of cases that cross his bench as federal Bankruptcy Court judge.

Frank Clark sees it in the big-money embezzlement cases his county prosecutors take to trial.

And Renee Wert sees it in her addiction counseling caseload that has more than doubled since casinos first arrived on the local scene.

The Seneca Niagara Casino's economic impact is not just jobs, taxes and development. It also includes crime, bankruptcy and job loss.

These are the hidden costs of gambling.

"He doesn't see half of it," Wert said of Clark. "People are stealing from their families, and it's going unreported. They're taking money from their kids' college funds. I've seen cases of parents breaking into their kids' piggy banks so they can gamble."

Wert, as head of gambling treatment services at Jewish Family Service, is on the front lines. Her caseload jumped 147 percent in five years, and she estimates seven out of every 10 people she treats have filed for bankruptcy.

That's just one of the costs to the community. No one disputes the notion that Seneca Niagara and other gambling venues create problem gamblers. The question is, how many and what do they cost the local community?

Even the nation's top researchers, from Harvard to the University of Illinois, disagree over the extent to which casino gambling adds to a community's ills and at what cost.

"There's no pee test for gambling," said Mark Farrell, the town judge in charge of Amherst's Gambling Court. "It's like trying to get your hands around a cloud."

But talk to the judges, prosecutors and counselors who see the effects firsthand, and you hear horror stories of people who got addicted and fell into debt.

Or people so desperate for cash, they stole from their family or employer.

They also will tell you that bankruptcy, more than anything else, may be the single most common consequence of being a "problem or pathological" gambler.

Wert's program counseled 245 people last year, up from 99 in 2000, and she estimates 70 percent for bankruptcy. Some twice.

That's hardly a surprise to Bucki, one of two U.S. Bankruptcy Court judges in Western New York. He's convinced casinos are a big part of the problem.

"There's no question in my mind," Bucki said. "After handling thousands of bankruptcy cases, I'm convinced casino gambling is a significant factor in the tremendous increase we've seen in bankruptcy cases."

There were more than 14,000 bankruptcy filings in Western New York last year, nearly four times the number in 1993.

"I know, for a fact," he said, "that this problem goes largely unreported."

Even in his own court.

Bankruptcy filers are required to fill out a questionnaire, a "Statement of Financial Affairs," that asks if gambling is one of the reasons they're in debt.

Most people, because of shame and embarrassment, answer "no" even when gambling is a factor, Bucki said.

More often than not, he added, the gambler blames his debt on credit card abuse. What he won't tell you is that his paycheck went into the slots. And that's when he turned to credit cards.

Bucki isn't the only law enforcement official who sees a link between increased crime and casinos.



Bigger caseloads

County prosectors used to prosecute big-money embezzlement cases, those involving more than $100,000, about three or four times a year. His staff now sees four times that number, Clark said.

"Over the past five or six years, I've seen a dramatic increase in embezzlement-type crime, and gambling has played a role," the district attorney said.

Assistant District Attorney John Doscher is the prosecutor in those cases, and he estimates the number of casino-related cases doubled in five years.

Not so long ago, the big embezzlement cases centered on people who lived the high life, Doscher said. Now, it's losses at the casino.

"We're getting more cases and bigger cases," he said. "It used to be rare to see anything over $50,000. It's no longer something that makes your eyes pop out. Now, it just doesn't catch your attention."

Bigger caseloads are also the trend in Amherst Town Court, home to the only Gambling Court in the nation.

That's where Farrell, every two weeks or so, hears the stories of gamblers who stepped over the line. Most have misdemeanor or felony convictions involving large sums of money and have been diagnosed as problem or pathological gamblers.



Denial and secrecy

During one two-hour court session in March, more than a dozen people appeared before Farrell.

Some were like Walter, a small-business owner. He estimated he lost more than $40,000 gambling at the casinos.

"Folks have no clue what overcame you," Farrell told the man, "and how pervasive a gambling addiction can be."

"I always gambled," answered Walter, now in his 40s. "As a young man, that was the cool thing to do."

One by one, the recovering addicts marched before Farrell and told story after story of self-destructive behavior that led to crime.

"I've gambled every day of my life since I was 19," said a man identified only as Anthony, a young husband and father arrested for writing a bad check. "It quickly became a downward spiral and very destructive."

For many of the people, Farrell is the only thing standing between them and jail time. And yet, the judge still finds himself confronting denial and secrecy.

"People are more willing to admit they're drug users than gamblers," Farrell said.

One of the problems in tracking the link between gambling and crime is a reluctance to go to the police, especially when the victims and thieves are family members.

"What you get is a lot of denial," said Anne Constantino, president of Horizons Health Services, one of two local treatment agencies.

The typical case isn't the gambler who gets arrested, it's the gambler who gets away with his crime, says Wert, from Jewish Family Service.

She still talks about the young man who stole his mother's Social Security number, used it to acquire credit cards and left her with $30,000 in gambling losses.

"Mom couldn't bring herself to prosecute," Wert said.



Heated debate

The hidden costs of casino gambling are being debated across the country, wherever there's a casino, and nowhere is the discussion more passionate than at the nation's top colleges and universities.

In one corner, researchers suggest gambling creates a host of economic problems, from suicide, divorce and domestic violence, to bankruptcy, crime and low employee productivity.

One expert, Earl Grinols, an economics professor at Baylor University, told Congress in 2003 that for every $1 in benefits, gambling costs society $3.

On the other side of the debate are experts who claim the "invisible" nature of problem gambling makes it difficult to quantify, both in terms of people and money.

In 1999, the National Gambling Impact Study commissioned by Congress referred to both schools of thought in calling for a moratorium on casino development.

The study estimated the number of problem and pathological gamblers in the United States had reached 3 million, with 15 million more people at risk. It also put the cost to society at about $5 billion a year.

One thing is certain, Wert said. The problem is getting worse, not better, in large part because of casinos here and elsewhere.

"When I started here in 1994, we had a lot of sports, horse racing and lottery gamblers," she said. "Now, it's almost exclusively casino and lottery gamblers."


e-mail: pfairbanks@buffnews.com

1 Comments:

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