Six state lawmakers called Tuesday for the state attorney general to investigate whether state gaming regulators broke the law when they, according to sources, ordered their investigators to change a background report on Mount Airy Casino Resort owner Louis DeNaples.
The lawmakers are asking whether the Pennsylvania Gaming Control Board is allowed to directly influence and oversee the work of its Bureau of Investigations and Enforcement. The state's slot machine law, the lawmakers said, makes the bureau independent of the board.
Gaming board spokesman Doug Harbach said the agency is ''confident that it has complied with all legal requirements applicable to the licensing process of all slot machine applicants.''
Kevin Harley, a spokesman for Attorney General Tom Corbett, said he could not comment on whether Corbett planned to investigate.
The lawmakers -- all Republicans questioning an agency overseen by Democratic Gov. Ed Rendell -- sent copies of their request for a probe to the state police, the U.S. Department of Justice and the FBI.
At a news conference, the lawmakers said they were moved to act after a story Sunday in The Morning Call. The newspaper, citing sources, reported that BIE revised its background report on DeNaples at least six times after gaming board Executive Director Anne Neeb and general counsel Frank
Donaghue reviewed each draft and objected to BIE's findings as inconclusive, unsubstantiated or hearsay.
Neeb and Donaghue ordered BIE to strip investigators' analysis of their findings from the report, sources told the newspaper. That overruled Michael Schwoyer, then-deputy chief counsel for BIE, who argued that BIE's conclusions were vital and necessary for the board's consideration, said the sources, who are familiar with the process but who spoke on the condition of anonymity.
The report, sources said, included brief references to what BIE had uncovered about DeNaples, including alleged ties to reputed mobster William D'Elia, questionable campaign contributions to Rendell and others by some of DeNaples' businesses, and the purchase and resale of trucks damaged by Hurricane Katrina by a company DeNaples co-owns. BIE's raw findings were attached as exhibits, the sources said.
In addition, the story said attorneys representing DeNaples were alerted to BIE's findings as the investigation unfolded and were allowed to challenge BIE's analysis and conclusions.
DeNaples, of Dunmore, Lackawanna County, faces four counts of perjury for allegedly lying to gaming regulators about his ties to reputed organized crime figures. His slots license was suspended in February and a trustee appointed to oversee Mount Airy's operations. He has said he is not guilty.
The lawmakers want answers on the gaming board's licensing practices because ''if we don't have a process that we can believe in, it undermines the entire institution,'' said Rep. Craig Dally, R-Northampton, who was joined by fellow Republican Reps. Paul Clymer, Bucks; Doug Reichley, Lehigh; Curt Schroeder, Chester; Mike Vereb, Montgomery; and Mike Turzi, Allegheny.
In an interview for Sunday's story, former gaming board Chairman Tad Decker said the board members ''only wanted to know what could be proven.''
On Tuesday, the lawmakers indicated that a 1992 state Supreme Court decision, Lyness v. Commonwealth, reinforced the notion that ''even the appearance of bias and partiality must be viewed with deep skepticism in a system which guarantees due process to each citizen.''
But Harbach, the gaming board spokesman, in a written response to The Morning Call, said lawmakers had misapplied the high court ruling.
''The reliance on the Supreme Court's Lyness decision as a basis to call the process into question is clearly misplaced in the licensing context and forms no basis for the allegations made against this agency and its staff,'' Harbach said.
''The board cannot, as a matter of law, base its decisions on information which is comprised of rumor, innuendo or speculation because this is the type of information which is not substantiated in that form,'' Harbach said. ''This is a matter of well-established case law based on principles of due process, rules of evidence and administrative agency law.''
The lawmakers said Tuesday the gaming board had ''stonewalled'' them on getting information, and they called for reforms.
Harbach said the board already has ''pledged its cooperation as a resource in the examination of legislative proposals which could strengthen the board's regulatory authority.''
The Morning Call story, the lawmakers said, underscored the need to create a select legislative committee with the authority to subpoena documents and witnesses.
Lawyers for Louis DeNaples, owner of Mount Airy Casino Resort, ask the state Supreme Court to probe possible news leaks on private grand jury proceedings.
The Pennsylvania Supreme Court orders the Dauphin County judge overseeing the grand jury to determine whether a special prosecutor is warranted.
The district attorney prosecuting the case agrees to a special prosecutor, saying his office has not leaked information.
Dauphin County Judge Todd Hoover will decide whether to appoint a special prosecutor.
Hoover will hold a hearing to determine which, if any, news stories warrant scrutiny over grand jury secrecy rules.
Lawmakers' reasons for seeking opinion: Section 1517(a) of state gaming law establishes Bureau of Investigations and Enforcement ''which shall be independent of the board in matters relating to the enforcement'' of gaming. Section 1202 requires the gaming board to ''insure the separation of functions'' between the board and BIE.
Gaming board's response to lawmakers' concerns: ''The [board] is confident that it has complied with all legal requirements applicable to the licensing process of all slot machine applicants,'' gaming board spokesman Doug Harbach said.Copyright © 2015, The Baltimore Sun