Casino bid stays despite violations
A company consultant says anti-gambling forces pressured the state to act.
By TIM YOVICH
VINDICATOR TRUMBULL STAFF
LORDSTOWN -- State securities violations by a company trying to build a resort casino in Lordstown will not affect the effort, a consultant says.
The Eastern Shawnee Tribe of Oklahoma wants to build a $300 million Las Vegas-style casino resort on land in Lordstown in Trumbull County and Jackson Township in Mahoning County.
Casino gambling is illegal in Ohio. State law must be changed to allow it, and Gov. Bob Taft's administration opposes it.
A company connected to the tribe's attempt to build the casino, National Capital 1 Inc. and its president, Thomas Schnipple, admitted earlier this month to violating Ohio's securities laws.
Terry Casey, a consultant for both National Capital and the Eastern Shawnee Tribe, said Friday that National Capital is continuing its efforts in Lordstown.
He said the securities violations were technical, but the company did agree not to appeal the findings.
National Capital 1 and Schnippel agreed to a cease-and-desist order sought by the Ohio Department of Commerce concerning the sale of notes to raise money.
Unregistered securities
According to findings released by the commerce department, the company and Schnippel sold unregistered securities, made false representations in the sale of securities and engaged in securities fraud.
The company was created to promote and build a casino in Ohio that would be operated by the tribe.
Casey charged that anti-gambling interests in the Taft administration pressed the commerce department to pursue the case against National Capital 1.
A commerce department spokesman responded Friday that the case was brought against National Capital 1 "only on the merits of securities laws."
Taft will end his second term at the end of the year. "There are only a few months left in that administration," Casey noted.
Casey said that no investors have lost any money in the process.
Tribe's lawsuit
On June 26, the tribe filed a federal lawsuit in U.S. District Court in Toledo seeking claim to lands in Ohio.
If the court agrees, Casey said, the state will owe the tribe money that it would have received from the land had it been controlled by the tribe.
And, he suggested, the tribe would then be in a position to negotiate with the state to exchange the money it owed the tribe in exchange for allowing gambling.
Another company
Also earlier this month, another company, A Piece of the Action, agreed to a commerce department cease-and-desist order for the sale of investment contracts to build casinos in Ohio.
APOTA, according to state records and officials, was formed in 2004 to raise money for National Capital 1.
Casey said the cases against National Capital 1 and APOTA are separate issues and APOTA has no contract to act on behalf of the tribe.
"I think they [APOTA] were getting financing for themselves," Casey added.
yovich@vindy.com