State drops criminal case against former city bar president over $300 million web gambling operation

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Prosecutors have dropped criminal charges against a prominent Jacksonville, Florida, lawyer rather than carry on with a new trial ordered by an appeals court, the Orlando Sentinel reports.

Kelly Mathis, 53, had been convicted in 2013 of racketeering and more than 100 other charges stemming from his part in a franchise business that he called “internet cafés,” and that Seminole County prosecutors called a poorly disguised sting of casinos with slot machines and lotteries bringing in $300 million a year.

Mathis, a former president of the Jacksonville Bar Association, argued that he was just the lawyer for a nonprofit, Allied Veterans of the World, which had a chain of internet gaming centers were legal.

Last October, the Fifth District Court of Appeal in Daytona Beach reversed the conviction and ordered a new trial. The appeals court found that the trial judge had been wrong to exclude testimony from public officials and lawyers who would say that the gaming centers were legal under Florida’s sweepstakes law. Sweepstakes are not considered gambling if they bring in customers to a business that sells a legitimate product, Jacksonville.com reported.

The storefronts had personal computers that software converted to virtual slot machines, the prosecution said at trial. Customers brought prepaid cards for internet time for games such as “Captain Cash” and “Lucky Shamrocks.” Winnings went onto the cards which could be redeemed for cash. Prosecutors said that 2 percent of the proceeds went to charity.

More than 50 of the centers were raided and shut down in March 2013. More than 50 people were arrested, including Mathis, Allied executives and franchise holders.

Charges against many defendants later were dropped, while some defendants entered pretrial diversion programs and some others were placed on probation.

Mathis was the only one to go to trial, and in February 2014, he was sentenced to six years in prison, though the judge let him remain free on bail while appealing the conviction.

Prosecutor Nick Cox recently notified Mathis’ lawyer, Mitch Stone, that he had dropped the charges, preferring to avoid the expense and trouble of another trial.

Stone says Mathis has been unable to practice law since his 2013 conviction and hopes the Florida Bar will lift his suspension.

“It cost him every bit of money he ever earned,” Stone said. “It cost him his law practice, his marriage. He’s rebuilding his life.”




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