Missouri: casino cities urge state authorities to crack down on "pre-reveal" gaming machines

As Missouri starts debating the legalization of sports betting this year, officials for Missouri’s 13 cities that have casinos called on Wednesday for a crackdown on illegal gambling machines, which they describe as having flooded the Show Me State in recent years. 

“Only Missouri’s voters can decide where gambling can take place legally in our state, and currently that is limited to our 13 state-licensed riverboat casinos,” said Maryland Heights Mayor Mike Moeller, president of the coalition, according to St. Louis Post Dispatch.

Members of the Missouri Home Dock City Association are urging Attorney General Eric Schmitt, county prosecutors and law enforcement agencies to take a stronger approach to enforce laws prohibiting unregulated slot machines, present in convenience stores, bars and truck stops all across the state. 

The debate on the legality of “pre-reveal” games has been a long-standing one, and bills seeking to ban these machines have been introduced in the last few years, and earlier this year as well. The machines, which have become popular throughout the state, have also led to several pending prosecutions, while other parties maintain the games are not illegal at all.

Wildwood-based company Torch Electronics has placed as many as 14,000 machines in establishments such as gas stations. It claims the machines are legal because players can find out if they will win the next game before they put any money into the machine, thus not making them “games of chance.”

The state Constitution prevents gambling outside of regulations set by the state’s gaming commission and as it stands, these machines currently operate in an unregulated and untaxed manner. They operate in a gray area given their alleged “no chance gaming” features.

The machines pose a problem for the state, given they are not subjected to the usual 21% tax rate slot machines within casinos are, and lack of regulation implies no accounting for how much money is placed in them. “Pre-reveal” games look similar to electronic slot machines and offer a variety of games, with bets that can be placed for 50 cents or more.

Prosecution thus far has been spotty, with the games operating in what has been described as a loophole. Torch has launched an intense lobbying campaign and last year it sued the state in Cole County Circuit Court in an effort to stop officials from seizing its devices.

“For more than a decade, a handful of companies have ignored this voter-approved structure by placing thousands of illegal gaming machines in gas stations, truck stops and other venues of convenience,” Moeller further said, according to the cited source.

The Maryland Heights Mayor claims the gambling machines, which he describes as “illegal,” have evaded state regulatory and transparency rules and “fail to deliver on the job creation and economic development” required by the state Constitution and state law.

The Senate is currently considering Senate Bill 632, which would state that an illegal gambling device is one not regulated by state gambling authorities that involves cash payouts, which would include pre-reveal games. It would also ban companies convicted of illegal gambling from participating in any future expansion of legal video gambling in the state.

Lawmakers have long called into question claims from companies such as Torch that the games aren’t of chance, stating they are latching to a loose definition. SB 632 would also find establishments hosting these games as in possession of illegal gambling devices, which could lead to penalties.

“It’s high time our state’s law enforcement community remove these machines from our local communities and hold the manufacturers accountable instead of allowing them to put millions of dollars into key legislators’ pockets to change the laws without a vote of the people,” Moeller concluded. “To date, Missouri state legislators have rejected all such demands.”