Fundraising firm charged with gaming violations
By Jennifer Reeger
Published: Thursday, Jan. 31, 2013, 12:01 a.m.
When Michael Schmidt's son brought home tickets to sell for his midget football team last September, Schmidt thought something wasn't right.
“They used scores from professional football games to determine the winner,” said Schmidt, a state police sergeant in Indiana County.
But he thought the biggest problem with the tickets was that the company that produced them, Green Bee Fundraising, kept 40 percent of the proceeds, leaving the Homer City Area Athletic Booster Club with the rest.
“If you run a small game of chance ... all the money has to stay with the nonprofit organization, except for the prizes you pay out and the costs you incur,” Schmidt said.
But now the owner of the Sharon-based fundraising company and one of his employees will face trial in Indiana County for allegedly violating the state's gambling laws.
Their attorney said what Green Bee does is no different than a Publisher's Clearinghouse sweepstakes or the Monopoly game at McDonald's restaurants.
“(They've) never had an issue whatsoever,” attorney Timothy Kidd said about Green Bee. “They do fundraisers for cerebral palsy, the Knights of Columbus, autistic children, Catholic high school fundraising. They do fundraising for all kinds of groups.”
When Schmidt first saw the tickets, he called officials from the booster club, which has a small games of chance license, to let them know he considered the program illegal. Club members immediately stopped selling the tickets and issued refunds, he said.
No members of the booster club were charged. A booster club official did not return a call for comment.
The tickets, which cost $10 each, advertised weekly prizes of $350 awarded based on the scores of three NFL teams added together, Schmidt said.
Schmidt continued investigating the matter, and in December charged Green Bee owner James Paul Thomas, 70, and an employee, Ronald Leo Bosworth, 40.
Schmidt said as a for-profit company, Green Bee is ineligible for a small games of chance license. And even though the boosters have such a license, a game contingent on football scores is not an approved game.
Kidd said Green Bee has been conducting such fundraising for more than 30 years in 37 states with no problems.
He said there is no purchase necessary to enter the sweepstakes. Rather, the sweepstakes is connected to a discount card, which people actually are purchasing for their $10.
Schmidt said his investigation revealed that the discount cards allow people access to Green Bee's web site, where they can receive discounts to other online retailers.
But he said those discounts are no different than what anyone can receive without the discount card.
In addition, Schmidt said he tried to enter the sweepstakes for free and was denied a free ticket.
“My contention is that they're not selling a discount card, and in fact, if this gambling on football games isn't contingent on it, they aren't going to sell any discount cards for $10 apiece,” Schmidt said.
The company's web site states that while a law enforcement official might take the position that the sweepstakes is gambling, the company maintains the game does not depend on the outcome of any individual game.
At a preliminary hearing earlier this week, Homer City District Judge Susanne Steffee ordered Thomas and Bosworth held for trial.
Kidd said he has a meeting scheduled next month with his clients to determine how they want to proceed. He contends that Schmidt is wrong.
“I think Sgt. Schmidt didn't want to sell tickets for his son's fundraiser,” Kidd said.
Schmidt said he didn't want to sell tickets he considered illegal.
As for Green Bee never facing a legal issue before, he said the reason might be simple.
“They probably never had a trooper's son come home with the tickets,” Schmidt said.
Jennifer Reeger is a staff writer for Trib Total Media. She can be reached at 724-836-6155 or firstname.lastname@example.org.
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