ABINGDON, VIRGINIA -- A Cedar Bluff, Va. man pled guilty yesterday morning in the United States District Court for the Western District of Virginia in Abingdon to charges involving the operation of an illegal gambling establishment.

Garfield White, 58, of Cedar Bluff Va., pled guilty to one count of operating an illegal gambling establishment and one count of failing to file a tax return. He faces a potential maximum punishment of six years imprisonment and up to $225,000 in fines. The defendant also agreed to pay a money judgment to the United States in the amount of $20,000.

The charges resulted from a cooperative investigation by the Russell County, Virginia Sheriff’s Office, Washington County, Virginia Sheriff’s Office, Virginia State Police, Russell County, Virginia Commonwealth’s Attorney’s Office, Internal Revenue Service Criminal Investigations, and the United States Marshals Service.

“For years, Mr. White ran a highly profitable illegal gambling business in Russell County,” United States Attorney Timothy J. Heaphy said today. “His high stakes poker games generated considerable income, none of which he reported to the IRS. When individuals like Mr. White engage in illegal activity and attempt to hide the proceeds of their crimes, this office hold them accountable.”

According to evidence presented at the guilty plea hearing by Assistant United States Attorney Zachary Lee, in early 2009 the Virginia State Police, the Russell County Sheriff's Department and Internal Revenue Service initiated an investigation into the operation of an illegal gambling establishment located in a house in the Belfast area of Russell County, Virginia.

From July 2009 until August 2010, surveillance was conducted the Belfast location that revealed a circuit of poker players who attended this poker game and other games, including at least 42 different individuals who were observed at the Russell County establishment. Players were observed driving vehicles registered in Virginia, Tennessee, West Virginia, Georgia, Kentucky, and Alabama.

Surveillance, interviews and undercover operations determined that White’s game occurred once a week, that White provided food and drinks to the players, and that games would last from 5 to 10 hours or more.

Furthermore, "pots" in excess of $10,000 were not unusual and players were known to lose in excess of $20,000 in one day of gambling. In August 2010, search warrants were executed at White’s gambling operation by the Russell County Sheriff’s Office, Virginia State Police, Internal Revenue Service, and the United States Marshals Service. There was an active game in progress at the Belfast location when the warrants were executed and White was present at the time of the execution of the warrant. Gambling paraphernalia and other evidence related to the operation of a gambling establishment was located and seized and approximately $20,000 in cash was seized from individuals participating in the poker game.

The investigation concluded that White hired individuals to serve as dealers for the games and utilized other individuals to assist with selling chips, monitoring play, and providing food and beverage service to players. A conservative estimate based upon the investigation indicated that an average of $100-$200 an hour was cut from the pot at each establishment for the benefit of the operator. As a result of the illegal operations, White received an estimated $50,000 or more annually in gross income. The investigation also determined that White filed income tax returns in years prior to 2009, he had not filed income tax returns for the calendar year 2009 reflecting his income from the poker operation or any other income. His income from 2009 was in excess of $10,000.

The investigation of this case was conducted by the Russell County, Virginia Sheriff’s Office, Washington County, Virginia Sheriff’s Office, Virginia State Police, Russell County Commonwealth’s Attorney’s Office, Internal Revenue Service Criminal Investigators, and the United States Marshals Service. Assistant United States Attorney Zachary T. Lee of the United States Attorney’s Office in Abingdon is prosecuting the case.

 

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