Florida lieutenant gov quits, 57 charged in gaming scandal

Orlando, Fla. — Florida's lieutenant governor resigned and nearly 60 other people were charged in a scandal involving a purported veterans charity that authorities said Wednesday was a $300 million front for illegal gambling.

Allied Veterans of the World runs more than 40 Internet parlors offering computer games of chance, which are normally legal in Florida if most of the proceeds go to charity. But authorities said the organization's executives gave precious little to veterans and lavished millions on themselves, spending it on boats, real estate and Maseratis, Ferraris and Porsches.

Florida Attorney General Pam Bondi called the alleged scam "callous" and "despicable" and said it "insults every American who ever wore a military uniform."

Lt. Gov. Jennifer Carroll was not among those charged but resigned a day after she was questioned by investigators.

Her public relations firm did work for St. Augustine-based Allied Veterans. Carroll, a Navy veteran who served in the Gulf War, also appeared in a TV ad in 2011 promoting the organization's work on behalf of veterans and their families.

Authorities refused to discuss any ties between the 53-year-old Republican and the investigation. Her aides had no comment.

Carroll's resignation letter did not explain why she was stepping down, but Republican Gov. Rick Scott said she resigned so that her ties to the organization would not be a distraction for the administration.

The investigation involved 57 arrest warrants and 54 search warrants issued in Florida, South Carolina, Georgia, Alabama, Nevada and Pennsylvania. As of midafternoon, 49 people had been arrested.

Authorities said they seized about 300 bank accounts containing $64.7 million, as well as sports cars and other property.

Bondi said that when charges are formally filed next week they will include racketeering, conspiracy, money laundering and possession of slot machines.

"It is shameful that Allied Veterans of the World allegedly attempted to use the guise of charitable organization to help veterans in order to lend credibility to this $300 million gambling scheme," she said.

A telephone number listed for Allied Veterans was disconnected. Emails to an address on the group's website were not returned.

One of those arrested, Jacksonville lawyer Kelly Mathis, was identified by authorities as the mastermind of the scheme. He allegedly made about $6 million from the operation.

From 2007 to early 2012, investigators said, they found evidence of nearly $6 million in what appear to be charitable donations by Allied Veterans. That was only about 2 percent of the more than $290 million made from gambling during that period, they said.