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SPOTLIGHT
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Sweepstakes gaming company pulls up stakes in NC

Published on -3/27/2013, 4:39 PM

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RALEIGH, N.C. (AP) -- A company providing software for video sweepstakes cafes said it's leaving North Carolina because it's getting too hard to do business in the state.

International Internet Technologies LLC, sent the March 19 letter outlining its plans to several North Carolina law enforcement agencies.

The company said it would cease operations immediately, but it would take about a week for local operators to "completely wind business down," according to a letter reviewed Wednesday by The Associated Press.

But that doesn't necessarily mean the businesses will close. The company said that various local owners could continue to operate in their "current locations utilizing software from other providers."

Workers at the New Hope Business Center in Raleigh had already begun scraping the red-and-white IIT decals off the windows Wednesday. A woman who came out to shoo away a photographer said IIT had indeed pulled out, but that another company had already stepped in. She declined to give her name or to divulge the new operators.

The cafe's "open" sign was flashing Wednesday, and the oval ATM sign was lit.

Telephone messages left for the Winston-Salem, N.C., law firm representing IIT were not immediately returned Wednesday.

IIT is owned by Chase and Kristin Burns, an Oklahoma couple who are among 57 people indicted in Florida related to a chain of sweepstakes cafes affiliated with Allied Veterans of the World. Prosecutors said only about 2 percent of the $300 million raised in the cafes actually went to help veterans.

Records show Burns and his wife donated at least $230,000 to North Carolina political campaigns in the past two years, including $55,000 to groups affiliated with the North Carolina Republican Party and cash to more than 60 state lawmakers from both parties. The haul made the Oklahoma couple the largest single donors to North Carolina legislative candidates in 2012.

Gov. Pat McCrory's campaign got $8,000 from the couple shortly before the November election. The Charlotte law firm where McCrory worked just before taking office in January, Moore & Van Allen, lobbied on behalf of IIT in North Carolina. McCrory, who is not a lawyer and has never registered as a lobbyist, said he had no contact with Burns.

Four lobbyists at the firm have resigned from representing IIT, including a man who previously worked as McCrory's campaign spokesman.

Earlier this month, McCrory's campaign gave an $8,000 check to a Durham charity serving the homeless to offset the donations received from Burns and his wife.

The company in its letter said it was "directing its full attention and resources" to its legal problems in Florida.

"While IIT and its principals maintain they're innocent of any wrongdoing in Florida, conditions of release and other court orders make it virtually impossible for them to provide day-to-day support for their licensees in this state," the company said.

Eddie Caldwell, spokesman for the North Carolina Sheriffs' Association, said IIT is one of the major players in the North Carolina sweepstakes industry.

"This is huge," Caldwell said about IIT's decision to leave the state.

The company has been fighting to stay in business in the state. After the state Supreme Court in December upheld a state law banning video sweepstakes games, IIT asked for a temporary injunction to prevent Davidson County from closing a parlor. But a judge dismissed the lawsuit in January.

Cumberland County authorities on Tuesday raided several video gambling sweepstakes cafes, and arrested about a half-dozen people.

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AP National Writer Allen G. Breed contributed to the story

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