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Four arrested for illegal arcade gambling scheme

Riley Board
The Spot, in Kenai, has been the subject of an illegal gambling investigation.

Four Kenai-area residents were arrested Thursday in what Alaska State Troopers are describing as an illegal gambling scheme operating out of two arcades, one in Kenai and one in Soldotna.

According to an affidavit, the Statewide Drug Enforcement Unit got a tip in December of 2022 about illegal gambling happening at an arcade in Kenai. The tip said that while The Spot was set up to look like an arcade, it actually functioned as a gambling hall, by using cash instead of tokens and operating games of chance.

Trooper spokesperson Austin McDaniel said state statutes prohibit gambling on games of chance.

“Which means a contest, game, gaming scheme or gaming device, in which the outcome depends a material degree upon an element of change, notwithstanding that skill of the contestants may also play a factor. So there’s no skill in the game, it’s all chance, on whether you win,” he explained.

Police say they began an undercover investigation this summer. An officer who entered The Spot was shown the gambling process and told by the owner that it was similar to playing slot machines. The officer left the business with more money than he brought.

Officers also investigated a second location in Soldotna, called Arctic Spot, that opened while the investigation was ongoing. The affidavit says similar illegal gambling activities were happening there.

“Since our investigation started, and looking back to December of last year through the search warrant service that occurred this week, we have observed this criminal level of gambling promotion occuring at both of these locations,” McDaniel said.

According to a dispatch, troopers seized about $75,000, money counters, gambling machines and ledgers when they executed the warrant, along with an AK-47 with the serial number stripped.

The affidavit says investigators identified more than five people involved in the enterprise. Four were arrested yesterday: business owner Richard Mauia was charged with promoting gambling in the first degree. Tom Papalagi, who worked as security at one of the locations, was charged with promoting gambling in the first degree, possession of gambling records and misconduct involving a weapon for the rifle. Two other Kenai residents, Weiqiang He and Chengshan Liu, were also charged with promoting gambling in the first degree.

McDaniel said the investigation isn’t over.

“We’re working with our partners at the Alaska Department of Law to continue to look through this investigation and determine if there’s additional charges that may be filed against these individuals that have already been arrested, or additional individuals that are involved in this scheme or in this enterprise,” he said.

None of the defendants have any prior criminal record. They were arraigned this morning at the Kenai Courthouse.

Riley Board is a Report For America participant and senior reporter at KDLL covering rural communities on the central Kenai Peninsula.