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North Dakota reaches settlement in charitable gambling case, companies fined for violations


In a significant development, three North Dakota companies have agreed to pay fines and settle allegations related to violations of the state’s charitable gaming laws. The settlement was announced by North Dakota Attorney General Drew Wrigley, who revealed that Western Distributing Company, Plains Gaming Distributing Inc., and Midwest Gaming Distributing Inc. will collectively pay fines amounting to $125,000. Additionally, they will cover at least $36,000 in attorney costs incurred by the attorney general’s office.

The violations made by the companies

The allegations against the companies stemmed from a complaint filed in April, which accused them of engaging in a scheme with a local veterans charity called Wall of Honor to secure locations for electronic pull-tab machines they distribute. The complaint outlined a network of relationships between the charity, the distribution firms, and a third company called Advanced Gaming Solutions, LLC.

North Dakota reaches settlement in charitable gambling case

The companies involved, Western, Plains, and Midwest, acknowledged that their representatives had “unlawfully used entities such as ‘Wall of Honor’ and Advanced Gaming Solutions, LLC to improperly acquire sites for charitable gaming organizations and/or to assist charitable gaming organizations, in violation of North Dakota gaming laws and regulations.” Furthermore, they admitted that previous statements denying any wrongdoing and violation of state law were inaccurate.

The issued settlement–is it enough to be a deterrent?

As part of the settlement, the companies have agreed to sever ties with David L. Wisdom, president and shareholder of Western Distributing Company and Plains Gaming Distributing, Inc., as well as any immediate family members. Initially, Attorney General Wrigley had sought to revoke the distributors’ licenses, but the settlement defers this action as long as they comply with the terms of the settlement and avoid further violations for the next three years.

The settlement comes at a time of increased scrutiny surrounding electronic pull-tab machines, which resemble slot machines. Since 2017, when North Dakota allowed charities to install these devices, over 4,400 terminals have been deployed across more than 800 sites statewide, generating nearly $1.75 billion in fiscal 2022.

Attorney General Wrigley emphasized the importance of upholding the integrity of charitable gaming in North Dakota and protecting the public trust. He stated, “The last year has brought a new day in gaming enforcement, and the public can be assured that law enforcement and the outstanding professionals in the Attorney General’s Gaming Division are working hard to protect the integrity of the limited charitable gaming that is permitted under North Dakota law.

In a separate development, Wrigley mentioned that he is reviewing an email sent to the distributors’ customers to ensure compliance with the settlement’s provisions. The email, sent before the settlement was announced, outlined the distributors’ interpretation of the terms and acknowledged their incorrect understanding of the rules regarding the Wall of Honor.

The Wall of Honor, which was not implicated in the complaint, expressed satisfaction with the settlement. In a statement, the group’s Volunteer Executive Director Tammy Ibach emphasized the importance of sustaining veteran organizations while honoring those who have served the country.

This settlement marks a significant step in addressing violations within the charitable gaming industry in North Dakota, and it serves as a reminder of the importance of adhering to gaming laws and regulations to maintain public trust and the integrity of the gaming sector.

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