CLEVELAND COUNTY, NORTH CAROLINA – A two-count federal indictment charging three individuals with one count of conspiracy to conduct an illegal gambling business involving video poker machines was filed in U.S. District Court in Asheville on January 16, 2007 and officially unsealed on February 8. The indictment alleges that the illegal gambling conspiracy began on or before April 7, 2003, and continued to the present, and was carried out in Cleveland County in Western North Carolina. In addition to the conspiracy count, the indictment contains one additional count charging one of the defendants with the substantive offense of operating the illegal gambling business.

The indictment is announced by Gretchen C.F. Shappert, United States Attorney for the Western District of North Carolina, Nathan Gray, Special Agent in Charge of the FBI for North Carolina, Cleveland County Sheriff Raymond Hamrick, and Director Robin Pendergraft of the N.C. State Bureau of Investigation. The defendants are MERRILL RUPPE, 57, RICHARD CAMPBELL, 38, and SANDRA WALLACE, 57, all of Cleveland County. The defendants were arrested on February 8 and made initial appearances before a federal magistrate judge in Asheville that same day.

“Today we are announcing allegations regarding a continuing illegal video poker machine gambling operation. According to the allegations contained in the bill of indictment, these defendants are responsible for conspiring together to place and operate video poker machines in Cleveland County and elsewhere, and to violate the law by making illegal cash payouts to persons who won while playing on these machines. Under North Carolina law, any cash payout is illegal, and no one may receive more than a $10 merchandise credit or prize. Under federal law, any illegal gambling business which violates the laws of the state, involves five or more participants, and either grosses more than $ 2,000 in a single day or remains in substantially continuous operation for more than 30 days is a federal felony. The indictment alleges that the defendants conspired to conduct exactly such an operation, and alleges that RUPPE committed the substantive crime of actually operating such a business.” said U.S. Attorney Shappert, chief law enforcement officer over all Western N.C. counties.

The indictment is the result of an investigation that began more than two years ago, and the investigation into illegal video poker gambling operations in Western North Carolina is continuing. If convicted, each of the defendants faces a maximum statutory penalty of up to five years and a $250,000 fine on the conspiracy count (Count One) alone, and RUPPE faces an additional maximum sentence of up to five years and a $250,000 fine for the substantive illegal gambling business count (Count Two). If convicted, the defendants’ individual sentences will be determined by the Court after review of factors unique to this case, including each defendant’s prior criminal record, if any, each defendant’s role in the offense, and the characteristics of the violation. As to all defendants, no sentence will exceed the statutory maximum, and in most cases it will be less than the maximum.

The charges contained in the indictment are only allegations. In the American justice system, a person is presumed innocent unless and until he or she is proven guilty in a court of law.

The prosecution is being handled for the government by Assistant United States Attorney Richard Edwards.