LOUIS DENAPLES, the Scranton-area millionaire ready to open a casino near there, came up with an idea last December after questions were raised about his "suitability" for a gaming license.
DeNaples' attorney met with the state Gaming Control Board on Dec. 19, one day before the board was set to decide on the licenses, and proposed that an "independent audit committee" run the Mount Airy Resort & Casino.
When board member Mary DiGiacomo Colins asked why the audit committee was being suggested, attorney John Donnelly said it was because "so many questions arose" about DeNaples.
Those questions, including long-running rumors of DeNaples' ties to organized crime, are now the subject of a Dauphin County grand jury investigation.
DeNaples, through a spokesman, has denied mob ties.
The grand jury, which meets again today, last month heard from two convicted felons and a reputed upstate mob leader.
Donnelly, in December, repeatedly sought to downplay DeNaples' role in the proposed casino, which is nearly completed and slated to open Oct. 15. He called DeNaples a "financier" who would let others run it.
"He'll be watching it," the attorney told the board. "But he won't be running it."
Donnelly promised that the casino's management team would be "strengthened immediately" if DeNaples won a license.
Mount Airy received that license more than five weeks ago.
Kevin Feeley, a spokesman for DeNaples, said names for the audit committee have been submitted to the Gaming Control Board for background checks and approval. He declined to say who those people are, adding that was up to the board to disclose.
Board spokesman Doug Harbach also declined to identify the proposed audit committee, saying that was up to DeNaples.
What is known is that Donnelly promised the board that the audit-committee members would have "unfettered control" of the casino, with high-ranking executives reporting to them and the committee reporting directly to the Gaming Control Board.
He suggested the members, who will be paid by the casino, might be professionals with experience in gaming regulation, law enforcement and finance.
The Gaming Control Board on Aug. 8 gave DeNaples permission to start receiving slot machines at his Mount Pocono casino. Those machines started arriving and were being installed two weeks ago, even though the audit committee is not in place.
Harbach noted that DeNaples received his casino license on the condition that the audit committee is put in place. The casino can't open, he said, until that committee is approved by the board.
Focus on the DeNaples gaming license this month exposed a long-running turf battle between the Gaming Control Board, which conducted background investigations for casino applicants, and the Pennsylvania State Police, which wanted to do that work.
Two Republican state representatives, Douglas Reichley of Berks County and Mike Vereb of Montgomery County, are seeking support for legislation proposing to make the board's Bureau of Investigations and Enforcement an independent agency that would work with the state Attorney General's Office on future casino background checks. Reichley and Vereb noted the Dauphin County grand jury when discussing their proposed legislation.
Reichley said he and Vereb started speaking with the Gaming Control Board months before the grand jury investigation was revealed. They didn't like what they heard from the board.
"The gaming board was trying to say: Everything's OK here. No need to rock the boat," he said.
Vereb said the investigation's timing might help move the legislation. "If this grand jury helps us in this quest, so be it," he said.