DENVER — A Denver man was convicted in federal court for running an illegal gambling business, the United States Attorney’s Office for the District of Colorado announced on Tuesday.
Jonathan Arvay, 38, was found guilty of one count of conducting an illegal gambling business and one count of conspiracy to conduct an illegal gambling business.
Arvay operated the Player One Arcade in Denver, which is part of a network of gambling establishments between Greeley and Pueblo, according to the U.S. Attorney’s Office for the District of Colorado.
The business offered several forms of gambling games that resembled arcade games and virtual slots.
Players won credits, which were exchanged for cryptocurrency that could be converted back to cash at an ATM-like machine next door.
Denver7 Investigates reported extensively on these illegal gambling arcades, or gray casinos, in 2022, going undercover at several establishments across the metro area to showcase how these businesses were circumventing state law.
A new state law signed in 2022 allowed the state’s Division of Gaming to help local communities shut down illegal gaming businesses by investigating those operated outside the municipalities where gaming is legal in Colorado.
Later that year, Lakewood announced it successfully shuttered three different gaming arcades in the city.
Arvay was prosecuted under federal law. The FBI Denver Field Division, IRS Criminal Investigation, and Pueblo Police Department conducted the investigation.
The release stated that the defendant was part of a “large, complex illegal gambling operation, both online and in person in Pueblo, Colorado Springs, Lakewood, Denver, Aurora and Greeley,” and that the businesses negatively impacted the surrounding community.
“These gambling dens masqueraded as arcades with a veneer of legitimacy,” Acting United States Attorney for the District of Colorado Matt Kirsch said in a statement. “I am grateful to law enforcement for digging beneath the veneer and finding that these establishments were causing real harm in our communities.”
Arvay will be sentenced in December and will face a maximum of five years in prison, $250,000 in fines, and three years of supervised release for each of the two charges.
