The Number's Up for City's Casinos

Moscow authorities are preparing a message for the city's burgeoning gambling business: This isn't Las Vegas.


A Moscow government order, signed on June 28 to follow up on President Boris Yeltsin's June decree outlining tough measures to combat organized crime, charges three city departments with working out a way to cut the number of casinos to just five in the city center and three in each of the eight prefectures on the outskirts.


The order also calls for changes in casino licensing rules and requires all private firms in Moscow to re-register with the city government by the end of the year in an attempt to weed out mafia-run companies.


"There must be a limit to the number of casinos," said Yuri Zagrebnoy, a spokesman for the Moscow government. "The city is not just for gambling. We are trying to switch to other priorities, like the production of food."


But it remains unclear how dozens of existing gambling establishments are going to be closed down.


"I doubt that I would set a quota on the number of casinos, but there are many casinos in town that were set up haphazardly and where clients risk being cheated," said Jim Wrethman, a manager at Metelitsa Casino, one of Moscow's largest.


"If you allow casinos to operate without legislation, some fly-by-night operators will take advantage."


According to city officials, that is exactly the point of their crackdown on gambling establishments.


"Gambling is quite a special business," said Zagrebnoy. "Criminal structures tend to organize around it. Casinos exist on dirty money, and there's more and more dirty money around."


Zagrebnoy said no one had any idea of the number of casinos in Moscow, their turnover or the taxes they pay or evade. "I'm sure we've left Europe far behind as far as the number of casinos goes," he said.


According to Wrethman, there are about 60 establishments in Moscow that call themselves casinos, but many of them are small operations with only two or three gaming tables.


An employee at Moscow's first casino, Moskva, said he was not worried about his establishment being closed down.


"People are used to our casino," he said. "There are a number of small gambling joints in this neighborhood, but people still come here."


Wrethman, too, said he was not worried about the future of his operation.


"We can't see any reason why we shouldn't stay open," he said. "We are the biggest and the best."


The Metelitsa manager said it would probably be the smaller operations, not the big, established casinos that would be closed down.


But Moscow's mammoth bureaucracy may give casino owners an unexpected reprieve as officials puzzle over ways to cut the number of gambling establishments. Though the deadline for working them out passed on July 12, city officials said Monday they needed another week or 10 days to finalize their proposals.


Svetlana Korolyova, an official at the Moscow Consumer Market Department, said city bureaucrats had been caught unawares by the order.


"There are three city departments overseeing the gambling business, and we don't even know how to approach it," she said. "There are no gambling business experts in this country."


Korolyova added she was sure that the number of casinos would not simply be cut arbitrarily, but that establishments would be considered on their merits. She gave no indication of what the criteria would be.