The Uneasy Business of Selling Slot Machines in Gambling-Free Texas

Unless you are wagering on horses, within the boundaries of the Kickapoo Indian reservation or placing bets directly with the state, gambling is illegal in Texas; after all, vice cops need to have something to do when they're not busting hookers, and besides, the lottery functions much better without private competition.

It's perfectly legal, however, to buy and sell what the state terms a "gambling device" -- i.e. any slot machine, 8-liner, or other contraption that accepts people's money and occasionally spits some back out. It's how Vernon Dennis makes his living.

Dennis owns Lone Star Slots, a small showroom/warehouse in Lancaster. It's tucked away in an aging, bile-hued industrial park on Interstate 35, a hard place to find unless you're looking, and even if you are, it'll probably take you a couple of circuits on the service road squinting at addresses. (Pro tip: Google Maps shows it on the wrong side of freeway.)

See also: Vice Cops Raided an East Dallas Gambling Ring

This is probably by design; though his trade is legal -- he makes every customer sign a disclaimer promising that the machines will be used "in a legal manner for home entertainment purposes." -- Lone Star Slots exists in the same weird legal space as head shops. Selling slot machines, just like selling bongs, is perfectly OK so long as the seller assumes that his wares aren't going to be used for the purpose they were designed for. In both cases, it's best not to attract undue attention.

Dennis is middle-aged with a shaved head, a workman's build filling out his baggy jacket of checked flannel and denim. He clearly wasn't thrilled about the prospect of talking to a reporter, but he was friendly enough. A Grand Prairie couple accused of running several illegal game rooms in East Dallas had purchased some of their video gambling machines from Lone Star Slots, an allegation we mentioned on Monday, and Dennis was anxious to prove both that 1) he operates on the up-and-up and 2) he doesn't snitch to police unless forced to by subpoena.

Lone Star Slots is a successor of sorts to Casino Slots, which used to be off Loop 12 near Dallas Executive Airport. Dennis worked there until the owner bought several thousand gaming machines damaged during Hurricane Katrina on the cheap, fixed them up and sold them for what Dennis says was a $25 million profit. The owner subsequently lost interest in the business and, about five years ago, transferred his remaining inventory to Dennis, who started Lone Star Slots.

According to Dennis, the market for living-room gaming devices is brisk. He has between 300 and 400 in his warehouse at any given time, along with the odd arcade game or pinball machine. As a general rule, coin-fed slot machines are most popular because customers like the clinking sound the coins make as they fall in the bucket, though newer models tend to be designed for cards. There's not really a prototypical customer. Some buy them as gifts for an aging mother or grandmother, others for themselves. He remembers one woman who bought a house full of gaming machines, which were the centerpiece of the neighborhood gatherings she liked to host. Most of his business, though, is doing repairs, usually fixing burned-out batteries.

Police had never visited Lone Star Slots, Dennis says, until they tailed Thuy "Tweety" Kha and her boyfriend, Andy Nguyen, the couple who allegedly ran the the East Dallas game rooms, to his door. He remembers Kha as pretty but tough-nosed, always trying to haggle him down on price. He was surprised to learn that an analysis of 37 of the couple's gaming machines (police seized 169 total) recorded $1.1 million in profit between August 2014 and January 2015. They dressed plainly and drove normal cars; they didn't seem like millionaires.

Dennis isn't accused of wrongdoing in the case. According to police, who subpoenaed his business records, he sold Kha $18,530.14 worth of equipment. (Police don't specify what she bought, but Dennis' electronic machines are advertised for about $1,500.) At the time of purchase, she signed Lone Star Slots' disclaimer swearing that she was using the games "in a legal manner for home entertainment purposes."

That said, Dennis worries that the episode could hurt business. Not because Lone Star Slots is now indirectly associated with some illegal game rooms but because the business now might be connected in people's minds with the police. Never mind that he was legally required to cough up Kha's records; in Dennis' part of town, someone who cooperates with the cops is a snitch, and that's a near impossible reputation to shake.

Send your story tips to the author, Eric Nicholson.

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Eric Nicholson
Contact: Eric Nicholson