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Sanborn defends casino license by blaming state for ‘sloppy’ investigation

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Sanborn defends casino license by blaming state for ‘sloppy’ investigation

Dec 11, 2023 | 4:53 pm ET
By Annmarie Timmins
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Sanborn defends casino license by blaming state for ‘sloppy’ investigation
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Leila McDonough, auditing administrator for the New Hampshire Lottery Commission's Investigation and Compliance Division, testified that Concord Casino owner Andy Sanborn was uncooperative with her office. (Annmarie Timmins | New Hampshire Bulletin)

A business consultant, not Concord Casino owner and former state Sen. Andy Sanborn, submitted applications for nearly $844,000 in federal pandemic assistance that now threatens the future of Sanborn’s gaming license, his attorneys said at a hearing Monday.

Lawyers Zachary Hafer and Mark Knights also refuted on Monday the state’s allegations that Sanborn illegally used the federal money to pay himself rent and to buy two Porsche race cars for himself and a Ferrari race car for his wife, state Rep. Laurie Sanborn, a Bedford Republican. The investigation led Sanborn to resign her position as chairwoman of a legislative committee investigating the impact of new gaming laws. 

“The evidence will show at the end of the day that Mr. Sanborn and (his charitable gaming company) Win Win Win relied on the advice of somebody they had reason to believe was an expert, a specialist in (Small Business Administration) loans,” Knights told Department of Safety hearings officer Michael King, who will decide the fate of Sanborn’s license. “And that’s not fraud. There is no intent to deceive. It doesn’t even come close to fraud.”

The consultant identified by the defense team, Michael Evans, of SpringWest Capital Corp. in New York, did not return messages seeking comment Monday. 

Sanborn paid Evans nearly $11,600 for his assistance with the loan application, Leila McDonough, auditing administrator for the New Hampshire Lottery Commission’s Investigation and Compliance Division, testified Monday.

The New Hampshire Lottery Commission has moved to suspend Sanborn’s gaming license indefinitely for allegedly illegally applying for the federal assistance, since it cannot be used for gambling, and then misappropriating it for personal gain. The commission also alleges Sanborn failed to file “true and accurate” financial records of his gaming operations. 

Senior Assistant Attorney General Jessica King said Monday that the state must prove only one of its allegations by a preponderance of the evidence, which is lower than the proof beyond a reasonable doubt threshold, to revoke Sanborn’s license. 

It was unclear Monday how long before King would issue his ruling. Sanborn’s gaming license expires Dec. 31. If King does not rule in Sanborn’s favor before then, Sanborn will lose his license pending the outcome of this case.

Meanwhile, the Attorney General’s Office is investigating the Sanborns for possible criminal charges in connection with the loan and has referred the case to the United States Attorney’s Office, District of New Hampshire, for investigation. 

Here are four takeaways from Monday’s hearing.

Sanborn won’t testify.

The Sanborns did not attend Monday’s hearing because they were at Dana Farber Cancer Institute, Hafer told King. Hafer has told reporters and the New Hampshire Lottery Commission previously that this case has been especially difficult for Sanborn because he is contending with serious health issues. 

Hafer said he has also advised Sanborn against testifying.

King said he would determine in his final ruling whether to make a “negative inference” from Sanborn’s absence and decision not to testify.

Lottery officials found Sanborn difficult.

McDonough testified Monday that she found it difficult to get the required financial filings from Sanborn on time. Records came in with revisions, which she said raised questions about whether the charities Sanborn was renting his gaming room to were getting 35 percent of the proceeds, as required. 

McDonough said Sanborn refused to tell her what internal control steps he had taken to ensure the gaming proceeds were handled and recorded properly. And, his business and tax records showed discrepancies in his yearly income, she said. 

When pressed for records and information that he is required to provide, Sanborn became difficult, McDonough said.

“There have been some troubling game operator employers but he’s been the most difficult and challenging to work with,” she said. “He’s gone to the governor. He’s gone to my boss. He’s gone to my boss’s boss. He’s gone to my boss’s boss’s boss. He wants to have his way and I just want compliance. I don’t want to fight with him.”

Sanborn defends casino license by blaming state for ‘sloppy’ investigation
Attorney Mark Knights told Department of Safety hearing officer Michael King that Concord Casino owner and former state Sen. Andy Sanborn did not misappropriate $844,000 in federal pandemic assistance. (Annmarie Timmins | New Hampshire Bulletin)

The defense calls the state’s investigation “sloppy.”

The Attorney General’s Office, which presented the case against Sanborn on Monday, said McDonough will be the only witness it calls. That’s a sign of a weak case, the defense argued Monday.

Knights said it’s noteworthy that the state has not asked someone from the Small Business Administration, which oversees the loans at the center of this case, to testify. Nor did the state do a forensic audit of Sanborn’s filings, he said. 

“What you just heard was a story,” Knights said after the state summarized its case against Sanborn. “And it’s a pretty good piece of revisionist history. It’s an incomplete story that has yawning gaps in the evidence as a result of an incomplete and frankly sloppy investigation.”

Knights said the state’s allegations are “based on fraud that didn’t happen perpetrated against the federal agency that they never spoke to and you’re not going to hear from today.”

The Attorney General’s Office has not released its investigative files, which would indicate what it has based its allegations on. 

The Sanborns received millions in pandemic assistance.

In addition to the $844,000 Sanborn received for Win Win Win, he and his wife received a similar COVID-19 Economic Injury Disaster Loan, bringing the total to $3.2 million, McDonough testified. Those loans must be repaid. 

Win Win Win also received $286,682 from the Main Street Relief Fund for small businesses, according to a state database. The Draft, Sanborn’s Concord bar and restaurant that is home to Concord Casino, received $15,000 from the Local Restaurant Infrastructure Investment Funds Program. 

Win Win Win received nearly $60,000 as part of the Paycheck Protection Program, all of which was forgiven, according to a database. The Draft received $228,720 as part of the program. Those loans were forgiven as well.

The Lottery Commission’s case pertains only to Win Win Win’s $844,000 in Economic Injury Disaster Loans.