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Casino Backers Fund Schwarzenegger Campaign

SACRAMENTO, California – As reported by the Associated Press: "When they organized a $1 million fund-raiser for Gov. Arnold Schwarzenegger in February, Sacramento Kings owners Gavin and Joe Maloof's family casino business was negotiating a deal that would net them millions from running what could be one of the world's largest casinos, according to interviews and state records.

"Six months later, Schwarzenegger announced a deal for a tribal megacasino that will be managed by a company partially owned by the Maloofs. The Maloof fund-raiser means that Schwarzenegger, who campaigned on a refusal to take money from Indian gambling interests, received huge contributions through those connected to gambling businesses.

George L. Maloof Jr., who runs the family's Palms Casino Resort in Las Vegas, said he'd discussed the deal before the fund-raiser, but said his brothers weren't involved at the time and the agreement wasn't signed until afterward.

…The Maloofs publicly emerged only two weeks ago as players in the deal. Schwarzenegger spokesman Vince Sollitto said that's when the administration learned of their involvement as well.

…Bob Stern, president of the Center for Governmental Studies, said Schwarzenegger should refund the $64,505 contributed by Maloof Sports and Entertainment.

…Despite once saying he didn't need special interest money, Schwarzenegger has raised campaign funds at an unprecedented pace, much of it from interests with bills passed by the Legislature and now awaiting his signature or veto.

At the time of the fund-raiser, Joe and Gavin Maloof bragged they'd raised more than $1 million for Schwarzenegger by hosting $100,000 and $25,000 per person fund-raisers before and during a Kings game in February.

…If the San Pablo casino deal is approved by the Legislature and U.S. Interior Department, the Maloofs are set to collect about 20 percent of the profits from a planned 200,000 square-foot casino projected to take in $540 million a year…"

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