Procedures are questioned at state pari-mutuel agency

The three nephews of Lakes Region Greyhound Park track general partner Allan E. Hart, two of whom were managing the track for more than a decade, were all convicted of charges relating to illegal gambling operations in Massachusetts.

All of the brothers pleaded guilty, no one served any time and the convictions are now more than 15 years old. But the question remains: How have the criminal records apparently escaped the notice of state regulators since 1991, when the Hart family took over the race track? New Hampshire law forbids a racetrack from knowingly hiring anyone with a state or federal illegal gambling conviction in the past 10 years.

Track general manager Richard J. Hart was indicted last month for his alleged role in a massive offshore gambling conspiracy involving organized crime. Hart has pleaded innocent. The track was not charged in the indictment, and Allan Hart — while admitting he was involved in setting up the operation — said that it was legal and was not connected to the track.

The state is now in the process of re-evaluating the extent of state Pari-Mutuel Commission’s licensing and background check procedures.

Richard Hart, of Londonderry, was convicted of taking part in a sports betting conspiracy in September 1988, according to documents in the Suffolk County Superior Court in Boston. He was sentenced to six months probation and fined $3000

Kenneth C. Hart, of Concord, was convicted of the same charge on the same date, according to the Suffolk County documents. He was an operations manager at the Lakes Region track at least as far back as June 1998, according to an article in The Union Leader. He was sentenced to a year probation and fined $1,000

Their brother Robert L. Hart Jr., pled guilty to usury in Middlesex County in Massachusetts in March 1991. The charge, according to a superior court judge’s ruling — “related to the activities of a highly organized and discipline gaming and loan-sharking organization.”

Hart was sentenced to two years’ probation, fined $1,250 and was ordered to reimburse the state $9,000 for the cost of his prosecution.

Key roles

While New Hampshire law prohibits a track from knowingly employing anyone with an illegal gambling conviction in the previous 10 years, Richard Hart and Kenneth Hart both worked at the Lakes Region track within a decade of their convictions.

Richard Hart was the track’s operations manager by 1992, and Kenneth Hart was an operations manager by June 1998, according to Union Leader articles written at the time.

In addition, Kenneth Hart testified in an unrelated Merrimack County lawsuit that his mother Joan G. Hart, who owned 50 percent of the race track, was “just a legal figurehead” for the ownership interest of Kenneth, Richard and Robert in the track since 1991, and that ownership was being transferred formally in 2003, though he could not supply any documentation of that transfer at that time.

The Lakes Region track is supposed to disclose “any felony convictions of any officer, director or holder of an ownership interest of any degree” to state regulators, and the state attorney general is supposed to conduct background checks on such officials.

It is not clear whether any of the convictions would be considered a felony, which is by common law definition punishable by at least a year in prison, but Kenneth Hart apparently thought they posed a problem, according to his deposition in the Merrimack County lawsuit.

When forming the New Hampshire Gaming Association, the limited partnership that runs the Lakes Region track, “because of underlying circumstances with me, Bob and Rick at the request of Al Hart and Vincent DiCesare (another part-owner of the track) we would put Joan as the owner of record because of licensing and issues.”

Kenneth Hart later spelled out in the same deposition that the “issues” were the three brothers’ criminal records.

In 1990, and again in 1995, Kenneth and Richard unsuccessfully tried to seal the Massachusetts convictions on the grounds that they were detrimental to their employment.

Richard Hart wrote in his request to seal the records that they “reflect a point in my life from which I have graduated,” adding that he had “capitalized on this event as a learning experience from which positive results have come.”

Kenneth Hart wrote that the “offenses occurred at a time in my life when my judgment was influenced by the immaturity of my years … Although I have learned from this experience and have focused my energies on more productive means, I remain haunted by these records of my past act of indiscretion.”

Last month, on Jan. 18, Kenneth Hart did obtain a court order to seal the records, though the Suffolk County clerk did not have any record of the latest order and allowed a reporter to examine the file.

“It was a minor infraction that has been sealed, and under the law it is treated as if it does not exist,” said Mark Derby, a Concord attorney who represents Kenneth Hart, as well as Robert Hart. Derby would not say why the court sealed the records and said that neither client would comment further at this time.

The charges against Richard Hart and Kenneth Hart relate to a sports betting ring that allegedly involved 13 others in the Boston area during 1987.

Three years later, Robert Hart faced similar charges involving telephone sports betting, with a different ring of 18 other co-conspirators, but prosecutors decided to drop these charges. Instead, Hart pled guilty to violating usury laws, which prohibit lending at interest rates of more than 20 percent without reporting it to authorities. The loans were allegedly made to a bookmaker who was cooperating with authorities, according to a judge’s memo on a motion to suppress evidence. Robert Hart was sentenced in 1991. Eight months later his mother and uncle signed an agreement to purchase the track.

Messages left with Al Hart and Richard Hart were not returned by deadline.

Expanded rules

While there is no documentation of the three brothers’ ownership interest of the track, if it exists at all, there is no doubt that Kenneth and Richard Hart were deeply involved in managing the track.

In a 1998 Union Leader article, Allan Hart reportedly said, “Rick and Ken run the security, custodial, administrative, racing and pari-mutuel departments and the restaurant.”

Kenneth Hart left as an employee of the track in 2002, according to his deposition. He still considered himself an owner, according to that deposition. Richard Hart was put on unpaid leave shortly after his indictment in January.

Asked by New Hampshire Business Review whether anyone in the management of the Lakes Region track had a criminal record, Pari-Mutuel Commissioner Timothy Connors replied, “I should hope not.”

As of Jan. 1, 2005, the commission expanded its rules to license virtually every employee at a racetrack, including the general manager. Before that, only those who were directly handling dogs were licensed.

The license application asks whether the applicant has been convicted of a crime.

Background checks on employees are conducted randomly by State Police. Pari-Mutuel Commission Executive Director Paul Kelly said that such a check was done on Richard Hart when the new law went into effect and that nothing was found, but he was under the impression it was only conducted in New Hampshire.

Besides, even if something were found, the older conviction would not have prevented Richard Hart from employment this year, since that conviction is more than ten years ago.

The background check on track owners is broader. In addition to any felony conviction the check should include “information as to the subject’s financial, criminal or business background, or any other information which the attorney general in the attorney general’s sole discretion, may find to bear on the subject’s fitness to be associated with racing.”

But since the track wasn’t in the brothers’ name, their record would not have been checked.

The state attorney general’s office is now looking at broadening the background check as part of its ongoing investigation into the Lakes Region track.

“It is going to have to wait for the outcome of that investigation,” said Wynn Arnold, who advises the pari-mutuel commission for the attorney general’s civil bureau. “We need to see what problems we caught and what we didn’t catch.”

“It’s been on the back burner for quite some time,” said Connors of the expanded background checks. “We want to check everybody, anybody who has anything to do with the racetrack — the whole nine yards.”

He called such a process “arduous” and “very time-consuming.”

Gambling opponents in New Hampshire said the questions about how and when background checks are conducted is one more example of the commission’s inability to regulate gambling.

“The very idea that the Pari-Mutuel Commission would have missed gambling-related criminal activities of those involved in the track inspires no confidence that the regulators are going to be an independent watchdog of the industry,” said Jim Rubens, executive committee chair for the Granite State Coalition Against Expanded Gambling.