By Barbara Liston
ORLANDO, Florida (Reuters) - A Florida attorney was found guilty on Friday of running an illegal gambling operation that was disguised as a veterans' charity and mushroomed into a multimillion-dollar Internet gaming racket.
A jury in the central Florida city of Sanford found Jacksonville lawyer Kelly Mathis guilty on all but one of 104 counts against him.
The charges included possession of illegal slot machines, helping to operate an unauthorized lottery and racketeering.
Mathis was the first of 57 people charged in the Allied Veterans of the World case to go to trial.
The non-profit organization claimed to be running Internet cafes to raise money for veterans. But prosecutors said the network of cafes run by the group were actually computer casinos and few proceeds from the operation actually went to any charity.
The case prompted Florida's Lieutenant Governor Jennifer Carroll to step down earlier this year because she had worked as a consultant for Allied Veterans. It also spurred a decision by the Florida Legislature to ban Internet cafes.
No charges of any wrongdoing have been brought against Carroll. Mathis had claimed he was merely acting as an attorney, giving legal advice to Allied Veterans.
The investigation called "Reveal the Deal" uncovered what law enforcement officials described as a "sophisticated racketeering and money laundering scheme stemming from 49 illegal gambling centers operating under the guise of Internet cafes." Investigators said less than 2 percent of the proceeds went to charity.
"The organization falsely claimed to be a charitable veterans' organization, but instead deceived the public and government while lining the pockets of its operators," the Seminole County Sheriff's Department stated in a press release.
The investigation began in 2010 after a World War Two veteran stopped into an Allied Veterans storefront and said to himself, "My God this isn't about veterans, it's a casino," said Seminole County Sheriff Donald Eslinger.
Investigators seized slot machines and records from Allied Veterans' gambling centers across the state, as well as 80 vehicles and vessels, 170 properties and 260 bank accounts estimated to be worth tens of millions of dollars.
Among those arrested were the former national leader of the organization, the current leader and the owner of a company that was alleged to have provided the software used by the gambling centers.
(Editing by Tom Brown and Jackie Frank)