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Culture of Corruption May Contribute to KY Gov.'s Decisions

Added on: Feb. 10, 2013

You didn't have to be a partial observer to raise questions about the motivations of the state of Kentucky, and in particular the man at the very top, when it came to his attempts to shut down the online gambling industry his own way in 2008. What maybe isn't so obvious is that the move was rooted in politics, plain and simple, and the kind of politics that is a by-product of a culture of corruption at that.

It was never any secret that Governor Steve Beshear was actively trying to protect campaign contributors with political interests and eliminate outside competition when he began his domain assault on the online gambling industry in 2008. But even before Beshear went about the very reckless action of seizing gambling-related domain names, his own name had been raised in connection with some very questionable practices in campaign fund-raising. One of the things that stuck out like a sore thumb and was revealed to the public was a mammoth contribution on the part of a gentleman named William Yung.

Yung made a political donation in the amount of $1 million to Beshear's campaign, which was pushing the expansion of gambling, not just into Kentucky's pari-mutuel facilities but also free-standing casinos that would exist in border towns next to Indiana, Tennessee, West Virginia and Ohio. Yung was explicitly interested in building a casino on a plot of land he had purchased near the Ohio border. Yung had paid $7 million for the land, and backed it up with the $1 million campaign contribution. Yung seemed to need some political "juice," since New Jersey refused to grant him a new license for the Tropicana in Atlantic City and Indiana did the same in connection with Yung's operation of the Casino Aztar in Evansville.

Also, there were $3,150,000 in contributions that came to benefit Beshear's campaign in the name of a 527 political organization called the "Bluegrass Freedom Fund," with $2.2 million of that money coming directly from individuals and entities in the casino and racing industries that stood to benefit from expanded gambling. People started to question whether his platform came first or the money came first. Beshear denied having any connection with Tracy Farmer, the founder of the Bluegrass Freedom Fund, after that 527 was formed, but that was contradicted by photographs of the two together at public events.

Among the large contributions made to the BFF were a quarter of a million apiece from Churchill Downs, Phoenix Capital (controlled by Keeneland Race Course) and EP Acquisitions (controlled by the ownership of Ellis Park), $125,000 from Turfway Park, another pari-mutuel facility and $60,000 from the owners of The Red Mile, a harness racing track. There was also $150,000 that came from various members of a group looking to establish a quarter horse racing track.