Gambling Cruises To Nowhere
Posted : admin On 3/16/2022UPDATE: As of 2016, cruises to nowhere are no longer available from US ports of call. To learn about alternative cruise vacations, please call 1-800-377-9383. A cruise to nowhere may seem a little crazy, but it’s actually a great opportunity to get away for a quick time and to really experience cruising and all that cruise ships offer. Looking for quick Weekend Cruises or a cruise to nowhere? Explore Cruise Vacation Packages with Norwegian Cruise Line. Voted 'Best Short Destination Cruises'; by Porthole Cruise Magazine. Book your next Weekend vacation on Norwegian Cruise Line today.
SunCruz Casinos offered offshore 'cruises to nowhere', legally transporting passengers into international waters beyond the reach of federal and state gambling laws. In the 2000s (decade), it became known for the involvement of some high-profile lobbyists such as Jack Abramoff, and the murder of its former owner, Gus Boulis.
Founding and investigation[edit]
In 1994 Boulis, already a multi-millionaire by founding the Miami Subs sandwich shop franchise, bought a number of luxury yachts. He remodeled the yachts as casinos, and began to operate his 'cruises to nowhere', departing from the Florida coast into international waters. There, out on the sea, passengers would gamble at high stakes on poker, blackjack and slots. Boulis called his fleet of 11 ships the SunCruz Casino line. By the time he entered into negotiations to sell the company in 2000, SunCruz Casinos was earning tens of millions of dollars in annual profits, and employed over 2,000 people.
Florida state officials made several attempts to shut the business down, finally succeeding in 1999 when federal prosecutors charged Boulis with violating shipping laws over the ship's registration. U.S. shipping code forbids foreign nationals from owning American commercial vessels, and Boulis was a Greek citizen. Boulis agreed to pay a $1 million fine, sell the business, and never work in the gaming industry again. So that Boulis would be able to get a fair price when he sold, the deal with the federal prosecutors would be kept a secret until the deal was closed. In January 2000, Boulis went looking for a buyer.
Purchase of SunCruz Casinos and political ties[edit]
Boulis' lawyer Art Dimopoulos worked at Preston Gates Ellis & Rouvelas Meeds, a large firm in Seattle, Washington. Dimopoulos was tasked with finding a buyer for SunCruz. Jack Abramoff, a lobbyist then employed at the same firm, heard about the situation. Abramoff told Dimopoulos that he knew buyers who would be interested. They included himself, but ethics rules prohibit the same law firm from representing a buyer and a seller, therefore Abramoff hid his interest in the purchase from his firm.
Abramoff enlisted Adam Kidan and Ben Waldman, acquaintances from his College Republican days as partners in the deal.[1] The price was approximately $145 million; Abramoff and his partners would come up with a $23 million downpayment, and then other financiers would release loans.
Press accounts have suggested that Abramoff used his political connections to gain support for the deal in Washington.[2]Tom DeLay, then House minority whip, gave Boulis a flag that had flown over the Capitol building. Abramoff brought his lead financier in the deal to a fund raiser for DeLay in Abramoff's box at FedExField.
Ohio Republican Representative Bob Ney aided the purchase in the House on several occasions. In March 2000, before the deal was closed, Ney entered comments in the Congressional Record accusing the SunCruz management of cheating passengers.
Rep. Dana Rohrabacher (R-Calif.) was listed as a financial reference for Abramoff in the purchase. He was also quoted in The Washington Post as saying 'I don't remember it, but I would certainly have been happy to give him a good recommendation' and 'He's a very honest man.'[3]
On September 22, 2000, in secret, Abramoff convinced Boulis to accept promissory notes for $20 million in exchange for a secret 10 percent interest in the newly reorganized SunCruz Casinos. The deal was doubly illegal: Abramoff and his partners were violating the terms of their purchase agreement with their financiers which required that they put up $23 million of their own money, and Boulis was violating the terms of his settlement with the government, which required that he separate himself entirely from his company.
The deal was closed on September 27, using false documents that purported to attest that Abramoff and his associates had paid the $23 million. On October 26, 2000, Ney entered comments into the Congressional Record praising the change of ownership. Ney later accused Abramoff of duping him.
Payment dispute and murder[edit]
The business relationship soured soon after the fraudulent purchase. Boulis allegedly clashed over the falsified wire transfer with an Abramoff associate. Abramoff was mostly a silent partner, but both he and his partners used SunCruz funds to pay for numerous personal expenses.[4] Boulis also alleged that one of Abramoff's partners had links to organized crime.[5] The relationship between Boulis and Abramoff's partners grew so contentious that he had a fistfight with one of them at a business meeting in December 2000, with both parties allegedly making threats. Boulis was shot to death in Miami two months later in February 2001, in what police called 'a gang style hit'. A lawsuit brought by Boulis' estate alleges that an Abramoff associate made three payments of $10,000 to Anthony Moscatiello immediately prior to the murder.[6]
Abramoff's partners had hired Anthony Moscatiello as a business advisor, despite Moscatiello's previous indictment as former bookkeeper for the Gambino crime family (led by Mafia crime boss John Gotti), paying him $145,000 through SunCruz for services that were allegedly never rendered. Anthony Ferrari also received $95,000 from SunCruz as payment for security services, in addition to further sums in casino chips.
Moscatiello and Anthony Ferrari were charged with murder, conspiracy and solicitation to commit murder. James Fiorillo was charged with murder and conspiracy. In May 2006, an Abramoff associate told authorities that Moscatiello and Ferrari confided in him that another Gotti associate, John Gurino, killed Boulis. Gurino himself was killed in October 2003. Gurino previously wasn't part of the investigation.[7]
Bankruptcy, investigations and indictments[edit]
SunCruz declared bankruptcy in June 2001, and was subsequently auctioned off to new management in a bankruptcy action brought by Foothill Capital. Abramoff signed his stake in SunCruz over to the Boulis family estate, and another associate later turned over his stake for $200,000. Foothill settled with Abramoff for an undisclosed sum, and continued litigation against his partner.
To further support the loan application, both Abramoff and an associate provided personal financial statements. The lenders relied on both financial statements, and the counterfeit copy of the wire funds transfer, deciding to approve and fund the loan. Some of the proceeds of the loan were then wire-transferred to the account of Gus Boulis at Ocean Bank, in Miami, Florida. The copy of the wire funds transfer notification reflecting the transfer of $23 million from the buyers to the seller was fraudulent, as no such transfer of funds ever occurred, and the buyers had never made any cash contributions toward the purchase of SunCruz. Similarly, the personal financial statements provided to Foothill by Abramoff and his associates contained false information concerning their respective assets and liabilities.
On January 4, 2006, Abramoff pleaded guilty to conspiring to commit wire fraud and mail fraud, and of a separate charge of wire fraud, relating to the SunCruz purchase.[8] On March 29, 2006, Abramoff and one of his partners were sentenced to five years and ten months in prison -— the minimum allowed per the plea bargain -— and were ordered to pay restitution of more than $21 million for their involvement in the SunCruz casino deal.
Connections to Congressman Bob Ney[edit]
According to The Washington Post, Bob Ney came under investigation by prosecutors for his role in aiding the purchase,[9] and was implicated in Abramoff's plea agreement.[8] (In a separate Indian lobbying case, Abramoff pleaded guilty to charges including bribing a Congressman who was later identified as Ney.)
In March 2000, before a deal for Abramoff and others to purchase SunCruz was closed, Ney entered comments in the Congressional Record that were critical of the management of SunCruz: 'Mr. Speaker, how SunCruz Casinos and Gus Boulis conduct themselves with regard to Florida laws is very unnerving. Florida authorities have repeatedly reprimanded SunCruz Casinos and its owner Gus Boulis for taking illegal bets, not paying their customers properly and had to take steps to prevent SunCruz from conducting operations altogether.' It is alleged that this statement was intended to pressure SunCruz to sell to Abramoff on terms favorable to the latter.
It is alleged that Ney, like other Republicans in the House, was under pressure to raise money for the Republican National Congressional Committee (RNCC) in October 2000, a month prior to the November elections. In an October 23 e-mail from Abramoff to business partner Michael Scanlon, Abramoff asked 'Would 10K for NRCC from Suncruz for Ney help?' Scanlon replied, 'Yes, a lot! But would have to give them a definite answer--and they need it this week...'
The $10,000 was sent to the RNCC within days, and Ney got credit for raising it. Scanlon wrote a draft statement for Ney that Adam Kidan, the main partner of Abramoff in purchasing SunCruz. Ney then inserted the statement into the October 26 Congressional Record.[10]
References[edit]
- ^[1]Archived September 6, 2006, at the Wayback Machine
- ^Grimaldi, James V. (August 12, 2005). 'Abramoff Indicted in Casino Boat Purchase'. The Washington Post. Retrieved May 24, 2010.
- ^Schmidt, Susan; Grimaldi, James V. 'Untangling a Lobbyist's Stake in a Casino Fleet'. The Washington Post. Retrieved May 24, 2010.
- ^July 26, 2015. 'News that Matters to American Jews'. The Forward. Retrieved 2015-07-26.[dead link]
- ^Grimaldi, James V. (August 12, 2005). 'Abramoff Indicted in Casino Boat Purchase'. The Washington Post. Retrieved May 24, 2010.
- ^[2][dead link]
- ^'Businessman Kidan claims killer of SunCruz Casino founder is dead'. South Florida Sun-Sentinel. June 9, 2006. Archived from the original on June 16, 2006.
- ^ ab[3]Archived January 10, 2006, at the Wayback Machine
- ^Grimaldi, James V.; Schmidt, Susan (October 18, 2005). 'Lawmaker's Abramoff Ties Investigated'. The Washington Post. Retrieved May 24, 2010.
- ^[4]Archived January 18, 2006, at the Wayback Machine
External links[edit]
A cruise to nowhere by definition is a short itinerary that sails roundtrip from a port of call without making any stops.
Essentially, the ship leaves port and sails in a big circle only to return a day or two later.
This type of cruise was generally most common when a short itinerary was needed to help fill out the schedule of a ship.
For example, if a ship returned to its homeport on a Friday fresh off a special 12-day itinerary and was slated to begin doing regular, 7-day sailings on Saturday morning, the cruise line might opt to throw a one-time-only one-night “cruise to nowhere” into the mix.
Why? Doing so meant that the ship could set sail with passengers and generate revenue rather than spend the night sitting at the dock, racking up port charges and facility fees.
FACT CHECK: Do Cruise Lines Pay Taxes?
Cruises to nowhere were a win/win for the lines, given that they weren’t paying for a ship to sit empty and the amount of revenue generated during the short sailings tended to be fairly high.
After all, on-board spending is known to be higher on sea days than when a vessel is visiting a port and guests are disembarking to spend their money elsewhere. A ship is most profitable when guests are onboard spending money in the casino, the bars and the spa.
Many Americans loved jumping on a quick cruise-to-nowhere, whether to celebrate a special occasion without having to take a full week off work or as a way of taking a ship they’d never sailed on a “test drive” to see what they thought of it.
Unfortunately, those days are over — at least for now — as cruises to nowhere are illegal in the United States.
Why Did Cruises To Nowhere Stop?
Prior to 2016, a number of U.S. cruise lines offered a few one- or two-night sailings without port calls, targeted to first-timers, ocean lovers and gamblers.
They weren’t technically legal then, but officials choose to turn a blind eye to a practice that generated just a tiny fraction of overall cruise industry revenue.
It was a court decision that brought things to a halt.
In 2013, a company called Bimini Superfast, owned by Asian casino giant Genting, began offering gambling-themed cruises to nowhere from PortMiami.
When the company tried to expand its operations to sailings out of Port Everglades, it caught the attention of Customs & Border Protection, which filed and won a lawsuit.
CBP officials told the line that in order to operate cruises to nowhere, they must “employ persons legally authorized to work in the United States, since such cruises did not touch a foreign port.”
As all major U.S.-based cruise lines employ mostly foreign crew, the decision applied to them as well. As a result, cruises to nowhere were discontinued by companies such as Carnival Cruise Line and Norwegian Cruise Line in 2016.
“Due to recent changes in how ships are cleared into and out of the United States by U.S. officials, certain short duration cruises without a foreign port of call are subject to itinerary changes beginning in 2016. Unfortunately, this means that we will not be permitted to operate cruises-to-nowhere,” a spokesman with Carnival Cruise Line told Cruise Radio shortly after the ruling came down.
According to a CBP statement at the time, to be legal, ships offering cruises to nowhere “must be staffed by U.S. citizens or lawful permanent residents authorized to work in the United States.”
The majority of cruise ship crew members hold D-1 visas, which the CBP says makes them eligible to “serve as a crew member on a vessel only if the crew member ‘intends to land [in the U.S.] temporarily and solely in the pursuit of his calling as a crewman and to depart from the United States with the vessel.’”
Since cruises to nowhere do not land in a foreign port or territory, the CBP adds, D-1 visa holders are not eligible to serve as crew members.
The current mass-market cruising model does not support the higher costs that would result from hiring U.S. workers and having to follow U.S. labor laws and protections.
Who Can Sail A Cruise To Nowhere
Technically, there is one U.S.-flagged cruise ship with a majority of crew members who are U.S. citizens: Norwegian Cruise Line’s Pride of America, which offers seven-night cruises around the Hawaiian islands, without a stop at a foreign port.
Conceivably, this ship could be used to operate cruises to nowhere, though it seems unlikely Norwegian would relocate and repurpose the ship from high-margin Hawaiian cruises to sail shorter, lower-cost cruises to nowhere. That said, in these unprecedented times, anything is possible.
Cruise lines can use a cruise to nowhere to show off brand new vessels to media and travel partners, known as a preview or shakedown cruise.
The one condition: the ship has to sail within territorial waters for a foreign port to get signed off.
American-flagged river operators like UnCruise Adventures, Alaska Dream Cruises, and American Queen Steamboat Company can also sail a cruise to nowhere as the law would not apply to them.
Cruise To Nowhere Alternatives
Florida Gambling Cruises To Nowhere
Cruisers can still do quick trips, but the sailings are likely to be at least three-days long because of the requirement that the vessel calls upon a foreign port.
In Florida, you can do three-night cruises from both Orlando (Port Canaveral), Fort Lauderdale (Port Everglades), and PortMiami. These short trips typically run over the weekend and will call to Nassau, Freeport or one of the cruise line private islands in the Bahamas.
In California, shorter itinerary options are typically done from Long Beach or the Port of Los Angeles and will call to Ensenada, Mexico.
Cruises To Nowhere in 2020
Quantum of the Seas will sail cruises to nowhere from Singapore in December 2020. (Photo courtesy of Royal Caribbean)
Cruises to nowhere are being seen by some as a lower-risk way of resuming cruise operations, since there would be no on-shore interactions and the risks that come with them.
Royal Caribbean recently confirmed that it will restart cruising from Singapore on December 1, offering three- and four-night no-stop “Ocean Getaways” for Singapore residents only. The sailings will be aboard the 4,180-passenger Quantum of the Seas, which will operate at half-capacity.
There are also some cruises to nowhere currently being offered in Northern Europe, and Australia has indicated that the concept may play a role when the industry is permitted to restart there.
With the uncertainty of Canadian border reopenings, Alaska State Representative Don Young is pushing to temporarily lift The Jones Act (Passengers Vessel Services Act) in order to allow cruises to sail to Alaska from Seattle.
Lifting the maritime rule would allow ships to sail from the United States without making the compulsory stop in Canada before returning home.
Both the Cruise Line International Association and Alaska Travel Industry Association support The Jones Act waiver. This single action would essentially save the 2021 Alaskan cruise season. The loss of the 2020 season saw the region shed 15,000 jobs and millions of dollars thanks to the loss of all cruise-based tourism.
READ MORE: Passenger Vessel Services Act of 1886
Unless there’s a legislative change, Americans will no longer get to experience a cruise to nowhere, despite the fact that cruise lines see such a product is ideal for introducing first-timers to the concept of a water-borne vacation.
And, in the current situation, short, no-stop sailings could also help re-instill consumer confidence in cruise safety by creating a safe “bubble” with no outside interaction.
Casino Cruises To Nowhere
The bottom-line: until legislation is change, cruises to nowhere are almost certain to remain a non-starter.
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