Over 20 defendants and their attorneys packed the San Diego federal court house on April 18. Charges for the defendants and their businesses ranged from alleged illegal bookmaking, illegal money-laundering, prostitution, and “failure to maintain an anti-money-laundering program.”
A two-year-long probe by the FBI resulted in extensive raids on December 9, 2015. A U.S. Attorney’s press release from that time explained, “More than 200 agents from the FBI, Homeland Security Investigations and the IRS plus San Diego County Sheriff’s deputies and investigators from the California Department of Justice bureau of Gambling Control served five search warrants and 22 seizure warrants in Chula Vista, San Diego and elsewhere. The search and seizure locations included the Village Club Card Room, also known as Seven Mile Casino in Chula Vista, and the Palomar Card Club in San Diego.”
According to the news release, several defendants allegedly operated unlicensed casinos out of Rancho Santa Fe mansions. Millions of dollars in proceeds from the gambling activity were laundered through the Palomar and Village Club card rooms, Las Vegas casinos, bank accounts, shell companies, and a bail-bonds business.
Out of the 25 defendants initially charged, 3 have now pleaded guilty.
On April 18, the owner of the Seven Mile Casino, Harvey Souza, and Naseem Salem, general manager of the Palomar Card Club, were among the defendants in court.
As the Reader reported on April 15, the Palomar Club’s license has been revoked.
Subsequent to publication, Eric Petosky of the California Gambling Control Commission said, "Both the cardroom and the owners have Interim Renewal Licenses (granted last November). The CA Gambling Control Commission referred the case to an Administrative Procedures Act hearing, but there has not been a hearing date scheduled to my knowledge."
Judge Marilyn Huff presided over the courtroom on April 18. Huff called the case “complex” and said it was too soon to set a reasonable trial date.
A status conference for discovery was set for June 20 and a motion hearing on October 17.
Assistant U.S. Attorney Ryan A. Saucedo told Huff that the government was still wending its way though over 1000 wiretaps and 1000 documents and expects an additional batch to be finished in early May.
San Diego attorney Michael Pancer is representing the Village Cardroom (aka Seven Mile Casino) and Souza. In an April 21 statement to the Reader, Pancer said, “Mr. Souza successfully ran cardrooms in Chula Vista for over 45 years. Up until this time he never had a problem and was considered a real asset to the Chula Vista community. He was active in community affairs and well-liked with nothing but the best relationship with law enforcement. We are hopeful for a good resolution in this case so he can continue to be an asset to that community.”
Pancer’s comments conform to a Chula Vista Star-News article that ran shortly after Souza’s indictment, titled “Card room owner deals in generosity,”
Patty Chavez, director of South Bay Community Services’ communications department, told the Star-News "she didn’t know Souza very well but the interactions she’s had with him were mainly about how he could help South Bay Community Services. 'Throughout the years he’s helped with the domestic violence shelter and he’s helped with Mi Escuelita and he’s donated to our foster youth program.'”
Former Chula Vista mayor Cheryl Cox also praised Souza. The article said Cox, who previously worked as a consultant for Souza ”doesn’t know what to think about Souza’s money laundering charge but says that she still supports him.”
In addition to Souza’s philanthropy, "Cox said Souza’s two biggest community contributions come from the revenue he generates for the city and the number of jobs he brings to Chula Vista."
However, county supervisor Greg Cox, spouse to Cheryl Cox, returned Souza’s (and his wife Bette’s) campaign contributions. The campaign disclosures for the Friends of Greg Cox for Supervisor 2016, filed during the last filing period, show that Harvey Souza’s $745.25 non-monetary contribution and Bette Souza’s $745.25 non-monetary contributions from June 3, 2015, were returned.