Public Assistance Fraud Alleged By Woman Who Failed to Report $190,000 in Casino Winnings

Posted on: December 9, 2019, 07:55h. 

Last updated on: December 9, 2019, 11:01h.

A Minnesota woman who allegedly won over $190,000 from the state’s Mystic Lake Casino while on public assistance was arrested recently for under-reporting income. That arrest followed a lengthy investigation by state and county officials.

A woman winning over $190,000 from Minnesota’s Mystic Lake Casino allegedly failed to report the income when applying for public assistance. (Image: Shakopee Mdewakanton)

Connie Linh Tran, 49, of Anoka County, was charged with wrongfully obtaining public assistance, according to WCCO TV News. Between 2016 and July 2018, Tran allegedly was given over $28,000 in benefits through the Supplemental Nutrition Assistance Program (SNAP).

Tran’s actual income over the three-year period was higher than the financial guidelines for the benefits. She got $24,914.61 in medical assistance and $3,291 in food support, WCCO said.

Tran said she was basically living from income earned working at nail salons, unemployment compensation, and money given to her from a relative. She claimed to have no gambling winnings.

She reported a household income of $15,614.80 in 2016, $24,493 in 2017, and $26,176 in 2018, WCCO said. But she also had total checking account deposits of $61,913.82 in 2016, $171,205.76 in 2017, and $85,388 in 2018 through August 23, the WCCO report adds.

Investigators were told by a compliance official at Prior Lake’s Mystic Lake Casino, which is owned by the Shakopee Mdewakanton Sioux Community, that between 2017 and May 6, 2018, Tran won $190,896.69, WCCO reported.

If Tran is convicted, she could spend as many as 10 years in prison, the station adds.

Properly Report Gambling Winnings to Government Agencies

The incident illustrates how US government programs require applicants and taxpayers to report income earned from winnings at casinos. For instance, the Internal Revenue Service (IRS) requires a taxpayer to report the full amount of gambling winnings for a specific year on Form 1040 line 21.

Taxpayers may receive a Form W-2G. Even if they do not receive the form, “Gambling winnings must be considered in determining your filing requirements,” the IRS warns.

The IRS further advises that winnings include “money and/or the fair market value of bonds, cars, houses, and other non-cash prizes.” One example the agency provides is someone who purchases a raffle ticket for a dollar and wins a $40,000 boat. “You must include $40,000 in income.”

The winnings that need to be reported do not only come from casinos. Winnings from bingo games, lotteries, various table games, raffles, prize contests, private party games, tournaments, scratch-off tickets and similar events also need to be reported, the IRS says on its website.

When it comes to gambling losses, taxpayers need to itemize deductions on Form 1040 Schedule A to deduct gambling losses. The losses are listed on the “Other Miscellaneous Deductions” line found on Schedule A.

The amount for deductions cannot exceed the winnings amount reported on Form 1040, the IRS further advises.

Minnesota Tribal Casinos Do Not Want Sports Betting

Also this year Charles Vig, the chairman of the Minnesota Indian Gaming Association, wrote to Governor Tim Walz, a Democrat, and all four legislative leaders to say that not only do the state’s influential tribal operators not want sports betting in their casinos, they will actively oppose any legislative effort to legalize sports books this year.

But the sponsor of a proposal, State Senator Roger Chamberlain, R-Lino Lakes, told Minnesota Public Radio News he will try again next year to legalize sports betting after a bill failed to get approval.

Minnesota’s tribal operators do not contribute a portion of their revenues to state coffers, something that has been a bone of contention over the years.