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State agency takes action on alleged gambling locations in Anchorage

Published: Mar. 29, 2022 at 5:38 PM AKDT
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ANCHORAGE, Alaska (KTUU) - A state agency is taking action after Alaska’s News Source began investigating two Anchorage arcades back in late February.

It began after several patrons spoke with Alaska’s News Source with allegations of illegal gambling.

“A referral was made to the appropriate law enforcement agency for the criminal allegations,” said Michele Hearn, an investigator with the Division of Corporations, Business and Professional Licensing.

Hearn also confirmed that West Side Arcade at 3600 Minnesota Drive in Anchorage was operating without a business license on Feb. 25 when Alaska’s News Source went undercover with a hidden camera at that location and one other arcade located at 369 Muldoon Road in East Anchorage.

At the Muldoon arcade location, one of the workers showed the reporter how to use the machines, politely introducing himself as “Omar.”

In early March, when Alaska’s News Source interviewed a patron of West Side Arcade, the patron, who asked not to be named, said he introduced a friend to the arcade.

“First time he went there, he turned 20 bucks into $1,400,” the patron said.

Several other patrons have told Alaska’s News Source they believe both locations are fronts for illegal gambling.

When Alaska’s News Source visited West Side Arcade, it took only minutes before a player made it known that he had scored some cash, confirming it was at least a hundred dollars.

Alaska’s gambling ban doesn’t apply to traditional arcade games. An amusement device is considered legal if it “confers only an immediate right of replay, not exchangeable for something of value.” Allowable items would include tickets or credits that can be redeemed, but not cash payouts.

After an initial investigation, Alaska’s News Source went back to West Side Arcade a few days later to attempt to speak with management. “Omar” opened the door, the same man Alaska’s News Source first met at the Muldoon arcade.

When asked if he was the manager, Omar replied, “I just work here,” and denied any wrongdoing.

When Alaska’s News Source asked Omar about allegations by at least one patron who claims to have received money after playing the games at the West Side Arcade, Omar asked the reporter to leave the property.

Alaska’s News Source has continued to investigate in an effort to determine who owns the two arcades. An Alaska business license for West Side Arcade lists the owner as Clayton Victor Peters.

According to court documents, Clayton Victor Peters was formerly known as Clayton Victor Paogofie Nai until 2013, when he legally changed his name to Clayton Victor Peters.

Public records for Peters’ business, West Side Arcade, led to an address in East Anchorage. When Alaska’s News Source visited the location looking to speak with Peters, a familiar face came to the door. That man appeared to be the same person who first introduced himself as Omar.

Alaska’s News Source attempted to determine Omar’s identity asking, “Omar? Clay Peters?”

Omar replied, “I don’t want to talk to you” and went on to say, “What you’re doing is harassment. Go find something better to do. How about you try Jesus and not me?”

Alaska’s News Source left the location without answers, including Omar’s legal identity.

As for the West Side Arcade’s ownership, Alaska’s News Source found the arcade is part of a commercial property, a strip mall, that’s owned by the Varner family in Anchorage. Alaska’s News Source asked Allen and Unsoon Varner what, if anything, they know about the business there, including allegations by some patrons that the property was being used to host illegal gambling.

“I was scared to death,” said Unsoon Varner. “I said, ‘What’s going on?’”

“We don’t want something there where people go gambling or you start having problems with police,” said Allen Varner. “That’s when we think we needed to get ahold of a lawyer and start seeing if we can take action,” he said.

When asked who leased out the arcade space located on the Varner’s commercial property, the couple confirmed their tenant was Norman Fagafaga.

A public records search through the database Lexis-Nexis shows Norman Fagafaga to be a potential relative of Clayton Peters.

Fagafaga and Clayton Peters, formerly Clayton Nai, were two of three men arrested in connection with a 2006 shooting at an Anchorage football stadium, according to prior coverage by Alaska’s News Source and other media outlets. Both Fagafaga and Nai were later fully acquitted in that case.

While Alaska’s News Source is still seeking answers regarding these two businesses, the Varners’ attorney states he’s now in the process of trying to evict the Muldoon arcade tenant.

As for the West Side Arcade, four days after Alaska’s News Source aired its initial story in early March, the business license was renewed.

An investigator for the Alaska Division of Corporations confirms “a referral was made to the appropriate law enforcement agency for the criminal allegations,” later confirmed to be the Alaska State Troopers. Troopers would be responsible for determining whether any laws have been broken.

When contacted by Alaska’s News Source, neither the Anchorage Police Department nor Alaska State Troopers would verify whether any open criminal investigation exists.

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