Feds have found the man behind Denver’s Player One Arcade guilty of running an illegal gambling operation. [Image: Shutterstock.com]

Illegal gambling arcade

The United States Attorney’s Office for the District of Colorado (USAO-CO) has announced a guilty verdict for the owner of Player One Arcade in Denver who ran an illicit gambling enterprise.

A federal jury found Denver native Jonathan Arvay, 38, guilty on one count apiece of conspiracy to conduct an illegal gambling business, and conducting an illegal gambling business.

The USAO-DO took to X Tuesday with news of the two guilty charges Arvay will face at his scheduled December 12 sentencing:

According to the feds, Arvay’s Player One Arcade was one establishment in a gambling parlor chain spreading outwards from Denver to the cities of Greeley and Pueblo and taking in Colorado Springs, Lakewood, and Aurora. 

These establishments housed multiple electronic gambling machines “made to resemble arcade games,” and virtual slot machines, stated the DOJ press release.

E-currency for cash

According to the USAO-CO release, whatever winnings players made on the games would be converted to cryptocurrency, which could then be exchanged for cash.

Arvay’s trial notes reveal customers in Player One Arcade, or the other parlors, would exchange any credits won for cryptocurrency known as Obsidian Digital Asset Coin.

looked like ATMs but were instead crypto teller machines

Housed within the arcades, or next door to them, were what looked like ATMs but were instead crypto teller machines. Customers would then use the machines to convert their e-currency winnings into cash, for which they would pay a transfer fee.

USAO-CO’s Acting US Attorney Matt Kirsch stated on Tuesday that Arvay and other unnamed defendants ran “a large, complex” illegal gambling operation via online and brick-and-mortar channels.  

Kirsch said the gambling parlors “masqueraded as arcades with a veneer of legitimacy.” IRS Criminal Investigation Denver Field Office Acting Special Agent in Charge, Tom Demeo, meanwhile, praised those involved in the investigation for helping unravel Arvay’s “complex financial scheme.”

Demeo added that IRS special agents will counter fraudsters devising “new ways to evade their tax liability and defraud the government,” by adding novel investigative methods to trace the illegal funds and “hold these criminals accountable.”

Community concerns

FBI Denver Special Agent in Charge Mark Michalek said the money made by the illegal gambling parlors led to multiple violations besides money laundering and fraud. Michalek went on to thank all parties involved for successfully dismantling “the gambling dens that were negatively impacting surrounding communities.”

establishments were causing real harm in our communities.”

Attorney Kirsch was also grateful to officers of the law for “digging beneath the veneer and finding that these establishments were causing real harm in our communities.”