Under the terms of the settlement agreement released Wednesday, East Main Investments LLC admitted “without exception, limitation or condition” that practices inside the Silver Dollar Bar violated charitable gambling rules. The agreement also requires the investment group to pay an undisclosed amount in attorney fees associated with the investigation and enforcement action in place of a fine, according to a statement from North Dakota Attorney General Drew Wrigley’s office.

East Main Investment is the local group that owns the Silver Dollar Bar on Main Street. The group is composed of Jason Arenz, Wade Meschke and Lyle Carr. Arenz and Carr are also employed at BNC Bank, while Meschke is employed by Mandan Public Schools, according to the settlement agreement. Mesche also is president of the Mandan Park Board. 

EMI received a notice of violation on July 3 and was handed a one-year suspension effective that same date, according to the settlement agreement. However, the final six months of the suspension will be delayed for three years, as long as no other gambling rule violations are alleged during that time. If further violations occur, the agreement stated, all gambling authorizations will be immediately revoked. 

Under the terms of the agreement, charitable gambling at the Silver Dollar Bar could resume as soon as Jan. 1, provided the city of Mandan approves a site authorization for a licensed gambling organization, according to Attorney General spokesperson Suzie Weigel. Weigel also said Wednesday’s announcement is significant because EMI “fully admitted” to the violations of gambling laws and administrative rules.

“These violations again demonstrate that some unscrupulous individuals and entities involved in charitable gambling are ignoring the charitable purposes and resorting to unlawful practices and greed,” Wrigley said. “My office will ensure we enforce North Dakota law and protect the integrity of the charitable gambling industry.” 

The bar was closed when the group purchased the property in late 2022 and reopened in August 2023 after several months of renovation.

The reopening included a gambling site designation authorization granted by the city of Mandan in July 2023. That authorization permitted EMI to conduct gambling in conjunction with Dakota Leathernecks Detachment No. 1419, according to the settlement agreement. A gambling site authorization was then granted by the Attorney General’s Office in September 2023, the agreement indicated.

“Leathernecks” is a slang term often used to refer to members of the U.S. Marine Corps. The Dakota Leathernecks are a chapter of the U.S. Marine Corps League, a congressionally chartered veterans organization. According to the local chapter’s Facebook page, the Dakota Leathernecks is a nonprofit organization that “bands together active duty, reserve and honorably discharged Marines & FMF (Fleet Marine Force) Corpsmen and good citizens who support the USMC.”

Information from the Secretary of State’s Office indicates Dakota Leathernecks Detachment No. 1419 is registered in good standing as a nonprofit corporation.

Stephanie Belohlavek-Geiger, commandant of the Dakota Leathernecks chapter, told the Tribune the charitable gambling at the Silver Dollar Bar was the organization’s first foray and that the group “learned a lot.” When she was asked if the group would resume its gambling at the bar should the opportunity arise, she said, “I think we would. I thought we had a good relationship.”

State law allows groups like the Dakota Leathernecks to conduct charitable gambling in bars. Typically those nonprofits have a rental agreement with bar owners and under North Dakota’s administrative code, bar owners are prohibited from operating any gambling as a direct part of their business. Additionally, bar owners are barred from pressuring charities to pick specific games or interfering with prize decisions or how proceeds are distributed.

According to the settlement agreement, those conditions were made plain to Arenz when he and his attorneys met with members of the State Gambling Commission and the Attorney General’s Office prior to the state gambling authorization being approved. He also reportedly signed paperwork on behalf of EMI acknowledging those rules. 

EMI or its representatives allegedly required Dakota Leathernecks to offer blackjack, while a portion of gambling proceeds were required to be directed toward the bar’s participation fees in recreational softball and darts leagues, the document stated. The settlement further indicated those requirements were conditions of the rental agreement between the nonprofit and the bar.

It wasn’t immediately known how state gambling officials or the Attorney General’s Office were notified. Messages from the Tribune to EMI’s attorneys regarding the settlement or potential resumption of charitable gambling in the Silver Dollar Bar were not returned.

Gambling Division Director Deb McDaniels said violations such as the ones committed by EMI or its representatives “undermine the charitable gambling industry as a whole.”

“The violations that occurred in this instance have long-term impacts on nonprofit organizations that honestly follow the law,” McDaniels said. “The gambling Division takes these violations seriously and will continue to investigate and take appropriate action against other sites that want to make this a ‘for profit’ industry; that undermine the good work of charities.”