Ex-Mayor's Legacy Ruined By Gambling Addiction

By Adrian Duyzer
Published February 15, 2013

Maureen O'Connor, former mayor of San Diego, spent over a billion dollars in casinos over the last decade, including $2 million that belonged to a charity created by her late husband. According to the New York Times:

A former mayor of San Diego spent the last decade wagering more than a billion dollars at casinos across the country, eventually liquidating her savings, auctioning her belongings, selling off real estate, borrowing from friends and taking more than $2 million from a charity set up by her late husband, a fast-food tycoon.

The former mayor, Maureen O’Connor, 66, blamed an addiction to gambling aggravated by a brain tumor for the gargantuan spree. Her lawyers said that while she had made well over a billion dollars in bets at casinos in Las Vegas, Atlantic City and San Diego, her actual net losses were around $13 million.

Federal prosecutors said it was impossible to know precisely how much Ms. O'Connor had lost over those years, but she emerged with her fortune gone and her health shattered. She took out second and third mortgages on her La Jolla, Calif., home to pay for the gambling.

Ms. O'Connor is by no means the only high-profile individual whose fortunes have been ruined by gambling. In 2007, businessman Terry Watanbe lost nearly $127 million in Las Vegas, miring him in personal debt and criminal charges for unpaid gambling debts.

Locally, Gabe Macaluso, who was the CEO of HECFI and ran Hamilton Place, the Hamilton Convention Centre, and Copps Coliseum, lost over $500,000 - and his job - after a series of losses at Casino Niagara:

A lawsuit says former Copps Coliseum boss Gabe Macaluso led a double life as a business executive on the one hand and a compulsive gambler at Casino Niagara, above, on the other.

A high-profile Hamilton official who lost his job to a gambling addiction is suing the Ontario government and Casino Niagara for allegedly sending a limousine to take him back to the blackjack tables following a $500,000 loss.

Gabe Macaluso, former chief executive of Copps Coliseum, Hamilton Place and the Hamilton Convention Centre, lost $1-million over five years while he suffered what he calls a "secret, pathological" addiction to gambling.

Mr. Macaluso joins a small but growing number of recovered gambling addicts in Ontario and Quebec who have filed lawsuits demanding government-run casinos stop them from ruining their lives.

Mr. Macaluso filed the $3-million lawsuit at Hamilton's Superior Court last week, naming the Ontario Lottery and Gaming Corp., which oversees the province's $2-billion gambling industry and Falls Management, the company that runs Casino Niagara. The allegations remain to be proven in court.

As head of Hamilton's city-owned entertainment complexes, Mr. Macaluso dined with celebrities such as Celine Dion, Elton John, Shania Twain and Bono from U2. He earned a six-figure salary, had the use of a company car and regularly jetted off to meetings in Milan, Hong Kong and Paris. An active community member, he was elected a trustee for the Catholic school board and attempted a run at provincial office.

"I had it all," he said. "It all came crashing down on me."

Macaluso eventually became suicidal, but was fortunately saved by the intervention of a close friend, Peter Mercanti:

A lifelong friend, Peter Mercanti, intervened, dragging Mr. Macaluso away from the casino and sitting him down at a diner in the middle of the night to talk him out of killing himself.

His friend outlined a plan for Mr. Macaluso to consolidate his debts under bankruptcy protection and enter treatment.

He immediately enrolled in a 10-day outpatient program at a private clinic and started attending Gamblers Anonymous meetings.

In an interesting twist, Peter Mercanti's company, Carmen's Inc., just won the bid to manage the Hamilton Convention Centre, and with his son PJ Mercanti and other partners is seeking to open a casino in downtown Hamilton.

Adrian Duyzer is an entrepreneur, business owner, and Associate Editor of Raise the Hammer. He lives in downtown Hamilton with his family. On Twitter: adriandz


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By Karl (anonymous) | Posted February 15, 2013 at 10:22:17

Adrian, thank you for writing this. Dr. Nick Bontis is being dangerous when he publicly states that the world will tell a sad story about the poor losing their last loonie and then going on to say that the average income of a gambler is $90,000.

By using this sales tactic, Bontis is attempting to trivialize the health impacts of gambling.

Mental illness does not discriminate. The impact of addiction/problem gambling is just as real for rich and poor alike.

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By Conrad664 (registered) | Posted February 15, 2013 at 10:46:10 in reply to Comment 86352

Thats wright , its real for poor and the rich alike lets not forget that ... its not only the poor Hamilton there is over 200,000,OOO dollars going OUT OF THIS CITY EVERRY YEAR for the last decades at list

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By Noted (anonymous) | Posted February 15, 2013 at 11:19:47

August 2006:

Gabe Macaluso, manager of operations for Cirque Niagara and president of CEG Entertainment Group... said Cirque Niagara came together after 20 Beslan survivors visited Niagara Falls last year. Partners of the spectacular show met the Kantemirov family while the survivors enjoyed their stay. The family is renowned for its circus performances, helping build Cirque Du Soleil. Kantemirov's uncle Mairbek helped create Cirque Niagara Avaia.

October 2007:

Hamilton businessman Peter Mercanti was instrumental in bringing Niagara Falls its own Cirque du Soleil-style show. He flew in the entire production, from props to the horse ring to the actual performers, from Russia.

Mercanti, owner of Carmen's Banquet and Entertainment Centre, is also a major investor. His partners in the venture were Tony Battaglia and Gabe Macaluso.

Battaglia, chairperson of Tradeport International Corporation -- which operates Hamilton's airport -- helped attract 28 other investors, including Michael Burgess, who performed in Phantom of the Opera and Les Miserables.

"It was a spectacular show. We were just in the wrong market," said Macaluso, the company's vice-president of tour development yesterday.

December 2011:

With ties to Russia's famed Kantemirov circus family, Cirque Niagara was a visually stacked show mixing acrobats and rare Russian horses. Operating out of a $1.3 million tent set up at Rapidsview Park, across from Marineland, it sold about 170,000 tickets its first season.

The following year, performers arrived in Canada early to perform the show in April at Toronto's Woodbine Racetrack, but because they only had temporary visas, they were unable to stay for the full duration of the summer in Niagara Falls. Offering the same show as the previous year, Avaia, may have also been a factor in declining ticket sales. The company closed two weeks early.

"We've got a lot of overhead, and revenues were not what we expected this year," said Jana Ray, the company's director of sales and marketing at the time.

A few weeks later, the company filed for bankruptcy, citing assets of $490,000 and liabilities of $6.7 million.

Among the creditors was Gabe Macaluso, the former head of Hamilton's Copps Coliseum who in 2007 received an out-of-court settlement from the Ontario Lottery and Gaming Corp. for a lawsuit in which he claimed he was allowed back into Casino Niagara despite a heavy gambling addiction.

His claim for Cirque Niagara losses was $191,136. Hamilton-based insurance brokers John Mitchell and Wayne Abbott had a claim for nearly $650,000, while the Niagara Parks Commission - with whom Cirque Niagara entered into a 10-year agreement for use of Rapidsview Park - had a claim of $416,046.

Former Cirque Niagara president and CEO Peter Mercanti did not return messages left by The Review. Mercanti operates the popular Carmen's Banquet Centre in Hamilton with his two sons.

Even in 2006, Mercanti said the show needed a permanent home, not a tent on rented property: "We love the location, but we want to be down to where the Falls fall."

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By and our own ex-guy (anonymous) | Posted February 15, 2013 at 12:55:39

Um, and one of our defeated frequently ex-mayors writes in the Spec about how much fun gambling is.

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By Robert D (anonymous) | Posted February 15, 2013 at 14:23:14 in reply to Comment 86361

Oh the Spec....for "not having a position" they sure seem keen on talking about a downtown casino, and talking about how Flamborough won't work...

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By HamiltonBoy (registered) | Posted February 15, 2013 at 15:53:26

I am well aware of the strong bond between Peter Mercanti and Gabe Macaluso. I've seen it first hand. So, I would love to ask Peter if he would consider banning Gabe from his proposed Hamilton Casino?

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By Pxtl (registered) - website | Posted February 15, 2013 at 19:48:37

What bugs me is that, in Ontario, gambling is partially run by the Ontario government.

The Ontario government knows how much you earn. We have income tax here. It knows how much you gamble, because they have a monopoly on the industry. They could trivially set up an automated system that makes sure you don't gamble more than you can afford.

They already control access to the casinos for voluntary withdrawal. They already keep track of how much everyone wins and loses. They already know our income because it's the provincial government. None of the sensitive data has to leave the government... the CRA could easily just run a web-service that takes a person's driver's license number, provincial ID, or SIN and checks it against their income and their gambling-losses-to-date and says "no, you are no longer permitted to gamble until the next tax-year, you've hit your allotted rock-bottom". I know I'm not the only programmer with enough hubris to think "yeah, I could pull that off and it wouldn't even be that hard".

Well, in theory. In practice it would somehow become a boondoggle like the long-gun registry. But either way, you get my point - they have all the necessary information at their finger-tips and they have access to the point-of-service for gambling. They're everywhere they need to be to develop a loss-cap on gambling in-house.

But they do not. Because they don't really want to stop Ontarians from flushing all their savings down the drain.

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By Le Chiffre (anonymous) | Posted February 15, 2013 at 20:40:07 in reply to Comment 86381

One step closer to Miniluv!

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By Mogadon Megalodon (anonymous) | Posted February 16, 2013 at 09:25:27 in reply to Comment 86384

Not entirely. The system's nepotistic/incestuous tendering processes (which favour contractors with public sector experience) don't improve the outcome, either.

"Although we acknowledge that the highly technical nature of the EHR initiative necessitates some degree of specialist consulting advice, the fact that the development of an EHR had been on the government’s agenda as far back as the early 2000s caused us to question the heavy, and in some cases almost total, reliance on consultants. This reliance continued to increase over time. This was particularly the case at the Ministry, which in 2007 consolidated all of its eHealth projects into an eHealth Program Branch. By 2008, the Branch was engaging more than 300 consultants compared to fewer than 30 full-time ministry employees—even a number of senior management positions were held by consultants. Consultants were not only managing other consultants but also at times had the authority to hire more consultants, sometimes from their own firm."


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