Feds: $2.5M seized from Michigan gambler’s luggage was scam proceeds

By Tresa Baldas, Detroit Free Press (TNS)

Published Thursday, Dec. 29, 2016 | 1:34 p.m.

Updated Thursday, Dec. 29, 2016 | 3:58 p.m.

At the casino tables, he looked like a rock star -- a high-stakes roller who cashed out nearly million-dollar winnings.

He flew first class, courtesy of the casinos, and racked up six-figure gambling debts in Las Vegas and Atlantic City, court records show.

But it didn't last.

In a sensational case that's unfolding in U.S. District Court in Detroit, the federal government says it has uncovered a scheme involving a professional gambler from Southfield and two cohorts who allegedly scammed investors out of hundreds of thousands of dollars to bankroll gambling sprees in Las Vegas. Prosecutors say 50-year-old Brian Benderoff of Southfield and his two unnamed associates pulled off this scheme until they arrived at Detroit Metro Airport in June with more than $2.5 million in their luggage -- most of it cash.

The federal government alleges the loot was obtained illegally.

Related stories:

No criminal charges have been filed in the case, which surfaced in a Dec. 23 civil forfeiture filing that details the federal government's request to keep what it seized at the airport that day: a silver Rolex watch; nearly $1.6 million in cash; a Caesars Palace check for $850,000, and a $150,000 cashier's check from Chase Bank.

Benderoff could not be reached for comment. His mother, who did not disclose her name, spoke to the Free Press in a brief phone conversation today.

"I don't know anything about it," the Oakland County woman said of her son's legal issues. "I don't see him all the time. ... I'm going to find out what's going on."

About an hour after that conversation, the Free Press received a phone call from one of Benderoff"s lawyers: top-shelf local attorney Gerald (Gerry) Gleeson, who along with the prominent lawyer Thomas Cranmer, is representing Benderoff.

"We're looking forward to sorting it out in the next couple of months," Gleeson said, declining further comment.

The U.S. Attorney's office declined comment on whether criminal charges would be filed in the case.

According to court documents and public records, Benderoff 's past includes a 2001 bankruptcy filing, several lawsuits in Oakland County and a federal lawsuit in New Jersey, where an Atlantic City travel agent said he pretended to be a high roller with money that wasn't his.

According to that 2008 lawsuit, Benderoff allegedly conned a travel agent out of more than $600,000 in loans -- promising to pay it back, but instead gambling it all away. According to the lawsuit, Benderoff had high-roller status at Bally's Park Place, Caesars and Tropicana -- all of which bought him first-class airline tickets through a travel agency that operated out of Caesars Hotel and Casino. Given Benderoff's status, the travel agent agreed to cash Benderoff's personal checks when he showed up at the office looking for money to cover his gambling losses.

According to the lawsuit, Benderoff wrote the travel agent four checks totaling almost $300,000. In return, the agent gave Benderoff American Express travelers checks.

But all of Benderoff's checks bounced, the lawsuit said. Benderoff vowed to pay him back, claiming he had a business deal in the works that could make that happen, the lawsuit said. The travel agent gave him another $330,000 to help Benderoff seal that so-called business deal, but it never happened.

"In reality, there was no business deal, and Benderoff lost all of the money gambling," the lawsuit claims.

The civil suit was eventually dismissed because -- as the federal judge wrote in his order -- a state indictment had been returned in the case and a civil suit could unduly prejudice the criminal case. In 2010, Benderoff was sentenced to 18 months probation and ordered to pay $299,500 in restitution by a New Jersey judge.

Six years later, Benderoff's gambling habit would catch up with him again, this time in Detroit.

According to the civil forfeiture complaint filed on Dec. 23, here is what landed Benderoff on the federal government's radar:

On June 23, during the security process at the McCarran Airport in Las Vegas, TSA agents spotted a large amount of cash inside the carry-on luggage of a man who was traveling with Benderoff. The pair were headed to Detroit, where two federal agents were waiting for them at the arrival gate. Upon arrival, federal agents escorted the two men to the luggage carousel rack, where the agents retrieved six luggage bags that belonged to Benderoff and his associate.

The two men consented to have their carry-on bags and checked luggage searched, the court filing states. Agents searched the luggage and found:

• $886,372 in cash in Benderoff's luggage.

• An $850,000 cashier's check drawn from Benderoff's account at Caesars Palace Casino in Las Vegas.

• A $150,000 cashier's check in Benderoff's luggage.

• $699,000 in cash in the unnamed associate's luggage.

"Benderoff told agents that a majority of these funds were the 'cashed out' proceeds of recent gambling activity in Las Vegas," the court filing states.

Benderoff said that he had been in Las Vegas for several weeks with his unnamed traveling associate and another individual, and indicated "that he is a professional gambler," the filing states.

But the federal agents would learn more from the unnamed associates, who, according to court records, revealed what was going on: They were convincing unwitting investors to give them money for bogus business deals that ended up paying for gambling, instead, the filing states.

For example, according to court documents:

* One investor gave $125,000 to Benderoff and a cohort, thinking the money would help pay off liens on business equipment.

* Another investor gave the same men $125,000, thinking the money would be used for investment in a medical marijuana business.

* A third investor was allegedly duped into believing his $200,000 would be used for a life insurance-related investment.

Instead, federal prosecutors allege, this money was wired into a joint bank account controlled by Benderoff and one of his associates, and then spent at the casinos.

"Interviews with multiple investors who provided funds to Benderoff and individual 2 revealed that the vast majority of those investors had not been told their funds would be used for gambling purposes, when, in fact, they were used for such purposes," Assistant U.S. Attorney Philip Ross wrote in the court filing.

The filing does not indicate who owned the Rolex watch.