Tuesday, Sept. 11, 2001 | 9:42 a.m.
Bob was on top of the world nearly three years ago.
The 56-year-old local advertising manager had just purchased a home with cash after winning a $257,000 progressive jackpot at Arizona Charlie's, a locals' casino in Las Vegas.
Next, Bob jetted off to the East Coast to visit family on no timetable because he had just quit his job, figuring he would take some indefinite time off.
That lasted a year as his fortune, habits and lifestyle took a 180-degree turn.
He began to spend more and more time in front of slot machines, trying to recapture that adrenaline rush he felt when he won the jackpot.
"It started as a way to fill the void of boredom and loneliness," Bob recalled recently.
Yanking on the slots became his obsession, said the recovering compulsive gambler. Bob is now consulting with a personal bankruptcy lawyer. The Las Vegas Sun agreed not to publish his last name.
"For two years I'd been considering getting help, but never had the (courage) to do it," Bob said. "(My gambling problem) was devastating me, but at the same time, I was having too much fun."
Bob said he hasn't gambled in four weeks. He's back working as an advertising manager earning roughly $50,000 a year, but owes the IRS $65,000 in back taxes and has accumulated other debts as well.
That's why he said he's filing for bankruptcy.
"I didn't consider bankruptcy until the subject came up during the first week of (a gambler's treatment) clinic, and I figured I probably should do it," Bob said.
On a recent Thursday night at the Problem Gambling Center, a directed intensive "boot camp" version of gambler's anonymous in Las Vegas, five of the 13 members there said they had filed for bankruptcy at least once because of a gambling problem.
"A gambling problem and bankruptcy are like baseball and hot dogs," said James Houston, 36, a compulsive gambler and regular at the Problem Gambling Center.
Houston filed for bankruptcy after 18 months of juggling gambling debts on four credit cards. The Henderson manufacturing plant worker, who earns an annual income of $22,000, had accumulated $30,000 in gambling debts before filing for bankruptcy.
During his gambling binges, which he said began nearly two years ago at the Riviera hotel-casino, Houston would make minimum monthly payments when he hit a brief hot streak or he would obtain a cash advance from one of the credit cards.
The Riviera declined to say if it was familiar with Houston's trips to its property.
"It's company policy not to comment on any of our customers," Riviera spokesman George Staresinic said.
When asked if the Riviera has any programs in place to curb compulsive gambling, Staresinic said signs promoting problem gambling help programs are posted throughout the casino area of the property.
Problem gambling, like that experienced by Bob and Houston may cause up to 14.2 percent of the annual bankruptcy filings in the United States, said a recent study by SMR Research Corp. of Hackettstown, N.J.
In a separate Las Vegas study conducted during the first six months of this year, 11 percent of 150 clients of Consumer Credit Counseling Services attributed some portion of their financial problems to gambling habits.
"It could be a lot higher," said Michele Johnson, the Las Vegas counseling services chief executive. "They don't always tell the truth."
Johnson's study only took a small sample of the service's clients. She said her service counsels 800 to 1,000 families a month on how to manage their finances.
Doctors and UNLV sociology professors who work at the Problem Gambling Center say there has been very little research on links between Nevada bankruptcies and problem gambling.
George Yacik, vice president of SMR Research, said his study focused very little on Nevada because of its long history with gambling, and the difficulty of drawing comparisons between Nevada communities that have casinos and those that don't.
"Casinos are everywhere in Nevada," he said. "Historically, Nevada has had one of the highest bankruptcy rates in the country."
SMR Research produced the 241-page report, which costs $1,975, so it could sell it to its clients in the lending industry, Yacik said.
In 2000, Nevada ranked fourth among the 50 states in bankruptcy rates, behind Tennessee, Utah, and Georgia. In 1996, Nevada also ranked fourth behind the same three states, SMR Research's first bankruptcy study said.
SMR's 12-month study found that the 244 U.S. counties that have casinos had a bankruptcy filing rate that was 13.5 percent higher than the 2,865 counties that didn't have casinos in 2000.
"There is a connection between problem gambling and the increase in bankruptcy filing rates," said Ed Looney, executive director of the Council of Compulsive Gambling of New Jersey.
Atlantic County, N.J., which has 12 casinos, all of which are in Atlantic City, had a bankruptcy filing rate double that of the state's average.
Atlantic County's bankruptcy filing rate went from 5.28 per 1,000 adults in 1994 to 11.68 per 1,000 adults in 2000. The state's average, excluding Atlantic County, rose from 3.83 in 1994 to 5.99 in 2000.
Yet, it is nearly impossible to determine how many bankruptcies were directly related to gambling problems, Yacik said.
That's because not everybody who files for bankruptcy is required to say what led to their financial problems, Yacik said.
And those who do say why they filed during the interview process with a bankruptcy trustee often lie, said Bo Bernhard, director of operations for the Problem Gambling Center.
"Compulsive gamblers are liars," recovering gambler Bob admits. "I became the most deceitful bastard around and I have a Christian background."
Fred Preston, professor of sociology at the University of Nevada, Las Vegas, said the gambling atmosphere in towns like Las Vegas feed the frenzy.
"You have people moving here or retiring here because they enjoy the gambling atmosphere, and so you have a lot of people who have a higher possibility of developing a gambling problem," said Preston, who also works at the Problem Gambling Center.
In 2000, 6,646 Southern Nevadans filed to liquidate their assets through Chapter 7 bankruptcy, and 3,158 tried to reorganize their debts through Chapter 13 bankruptcy.
At the current rate, this year's figures will beat those in 2000. Through July 31, 7,834 people had filed for personal bankruptcy (Chapter 7 and 13) in Southern Nevada.
Checking bankruptcy applications for lists of creditors doesn't always show links to a gambling problem, even when they are related. That's because companies like MasterCard and Visa appear far more frequently than casinos as creditors, experts say.
Other reasons cited for the nation's rise in bankruptcy rates discussed in Yacik's report include the nation's rising divorce rate, a large number of Americans that don't carry medical or car insurance and personal debt rising faster than personal income.
Some also say the rise in bankruptcies is related to aggressive marketing by bankruptcy lawyers that point out that legislative efforts are under way to make it more difficult for Americans to clear their debt through bankruptcy in the future. These lawyers are urging clients to file for bankruptcy before the law passes.
This Congressional bill, which is largely being pushed by the credit card industry, would require debtors to undergo credit counseling before filing for bankruptcy.
Frank Fahrenkopf, chief executive of the American Gaming Association, said the SMR Research study is misleading, noting that other variables -- such as aggressive soliciting by credit card companies and liberalized bankruptcy laws -- assist in the rise of bankruptcy rates.
Fahrenkopf acknowledged that communities with casinos often do have higher bankruptcy rates. He believes that's because those communities attract people trying to get a fresh start.
Those efforts don't always work out, leading to personal bankruptcy, Fahrenkopf said.
"That doesn't mean they filed for bankruptcy because there are casinos in the community," he said.
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