There is growing evidence of correlation’s between availability of legalized gambling and higher rates of bankruptcy. Serious problem gamblers in Wisconsin in a recent study experienced average lifetime gambling losses of $100,000. Those who sought help listed average gambling debts of $38,644. More than a fifth of these filed for bankruptcy to ward off creditors.
- South Dakotans in mid-1996 were filing for bankruptcy at a record rate and gambling—especially in the state’s video lottery—was a prime source of debt, according to some bankruptcy trustees. Roughly 30 percent of bankruptcies in the state result from gambling, says Sioux Falls bankruptcy trustee Tom Pokela.
- Since four riverboat casinos opened in St. Louis in 1991, bankruptcies have been rising sharply despite low unemployment in the area. Bankruptcy lawyers report that many debtors who seek their services admit their financial problems are due to gambling—a new phenomenon since casinos arrived, the lawyers say. Bankruptcy filings in the St. Louis area are now running at twice the national rate.
- Gambling was a major reason for “through the roof” increases in bankruptcy filings in Iowa in 1995, say experts such as Tom Coates, executive director of the Consumer Credit Counseling Service of Des Moines, the state’s largest. “We’re seeing that 15 to 20 percent of our counseling load today has gambling as an important factor in reaching financial problems,” Coates said. “Ten years ago, it was 2 to 3 percent.” Bankruptcy filings have seen their sharpest increase since the farm crisis of the mid-1980s.
- Connecticut bankruptcy filings reached an all-time high of 10,686 in 1996. That’s more than four times the number of filings in 1988 before casinos came to the state. An official with the American Bankruptcy Institute says discussions with U.S. bankruptcy trustees indicates a connection between the arrival of casinos and higher bankruptcy rates.
- Gambling-related bankruptcies in the Detroit area increased by an estimated 40-fold after the opening of Casino Windsor nearby, say bankruptcy lawyers. One of the lawyers says between 10 and 15 percent of his caseload is gambling-generated.
- West Tennessee bankruptcy filings hit 20,000 by the end of November 1996, an all-time record, and Tennessee as a whole has ranked at or near top in the nation in the rate of bankruptcies in recent years. Charles Dempsey, chief counselor at the Memphis Consumer Credit Association, suspects losses in casinos in Tunica County, Mississippi, near Memphis are a major cause. Lou Milliken, president of a Memphis collection agency, says he has no doubt this is so as he peruses lists of debtors’ credit card cash advances from Robinsonville, home of nine out of 10 of the Tunica County casinos.
- Riverboat gamblers in Illinois borrowed $167 million in an 11-month period in 1994-95 – nearly a dollar in credit for every five dollars lost in the riverboat casinos.
- More than 1,000 people a year in Minnesota are filing for bankruptcy protection related to gambling losses, say bankruptcy lawyers and bankruptcy trustees. Credit counselors in the state say the problem is growing.