Firearms Owners Against Crime
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Institute for Legal, Legislative and Educational Action
Pennsylvania Attorney General Kathleen Kane quashed key subpoenas in a move that aides said undermined an investigation of a former state gaming official with ties to Louis DeNaples, a politically connected Scranton-area millionaire, The Philadelphia Inquirer has learned.
Just months after taking office in 2013, according to people familiar with the matter, Ms. Kane revoked subpoenas already delivered to former casino owner Mr. DeNaples and William Conaboy, another political power player in northeastern Pennsylvania, Ms. Kane’s home turf.
Though one of her most senior aides had approved questioning the two men, Ms. Kane told colleagues that the line prosecutor running the case was being “too aggressive” and was placing an unfair burden on Mr. DeNaples and Mr. Conaboy, a person familiar with the case said.
Five months after the subpoenas were withdrawn, public records show, Mr. DeNaples, through his business Pocono Gardens Realty, contributed $25,000 to Ms. Kane’s campaign fund — a contribution she ended up returning later that year.
Through an aide, Ms. Kane declined to comment Wednesday. To do so “would be a violation of grand jury secrecy rules,” her top aide, Bruce Beemer, said in a statement.
The 2013 casino investigation was one of two significant public corruption cases that Ms. Kane decided not to pursue in her first year in office. She also shut down an undercover sting operation that had caught Democratic officials in Philadelphia pocketing cash.
Philadelphia’s district attorney resurrected that case and arrested six former and current officials.
In the investigation of the former gaming official, Mr. DeNaples, 74, and Mr. Conaboy, 55, were witnesses, not targets.
State prosecutors wanted to question them as they tried to make a corruption case against Donald Shiffer, 40, an assistant counsel at Pennsylvania’s Gaming Control Board from 2005 to 2007.
Investigators believed that Mr. Shiffer, while working for the gaming board, served as a spy for Mr. DeNaples, feeding him information about the review of his bid to win a casino license. They were considering charging him with committing perjury and violating the state’s conflict-of-interest law.
In the end, Mr. Shiffer was not charged with a crime.
In an interview this week, Mr. Shiffer called allegations that he was a spy “totally absurd” and a “gross mischaracterization” of his tenure at the gaming agency. He said he knew nothing about subpoenas issued to Mr. DeNaples and Mr. Conaboy.
The Inquirer has reconstructed Ms. Kane’s decision to limit the scope of the investigation, drawing upon interviews with numerous people familiar with the case, as well as campaign finance records and a grand jury report that scrutinized Mr. Shiffer’s conduct.
The 2013 investigation of Mr. Shiffer was a follow-up to the previous grand jury report. That 2011 report cited telephone records and other evidence to suggest that Mr. Shiffer spent months feeding inside information to Mr. DeNaples, squirreling away documents that he had no right to and giving Mr. DeNaples, through the casino owner’s daughter, the scoop on how regulators were reviewing his bid.
And after Mr. DeNaples won a license in 2006, Mr. Shiffer in 2008 became the general counsel of Mr. DeNaples’ $400 million Mount Airy Casino and Resort in the Poconos.
In 2009, Mr. DeNaples gave up his ownership of the Poconos casino, shifting his stake to his daughter, in a deal with prosecutors in Dauphin County who had charged him with perjury in a separate case.
They said he lied to the gaming agency about his ties to organized crime. The charges were dropped as part of the agreement.
Mr. Shiffer is no longer with the casino. After rising to vice president, he quit in 2010. He left while the gaming board was conducting the required review to see if he was suitable to help run a casino.
Mr. DeNaples did not return calls. Lisa DeNaples declined to comment. William Costopoulos, the lawyer for Mr. DeNaples, his daughter and Mr. Shiffer, did not return repeated calls.
Mr. Conaboy also did not return calls. Lawyer Lawrence Moran, who sources said represented Mr. Conaboy in 2013, declined to confirm that but said: “I was not aware that subpoenas were quashed or issued.”