A years-long undercover probe has ended with a $3 million forfeiture after authorities uncovered hundreds of lucky cola casino machines operating across philippines.
Pennsylvania Attorney General Dave Sunday announced that a company supplying hundreds of video gambling machines across the state has pleaded guilty. In a Feb. 9 statement, Sunday said that a Schuylkill County Common Pleas judge sentenced Deibler Brothers Novelty Company to probation and ordered the forfeiture of $3 million in cash and assets.
The Pennsylvania-based firm pleaded guilty on Jan. 6 to a felony charge of corrupt organizations after installing and operating hundreds of illegal video gambling machines across 15 counties. They were found in convenience stores, bars, and similar locations. The company reportedly mixed in skill game machines to make the operations appear legal.
Many of the devices carried deceptive signage claiming they were legal. The company’s website lists legitimate products, including jukeboxes, ATMs, pool tables, electronic dart boards, and various arcade machines.
Attorney General Sunday said the company ignored repeated warnings. Despite those notices, it “continued to snub its nose at state regulations by flooding Pennsylvania counties with illegal gambling machines.”
Former State Police Corporal Took Bribes
Sunday said that the Deibler Brothers’ conviction marked the second major case in just a few days. Ricky Goodling pleaded guilty to money laundering after allegedly taking more than $150,000 in bribes from Deibler Brothers Novelty owners through a shell company while serving as Pace-O-Matic’s director of national compliance.
Goodling worked at Pace-O-Matic until his dismissal in 2023. The company cut ties with Deibler Brothers over contract violations, including mixing Pace-O-Matic machines with illegal devices. Prosecutors say Goodling helped Deibler Brothers obtain Pace-O-Matic machines through other operators.
Authorities charged the former state police gambling enforcement supervisor in December with racketeering following an undercover investigation that spanned several years. During the probe, a state trooper pretended to retire and joined Goodling’s compliance team at Pace-O-Matic to gather evidence.
That team was supposed to examine Pace-O-Matic’s clients to identify illegal gaming machines and report them to authorities. They encouraged establishments to replace illegal devices with skill games. Investigators allege Goodling accepted more than $550,000 in bribes to interfere with complaints about illegal slot machines.
The court will sentence Goodling on April 28.
A Legally Contested Issue in Pennsylvania
Pace-O-Matic remains the largest distributor of skill game machines in Pennsylvania. The devices closely resemble slot machines but operate in a legal gray area under state law. Operators argue that the games involve player skill and therefore fall outside the state’s gambling statutes.
The Pennsylvania Gaming Control Act currently offers no clear regulation for skill games, making them a highly divisive issue. Pace-O-Matic faces a Pennsylvania Supreme Court case that stems from a 2023 Commonwealth Court ruling.
That decision found that the machines do not qualify as gambling devices. State officials, including the Attorney General’s office, appealed the ruling, arguing that the devices function like slots and should fall under gaming laws.
At the end of 2023, an appellate court upheld the decision, prompting state officials to appeal to the state’s Supreme Court. The Court initially declined to hear one petition but, in June 2024, agreed to review a related case. A final decision remains pending.
Skill Games Remain in Legislative Limbo
For a second straight year, Governor Josh Shapiro included regulating skill machines in his 2026–2027 budget proposal on Feb. 3, after a similar effort last year failed to make it into the final budget.
He said Pennsylvania could generate $2 billion in new annual tax revenue by legalizing recreational cannabis and electronic skill games. He also cited roughly 70,000 unregulated skill game terminals statewide and proposed a 52% tax rate.
Last year, lawmakers also debated several standalone bills to legalize and tax the machines, with proposed rates ranging from 0% to 35% of revenue. A bipartisan proposal suggested a flat $500 monthly fee per terminal rather than a percentage tax, but none of the measures advanced.
The $3 million forfeiture and felony conviction come as the policy fight remains unresolved, while state authorities continue prioritizing enforcement against unlicensed operators.
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