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With Andy Sanborn under criminal indictment and his business for sale, the former lawmaker and casino owner is asking a judge to grant him a crime waiver.

Sanborn’s legal team filed a new lawsuit against the state seeking a waiver for his business, not to get out of the criminal charges, but to keep the hope of any sale alive. Sanborn essentially wants a written promise that whoever buys his Win Win Win LLC won’t be held liable for the pending criminal charges.

“In order for the sale of WWW to proceed, Plaintiffs require relief in the form of declaratory judgment that NHLC and OAG cannot hold WWW’s buyer responsible for alleged conduct predating the acquisition,” Sanborn’s attorney Mark Knights wrote.

Sanborn and Win Win Win were both indicted last month on charges of allegedly stealing COVID relief money from the state by submitting false information to inflate revenue.

State law allows for a corporation to be criminally indicted for the actions of its directors or employees. Sanborn owns Win Win Win, the company that holds the gaming license for his Concord Casino. While Sanborn faces prison time for his charges if convicted, Win Win Win could face significant fines and other serious sanctions. 

Even the possibility of crippling fines and sanctions will drive off potential buyers, according to Knights, which makes the New Hampshire Attorney General’s decision to indict the Win Win Win corporation notable. The state is already forcing Sanborn to sell his business because of a different alleged COVID relief scam, and the indictments were handed up as Sanborn had a potential buyer going through the New Hampshire Lottery Commission license vetting process, according to the lawsuit.

That buyer, it turns out, was denied a gaming license during the suitability review process, though Sanborn’s lawyers have said the denial is based on a correctable error, and not anything negative in the buyer’s background. The buyer has not been identified.

All of this could be moot given that Sanborn has already missed the deadline to sell his casino business. In December, Sanborn’s gaming license was suspended, and he was given six months to sell Win Win Win. The gaining license is to be revoked completely if Sanborn misses that deadline, which would make Win Win Win virtually worthless.

Sanborn is seeking more time for the sale in order to get the potential buyer’s suitability issues corrected, and Hearings Officer Albert Gregory is currently considering legal issues surrounding that request. 

Sanborn’s troubles started last year after an audit found problems with the way the business was using COVID relief funds. Attorney General John Formella issued a statement declaring Sanborn unsuitable to hold a gaming license and accused him of improperly getting $844,000 in federal COVID funds. Sanborn reportedly used that money to pay himself through a different LLC, called The Best Revenge, and to buy sports cars for himself and his wife, Rep. Laurie Sanborn (R-Bedford.)

Last December, Hearing Officer Michael King ruled Sanborn engaged in conduct that “undermines the public confidence in charitable gaming” and that he had to sell the business or lose the license. King’s ruling gave Sanborn six months to sell with the option of one, three-month extension of a sale was pending. 

Embattled and indicted Concord Casino owner Andy Sanborn is learning the hard way that the house always wins.

Under a state order to sell his business before his gaming license is revoked, Sanborn’s lawyers claim the state has rejected his proposed buyer without good reason. This revelation came Friday as attorneys for Sanborn and the state tried to talk around the buyer’s rejection during an administrative law hearing before Hearing Officer Gregory Albert.

Any individual who buys Sanborn’s casino will need to pass a suitability determination process conducted by the state. Because the results of suitability determinations are not public, in order to protect the reputation of rejected buyers, neither side was able to say directly that the buyer was rejected. However, the rejection was obvious based on the context of the discussion.

Adam Katz, one of Sanborn’s lawyers, said the state is manipulating the case to prevent Sanborn from selling the business, has scared off multiple potential buyers, and has now rejected a qualified buyer based on errors.“The buyer is still trying to engage with the state on why their [suitability determination] letter is nonsense,” Katz said.

Assistant Attorney General Jessica King objected to any discussion that could reveal the result of the suitability determination, but acknowledged under questioning her office told the buyer there is no way to appeal the determination.

“There is no clear mechanism to appeal suitability in the law,” King said.

The buyer has no blemishes on his record and is someone no one could object to buying the casino. He was stopped from divulging the reason for the denial by King. King rejected Katz’s arguments that the state is interfering with the sale, telling Albert the Lottery Commission met with the buyer several times to go over the suitability determination process.

“This narrative the state is trying to obstruct and prevent this sale is false,” King said. “There is no evidence the state is actually trying to prevent anything.”

Last year, Administrative Hearing Officer Michael King ordered Sanborn to sell his business within six months after determining that the former Republican State senator obtained more than $800,000 in federal COVID relief funding he was not entitled to. Sanborn then used the money on improper purchases, such as prepaying his rent and buying sports cars. 

Sanborn was indicted last month on state theft charges for allegedly inflating his revenue in order to qualify for state COVID funds, getting about $140,000 more than he was entitled to get.

Since the sale order was issued, Sanborn has been trying and failing to sell the business. He obtained an extension from Albert, who took over the administrative law end of the case this year after Michael King retired. 

“[Sanborn] has been trying to sell and walk away for months. He wants to put this mess far in the rearview mirror,” Katz said.

Albert’s last extension, issued in September, allowed Sanborn 15 days to sell the business once the buyer had passed through the suitability process. Now that 15 days have passed since the buyer was rejected, the state says Snbiorn must lose his gaming license. The state also argues Albert overstepped his legal authority issuing the 15-day grace period.

Katz told Albert he does have the authority to issue an extension, since it allows Sanborn to comply with the original order to sell. Katz blamed the state for interfering with the sale and working against the original sale order.

“The point of [the original] order is to complete a sale quickly,” Katz said. “Mr. Sanborn clearly has worked to sell. The only problem is the chicanery from the state.”

Andy Sanborn drew another bad card and may have lost his stake.

Arrested last week for alleged COVID fraud, the former state senator and his casino business are now indicted on felony charges for stealing from the state. 

The indictments handed up by the grand jury this week are related to Sanborn’s alleged fake numbers in his application for the Main Street Relief Fund grants. According to the indictments, Sanborn allegedly inflated the receipts for his casino by more than $1 million, netting about $188,000 in grant funds he was not entitled to.

Sanborn’s Concord Casino is technically owned by Sanborn’s Win Win Win LLC. According to the indictments, Sanborn’s June 2020 application for the grant funds inflated the business receipts and wrongly claimed that Win Win Win had been in operation for at least a year.

Sanborn, as an individual, is indicted on one felony count of theft by deception, and his LLC is charged with one count of theft by deception and theft by unauthorized taking. The charges against Win Win Win, which holds his gaming license, could end his bid to sell the casino business.

Sanborn is under state order to sell the Concord Casino as the result of another fraud accusation. He allegedly applied for federal COVID relief funds to which he was not entitled, and then misspent the $844,000 on things like sports cars and car equipment. He also allegedly used his various LLCs to prepay himself about 20 years’ worth of rent.

Sanborn is due in court next week for an arraignment on the charges. 

Andy Sanborn’s luck avoiding criminal charges crapped out Wednesday when the casino owner was arrested on one count of theft by deception for allegedly lying on a COVID relief application.

It’s the first criminal charge against the former Republican state senator since he came under scrutiny from state investigators last year. And the state may be ready to double down.

Michael Garrity, communications director for the New Hampshire Department of Justice, said Wednesday the investigation into Sanborn and his Concord Casino is active and ongoing.

More than a year ago, New Hampshire Attorney General John Formella announced the investigation into Sanborn and his wife, state Rep. Laurie Sanborn (R-Bedford), after irregularities were found during a state audit of the casino. At the time, Formella accused Sanborn of accepting $844,000 in federal COVID funds and then spending the cash on sports cars and other inappropriate items. Sanborn allegedly prepaid himself hundreds of thousands of dollars in rent for the business with the COVID cash.

Thursday’s charge alleges a different COVID scam. According to a Department of Justice statement, Sanborn lied on his application for a state Main Street Relief Fund grant. Sanborn allegedly inflated his casino revenue by $1 million. That bluff paid off when the grant came in, and Sanborn got $188,474 more in grants than he was entitled to, according to the statement. 

In December, Sanborn was ordered to sell the Concord Casino after Administrative Law Judge Michael King ruled he had engaged in COVID fraud. Sanborn’s “Win Win Win LLC” gaming license was suspended, and he was given a 6-month deadline to sell the business.

Since then, Sanborn has requested multiple deadline extensions and is currently using an extension to give a potential casino buyer more time to undergo a state review of his suitability. Administrative Law Judge Gregory Albert issued the extension.

Last week, lawyers with the Attorney General’s Office filed a motion seeking clarity on Albert’s extension, citing the fact Albert himself wrote in his extension order that he lacks the legal authority to grant Sanborn extra time.

Former GOP state Sen. Andy Sanborn’s most recent deadline extension on the order to sell his Concord Casino may have broken the rules, according to the administrative judge who gave him that extension.

Meanwhile, Sanborn is suing the state over aspects of how it has handled his case, and at least one issue has arisen.

Judge John Kissinger has ordered prosecutors to explain how documents from Sanborn’s lawyers that could be considered legally privileged ended up in the hands of the state’s investigative team. Kissinger ordered the state to provide to the court “factual affidavits on issues related to the past handling of seized documents and materials (including electronically stored information), as well as how clearly privileged documents may have been missed or not properly screened by the taint team,” Kissinger wrote in an Aug. 23 document.

All of which points to a conspiracy by the state to strip Sanborn of his license rather than allow him to sell his valuable asset, Sanborn’s attorneys say.

In an email to New Hampshire Bulletin, Sanborn’s attorneys, Zachary Hafer and Adam Katz, wrote:

“In an eleventh-hour attempt to sabotage a sale of Win Win Win, the same AG who has been enjoined repeatedly for violations of Mr. Sanborn’s constitutional rights by three New Hampshire superior court judges, who has had his legal positions soundly rejected time and again by administrative law judges (overseeing the licensing case), and whose office is currently facing potential sanctions for prosecutorial misconduct, has now arrested Mr. Sanborn on the eve of a sale to a qualified buyer.

“We are disappointed, but not surprised. And we remain confident that the New Hampshire judiciary will continue to do justice and hold the AG accountable.”

Former GOP State Sen. Andy Sanborn’s most recent deadline extension on the order to sell his Concord Casino may have broken the rules, according to the administrative judge who gave him that extension.

Sanborn’s latest official deadline to sell his Concord Casino passed two weeks ago on Sept. 30. Sanborn did get a vaguely defined extension from Administrative Law Judge Gregory Albert to keep his license pending a state review of the potential buyer’s suitability.

Last week, lawyers with the New Hampshire Attorney General’s Office filed a motion seeking clarity on Albert’s extension, citing the fact Albert himself wrote in his extension order that he lacks the legal authority to grant Sanborn extra time.

“Despite this conclusion, [Albert] then contradicted this conclusion by carrying out in practice what [Albert] stated he had no authority to do: the Order stayed the revocation penalty for 30 days after the notice of decision on a motion for rehearing, or if no motion for rehearing is filed, the 16th business day following the Order,” the Attorney General’s motion states.

Albert’s extension allows Sanborn to keep the suspended license until the state is done vetting the potential buyer.

Administrative Law Judges, also known as hearings officers, work for individual state agencies and handle legal questions on how different state laws and regulations are implemented. Officers conduct hearings, write legal opinions, and recommend policies and regulations. They can also impose discipline, such as in the Sanborn case.

Albert replaced retired Administrative Law Judge Michel King, who in December first suspended Sanborn’s gaming license and ordered Sanborn to sell the business. King gave the casino mini-magnate a six-month deadline to sell or face license revocation. 

King found Sanborn engaged in deception when he applied for the $844,000 in COVID loans, and that Sanborn spent the money inappropriately, including the purchase of a Porsche and a Ferrari. According to Formella, Sanborn’s wife, state Rep. Laurie Sanborn (R-Bedford), got the Ferrari as a gift. The alleged COVID fraud first came to light during a state audit more than a year ago.

Sanborn has been getting license extensions since last summer, arguing he cannot sell the business without a license. He’s accused New Hampshire Attorney General John Formella of slowing the sales process. 

Sanborn, a Bedford Republican who was once a top player in state politics, is currently under criminal investigation for COVID relief fraud centered on his casino business. He hasn’t been charged with any crime.

Sanborn is also suing the Department of Justice over matters connected to the criminal investigation. The lawsuit is under seal, though some redacted documents may start getting released later this month. According to one document in the lawsuit that has been made public so far, there is a dispute over evidence seized by investigators, with Sanborn’s side claiming the state had legally privileged information, possibly such as attorney-client communications.

The public may get to see Andy Sanborn’s cards before he’s forced to fold ’em.

The former state senator and Concord Casino owner is suing the New Hampshire Attorney General’s Office, but no one knows why just yet. Nearly the entire case is sealed in Merrimack Superior Court. 

At the same time, Sanborn is under state order to sell his business by the end of the month in the wake of accusations he took $844,000 in COVID relief funds and used the money to pay himself rent and purchase sports cars.

New Hampshire Bulletin’s Annmarie Timmins filed a motion to unseal the case. On Wednesday, Merrimack Superior Court Judge John Kissinger gave attorneys for Sanborn and the state until Oct. 3 to come up with proposed redacted versions of the lawsuit and pleadings. Kissinger said the case is potentially sensitive because it deals with an open criminal investigation, according to Concord Monitor reporting. 

Attorney General John Formella said last year he planned to investigate Sanborn for the alleged COVID fraud, though no charges have yet been filed. 

Sanborn’s lawyers reportedly said Wednesday they are seeking another extension on the deadline to sell the business.

This isn’t the first time the handling of documents has created problems in Sanborn’s case.

NHJournal first reported the story that Kissinger issued an Aug. 23 order instructing prosecutors to explain how documents from Sanborn’s lawyers considered legally privileged ended up with the state’s investigative team.

Among other steps Kissinger ordered, he wants the state to provide to the court “factual affidavits on issues related to the past handling of seized documents and materials (including electronically stored information), as well as how clearly privileged documents may have been missed or not properly screened by the taint team.”

Kissinger’s order indicated there are close to 6,700 documents as part of the discovery in the ongoing investigation thus far. Some of them are in a commercial legal database program called Everlaw. It gives attorneys and law firms the ability to control and share information in large cases, and is frequently used to share discovery.

Prosecutors have been instructed to provide Kissinger with an audit of the state’s activity in the Sanborn Everlaw documents, showing which prosecutor viewed or downloaded any particular document.

Prosecutors involved in the Andy Sanborn criminal probe may have copies of potentially sensitive attorney-client communications.

Sanborn, a former Republican state senator, is at the center of a legal firestorm that began when New Hampshire Attorney General John Formella accused him of COVID-19 fraud last year. 

Sanborn filed a lawsuit in Merrimack Superior Court against Formella’s office this summer, but the pleadings in the case are almost entirely under seal. However, a recent court order from Judge John Kissinger sheds light on at least one aspect of the dispute.

Kissinger ordered prosecutors to explain how documents from Sanborn’s lawyers considered legally privileged ended up with the state’s investigative team. Among other steps Kissinger ordered, he wants the state to provide to the court “factual affidavits on issues related to the past handling of seized documents and materials (including electronically stored information), as well as how clearly privileged documents may have been missed or not properly screened by the taint team,” Kissinger wrote in an Aug. 23 order.

Interior of Andy Sanborn’s Concord Casino visible from locked entrance.

Kissinger’s order indicated there are close to 6,700 documents as part of the discovery in the ongoing investigation thus far. Some of them in a commercial legal database program called Everlaw. Everlaw gives attorneys and law firms the ability to control and share information in large cases, and is frequently used to share discovery.

The order states that a taint team was handling discovery documents before handing them to prosecutors in the investigation. Prosecutorial taint teams are typically prosecutors not connected to the case that is under investigation. The taint team is supposed to read through and examine discovery, removing information considered privileged before giving the rest to the investigating team, or case team.  

Prosecutors have been instructed to provide Kissinger an audit of the state’s activity in the Sanborn Everlaw documents, showing which prosecutor viewed or downloaded any particular document. Sanborn’s legal team is under orders to provide Kissinger legal arguments for why the information should be privileged. 

Communication between lawyers and clients is privileged, meaning it does not have to be disclosed to police or prosecutors. That protection extends to evidence that can be obtained through discovery requests, subpoenas, and even in what is said in sworn depositions. Clients may waive the privilege protection if they choose.

After accusing Sanborn of making false statements in filing for business COVID relief funds, and then spending the part of the money on luxury sports cars, Formella announced his office would instigate a criminal investigation into Sanborn and his wife, state Rep. Laurie Sanborn (R-Bedford.) Both Andy and Laurie Sanborn are owners of Win Win Win LLC/Concord Casino, the business that received $844,000 in COVID money.

Despite the public and damning allegations Formella made last year, neither Sanborn has yet been charged with a crime. Andy Sanborn’s New Hampshire Gaming License was suspended in December after an administrative hearing on Formella’s allegations.

Administrative Law hearing officer Michael King found Sanborn engaged in deception when he applied for the COVID loans, and that Sanborn spent the money inappropriately, including the purchase of a Porsche and a Ferrari. 

“The misrepresentations on the EIDL [Economic Injury Disaster Loan] application and the subsequent use of the proceeds for expenditures not allowed by that loan constitute ‘conduct by the licensee that undermines the public confidence in charitable gaming,’” King wrote in his order.

In addition to the sports cars, Sanborn allegedly paid himself $240,000 with the COVID funds by raising his own rent.

Sanborn owns the Casino through his Win Win Win LLC and he owns the Main Street building where his Concord Casino is located through an entity called The Best Revenge LLC. 

The original lease agreement between Win Win Win and The Best Revenge LLC was for $500 a month. But records showed Sanborn was making payments to himself ranging from $10,000 to $30,000 a month for rent. 

Sanborn claimed the 40-fold rent increase was due to his casino floor space increasing six and a half percent. While it was alleged Sanborn was diverting COVID money to himself through rent, King found Sanborn’s high rental payments to himself started in 2021 before he received any COVID cash.

Sanborn started making payments in November 2021, ranging from $5,000 to $22,000. Those payments were seen as “wildly excessive” by the state.

Sanborn has until the end of the month under King’s order to sell his Concord Casino or face having the license revoked. Without a license, Sanborn has no casino business to sell. 

He’s accused of COVID fraud and under orders to sell his Concord Casino. But former state Sen. Andy Sanborn just raised the bet.

Sanborn filed a new civil lawsuit against New Hampshire Attorney General John Formella in Merrimack Superior Court in Concord on July 30. Sanborn and his legal team are keeping their cards close to their vests. The complaint, as well as nearly all of the filings in the case, are sealed.

Mark Knights, one of Sanborn’s lawyers, declined to comment when contacted by NHJournal. The New Hampshire Attorney General’s Office did not respond to a request for comment as well.

What is known about the case from the publicly available information is that Sanborn is seeking an injunction of some kind, presumably to block the state from taking a particular action. Additionally, the Attorney General’s Office has prosecutors Dan Jimenez, David Lovejoy, and Alex Kellerman assigned to the case. Jimenez is part of the Public Integrity Unit which investigates wrongdoing by public officials. Lovejoy is part of the Criminal Justice Bureau. Kellerman is a former corporate attorney now working for the attorney general.

Sanborn’s legal drama began a year ago when Formella publicly accused Sanborn and his wife, state Rep. Laurie Sanborn (R-Bedford), of COVID relief fraud. According to Formella, the couple took $844,000 in COVID relief payments for their Concord Casino and used the money to pay themselves via rent and buy themselves sports cars.

The Sanborns deny wrongdoing and have yet to be charged with a crime. However, the state pushed to take away the Concord Casino gambling license based on the alleged fraud. In December 2023, Administrative Law hearing officer Michael King found Sanborn engaged in deception when he applied for the COVID loans and that Sanborn spent the money inappropriately.

“The misrepresentations on the EIDL [Economic Injury Disaster Loan] application and the subsequent use of the proceeds for expenditures not allowed by that loan constitute ‘conduct by the licensee that undermines the public confidence in charitable gaming,’” King wrote in his order.

Aside from using the money to buy a Porsche and a Ferrari, Sanborn allegedly paid himself $240,000 with the COVID funds by raising his own rent.

Sanborn owns the Casino through his Win Win Win LLC and he owns the Main Street building where his Concord Casino is located through an entity called The Best Revenge LLC. 

The original lease agreement between Win Win Win and The Best Revenge LLC was for $500 a month. But records showed Sanborn was making payments to himself ranging from $10,000 to $30,000 a month for rent. 

Sanborn claimed the 40-fold rent increase was due to his casino floor space increasing six and a half percent. While it was alleged Sanborn was diverting COVID money to himself through rent, King found Sanborn’s high rental payments to himself started in 2021 before he received any COVID cash.

Sanborn started making payments in November 2021, ranging from $5,000 to $22,000. Those payments were seen as “wildly excessive” by the state.

Sanborn’s casino license was suspended and he was given six months to sell his business. That deadline has been pushed to the end of September as Sanborn continues to fight with the Attorney General’s Office. 

The state has been trying to exert influence over the sale, according to NH Bulletin reporting, while potential buyers have been scared off by the potential criminal charges. Sanborn’s lawyers have accused the state of trying to stop any sale out of spite. 

If Sanborn is unable to sell his business by the Sept. 30 deadline, his gaming license will expire, and he would not have a casino business to sell.

Andy Sanborn, who ran a failed bid for the GOP nomination in the First Congressional District in 2018, has a troubled past in politics. He was investigated for alleged sexual harassment of a Senate intern in 2013, though he maintains it was a misunderstanding about a joke.

When Sanborn first got his casino license in 2018, the harassment incident came back. That time he was investigated for allegedly bribing one of the witnesses. He was cleared of the bribery accusation, but the New Hampshire Lottery Commission was concerned about his suitability to hold a license. According to Commission records, one of the 2018 witnesses told investigators she was warned not to be alone with Sanborn when she started her job in the State House.

Andy Sanborn’s luck has run out.

After finding Sanborn lied on his application for $844,000 in COVID relief money and then used that cash to pay himself $240,000 and buy sports cars, hearing officer Michael King ordered Sanborn to sell his Concord Casino business.

King is the independent hearing officer who presided over the administrative rules hearing regarding complaints brought by the New Hampshire Lottery Commission against Sanborn, a former GOP state senator and one-time candidate for Congress.

“The misrepresentations on the EIDL [Economic Injury Disaster Loan] application and the subsequent use of the proceeds for expenditures not allowed by that loan constitute ‘conduct by the licensee that undermines the public confidence in charitable gaming,’” King wrote in an order released Thursday.  

Sanborn’s casino license is now suspended for six months, during which time he must find a buyer who can pass the New Hampshire Lottery Commission’s background check. If no suitable buyer is found in that time, the license will be revoked.

Testimony from this month’s hearing and evidence filed in the case revealed Sanborn tried to hide the fact from the federal government that his EIDL loan was going to a casino business. Casinos were not eligible for the EIDL program.

Sanborn and loan consultant Michael Evans listed the business as “Win Win Win LLC” and did not use the trade name “Concord Casino,” King noted in his order. The pair also claimed the business engaged in “miscellaneous services” and not that it was a “charitable gaming facility,” according to King.

When Sanborn started getting the COVID money, he had a little more than $900 in his business bank account, according to King. Within a couple of weeks, Sanborn started buying. According to the evidence, he bought a pair of Porsches, a Ferrari for his wife, state Rep. Laurie Sanborn (R-Bedford), and expensive car parts.

Those purchases would be listed as business equipment in Win Win Win’s financial statements, according to the review.

Further, Sanborn paid himself $240,000 in rent between January and August 2022 for the casino’s Main Street space in Concord. 

Sanborn owns the building housing the casino through a different LLC called The Best Revenge LLC. While the original lease agreement between Win Win Win and The Best Revenge is for a $500 a month lease, Sanborn was making payments to himself ranging from $10,000 to $30,000 a month for rent, according to the evidence. 

Sanborn claimed the 40-fold rent increase was due to his casino floor space increasing six and a half percent. While it was alleged Sanborn was diverting COVID money to himself through rent, King found Sanborn’s high rental payments to himself started in 2021 before he received any COVID cash.

Sanborn started making payments in November 2021, ranging from $5,000 to $22,000. Those payments were seen as “wildly excessive” by the state.

The decision ends Sanborn’s second act as a casino owner. He was in the process of developing a larger casino in Concord when the state alleged he had fraudulently obtained the COVID money.

Sanborn has 15 days to appeal King’s decision, though he might have other legal concerns. The New Hampshire Attorney General’s Office and the United States Attorney’s Office are now looking into Andy and Laurie Sanborn. The pair are the subject of an investigation by the Attorney General’s Public Integrity Unit.

“It was off the charts.”

Leila McDonough, the New Hampshire Lottery Commission auditor, described the volume of issues the state had with Andy Saborn’s Concord Casino.

McDonough made the comments during a Monday hearing over whether the former state senator can keep his casino owner’s license despite accusations of fraud, including using COVID relief money to buy sports cars. While Sanborn’s attorneys claimed Sanborn did nothing wrong, McDonough testified Sanborn never cared to follow the rules.

The Department of Safety showdown featured one witness for the state, McDonough, the woman who for years was tasked with trying to get Sanborn to follow state regulations.

McDonough’s testimony painted the picture of Sanborn as entitled and stubborn, a casino operator whose refusal to follow basic accounting procedures created a huge mess — or worse, led to massive fraud.

For instance, when a casino owner claims to have hundreds of thousands in cash, but he won’t let the state auditor in charge of casino financial reports count the money, you have a problem, she said.

“How can you conduct an audit that includes cash when you’re not allowed to count the cash?” McDonough asked. “Eventually, you have to assume the cash doesn’t exist since you’re not allowed to see it or count it.”

She said Sanborn was difficult to deal with since he opened his casino in 2018. Both Sanborn and his wife, state Rep. Laurie Sanborn, would call the commission to complain about audits and regulations they had to follow, McDonough said. The Concord Casino’s record-keeping was sloppy at best, she added, and Sanborn never appeared to take the legal requirement from the commission seriously. 

McDonough is the Lottery Commission auditor who spotted enough red flags to go to the commission’s enforcement officials. who then brought in New Hampshire Attorney General John Formella. Formella has said a criminal probe by his office is also underway.

At one point, McDonough said, she found a statement of cash flows for July 2021 through to July 2020.

“This is actually the document that made me very concerned,” McDonough said.

That document showed Sanborn’s casino ran a $29,000 operating loss in that year and had no cash. This was at the time Sanborn claimed to have $200,000 in cash in secure locations McDonough was not allowed to see.

The statement also showed a large amount of cash invested in large equipment that had little to do with the business, like two Porsches and a Ferrari. The Ferarri was reportedly a gift for Laurie Sanborn. 

Sanborn still managed to report $23,000 in cash for owner’s equity, McDonough testified. According to the records, Sanborn reported taking $5,700 in cash out of a bank and putting that into the equity cash amount.

“I’ve never seen this done with any other entity,” she said. “That was very odd.”

The financial statement McDonough revised seemed to show the whole operation was being funded with $844,000 in COVID relief loan money. The records also repeatedly showed large ticket purchases like the sports cars and tens of thousands in car parts charged business expenses.

McDonough reportedly uncovered Sanborn was also paying himself rent for the casino. The casino is owned through Sanborn’s LLC called Win, Win, Win LLC, but the Main Street property in Concord, where the casino is housed, is owned by another Sanborn LLC, The Best Revenge LLC.

The lease agreement between Best Revenge and Win, Win, Win has the casino pay the property $6,000 a year in rent, paid at $500 a month. According to the audit, Sanborn wired $163,500 from Win, Win, Win to Best Revenge between January and August 2022 to cover the rent. 

That was more than $20,000 a month for the $500 a month rent.

McDonough said the records had a lot of large, round numbers for expenses that lacked detail and supporting documentation.

Sanborn was not at the hearing. One of his attorneys,  Zachary Hafer, said Sanborn is in Boston receiving medical treatment. His legal team includes attorney Mark Knights, who argued the state’s case simply does not stand up to scrutiny.

“It is an incomplete story that has yawning gaps in the evidence,” Knights said.