Just 5 years after being at the centre of a “child vice racket” and going to be closed down, Playland as well as other amusement arcades were again causing problems for authorities, this time for the Customs authorities in charge of overseeing VAT was paid.
20th Aug 1981 The Times by Stewart Tendler Customs recover record £2.7m from amusement arcade VAT frauds [1] Text for the article is also in Timeline below.
This clipping is noteworthy for several reasons
- Operation Nudger lasted a year and involved 100 Customs officers in undercover work watching amusement arcades. This was the largest ever operation at the time. It appears to be VAT fraud.
- Commissioners for Customs and Excise used rarely used powers under the Customs and Excise Management Act 1979 to halt the prosecution
- The settlement is more than twice the figure of £1.3m recovered in VAT cases
last year through fines, the award of costs and settlements. - This took place in a magistrates court??!
- One of the Companies involved is Piccadilly Amusements Ltd who were the company that owned Playland, which was the Operation Centre of a child sex scandal in 1975 when the Managing Director was Bruce Eckert.
- The companies in court are said to have underdeclared gross takings by £10M but only had to pay £2.7M as payment, penalties and legal costs. That appears generous. This appears to be spun as a good deal just because it happened to be more as Customs normally retrieved in a year.
This throws up many questions
- Why did customs choose to resolve this at Magistrates court using a rarely used power and not go to a full criminal trial?
- Who actually took the decision for Customs and Excise?
- Alan Hughes was the customs man who oversaw the deal in court between the companies and those charged, and the customs. Was the decision maker Alan Hughes mentioned in the article or someone else? Is this the same Alan Hughes? [4] Linked In page. If someone can view the page link and it is demonstrably not, then I shall remove this.
- Which is the rarely used power of Customs Act? It is not immediately obvious to me on browsing Customs and Excise Management Act 1979 [19] , pdf download [19a]
- All the individuals avoided a trial facing criminal charges. Why?
- Some of the charges were fraud. Can you just buy your way out of fraud charges? The men involved Mr Martin Bromley, Mr James Humpert, Mr Richard Stewart, his son Scott Stewart, Mr Alan Rawlinson, Mr Hasmukhray Shah, Mr Vasant Malde and Mr Scott-Dotterer.
- Several of the men founded the precursor companies Service Games, to Sega [28]. What were the connections between all the men?
- What were all the actual charges? Why were the companies all charged together?
- What other unseen deals were done?
- What happened to the Inland Revenue investigation over tax?
Playland
Piccadilly Amusements was the Company that owned Playland [5] [5a], which had been “named in the Central Criminal Court …as the operation centre of a homosexual
vice racket involving young runaway boys ” just 6 years earlier in 1975 [6]. Was Bruce Eckert still the Managing Director? Who were the Directors?
In the earlier case Eckert had blamed said that people employed by him to watch the premises had failed in their duty to report what was going on. Who was to blame this time? It seems scarcely credible that Eckert or whoever had replaced him could have failed to notice deliberate fraud on this scale. If he had not noticed it then his employees were defrauding him.
In this VAT case, Playlands employee or perhaps the accountant or bookkeeper, Mr Hasmukhray Shah faced a charge along the lines of “delivering VAT returns falsely”, relating to a return for tax in the sum of £32,413, relating to Piccadilly Amusements Ltd.
In 1975 what action did Eckert take with the the managers he blamed for not informing him of the child abuse that was going on? Did he sack them? Were the arcade managers oblivious of the abuse? Did they turn a blind eye to it? Was Eckert still on board of Piccadilly Amusements? Did he know the others?
Back in 1961 Bruce Eckert was convicted of “conspiring to evade taxes” and altering official documents to avoid payment of taxes and fined $7,500 tax evasion in the biggest tax case in the history of the Ryukyu Islands [13]. This was by the US Civil Administration Court, Judge Russell L Stevens. These are islands south of Japan, but independent, of which the largest is Okinawa [30]
Eckert was described as a manager. It is unclear whether this was a manager of Service Games or something else. Service Games Inc. was described as a supplier of slot machines to the US Military Clubs on Okinawa. They were fined $10,300. Eighty US military and 30 Okinawa Police had swooped on the Service Games Inc. Company Offices.
Yoshimi Yashima and Frank Pontillo were also found guilty but Harold Watanabe was acquitted. Warren Magee of Washington DC representing Service Games of Naha and Panama City, said they would appeal [13] .
Eckert was also involved in an unsuccessful computerised horoscope venture called Astroflash in 1969 in Piccadilly Circus. Started on Nov 21 it had to close in January after large losses [14]
Were the reasons given for the quashing of charges in the appeal courts of Playland 2 valid? To a layperson, there appear many cases of multiple charges like this today. Perhaps a lawyer could comment. Were they sufficient to quash convictions? [24]
In 1975 Hornby had got off lightly as described in my post Paedophilia around Piccadilly Part 4 Playland Trial and Cover up [7] and then all defendants had their sentences reduced and most convictions quashed. Was this connected to the threats of Archer and the connection to high profile figures? Archer had threatened to present police with a dossier naming “millionaires and titled and inflential people” [10]
A suvivor of abuse by abusers in Playland 2 trial describes it as “gangland controlled Playland”, and tells how he was taken to an upstairs office threatened and intimidated. One of his later abusers was there, and a man behind the desk and some heavies. The survivor says that he drank in the Pronto Bar next door with other “rent boys” [8]
This appears to indicate that not only did management know what was going on but child abusers were friendly with the management.
Combine that with the management coming to a deal with customs / government over unpaid VAT, and there is obviously potential at the very least for individual and perhaps state corruption.
Were the management of Playland involved in actually organising the abuse of children out of personal desire and /or profit? Were the management of Playland involved in child trafficking to different arcades or parts of the country or prominent people or even to different countries?
Was this an international criminal network who were avoiding tax and trafficking children for sex and money? Was this covered up by the establishment courts, Customs, police and politicians because they were involved in some way?
What was the relationship between Piccadilly Amusements and the other companies involved in this VAT Court case?
1981 VAT Court Case – other Companies
Men involved
- Mr Martin Bromley
- Mr James Humpert
- Mr Richard Stewart
- his son Scott Stewart
- Mr Alan Rawlinson
- Mr Hasmukhray Shah
- Mr Vasant Malde
- Mr Scott-Dotterer
Martin Bromley had changed his name from Martin Bromberg in 1945 [28]
Four were American, not known which ones. Bromley’s address was in Panama [1]
Four had very strong connections to Service Games – Bromley, Humpert, Richard Stewart and Scott-Dotterer [28]
Bromley, Humpert, Stewart were experienced in the slot machine industry. For over 25 years dealing with different companies and countries and were wealthy.
They had connections with US military in Hawaii as far back as 1945 [28] [Appendix 1 ], and also military connections via Okinawa [13]. Is this military connection significant?
The companies involved were
- Piccadilly Amusements Ltd;
- Atlantic Amusements Ltd,
- Family Leisure Ltd;
- J.W.D. Amusements Ltd;
- Aladdin’s Castle Ltd;
- Big Game Ltd; and
- F Peeney and Sons Ltd.
What country were they registered in? Who were the directors? Why were they all tried together?
It would appear that deliberate criminal acts were carried and the perpetrators got away with paying money via the legal system. Did they also pay money via illicit means?
Police Corruption and Police relationship with Customs
Another factor to be taken into account is the Police corruption that was unearthed in the 1970s in Scotland Yard. The third and largest investigation that decade was into the Obscene Publications Squad who operated mainly very nearby in Soho.
The second investigation of the 1970s was into corruption in the drugs squad and particularly Detective Chief Inspector Kelaher. This affected the relationship between Customs and the Police.
As the rabbit hole of police corruption and the police relationship with customs is quite deep it will have to be dealt with in a future post.
Brief Timeline
1945 – Standard Games of Hawaii is sold [28] Irving Bromberg, Martin Bromberg, and James Humpert form a new company called Service Games, Hawaii to distribute slot machines and other coin-operated devices to US military facilities on the islands.
Martin Bromberg changed his name to Martin Bromley.
• February 15, 1952 – Service Games, Hawaii and salesman Richard Stewart enter into agreement by which Stewart will move to Japan and open a distribution office [28]
• September 10, 1953 – Service Games, Inc., Panama files for incorporation and becomes the controlling corporation for all of the other Service Games entities. Irving Bromberg, Marty Bromley, Raymond Stewart, Raymond Lemaire, and James Humpert each have a 20% stake (200 shares of stock) [28]
1960 Sep 12 Billboard [15] Sep 12, 1960 Service Games, Inc Service Games adds Taiwan and Okinawa
1961 April 21 The Daily Telegram, Eau Claire, Wisconsin · Page 16 [13]
1969 Mid June [28]– Gulf + Western buy out Marty Bromley, Richard Stewart, and Scott Dotterer’s interest in Sega Enterprises, Ltd. Bromley is paid 1,673,429 and 114,065 shares of Gulf + Western stock, Richard Stewart gets $836,710 and 57,032 shares, Scott Dotterer gets $371, 901 and 23,350 shares.
1969 Consumer Affairs Bulletin re Bruce Eckert [14] https://t.co/dzFpAWUa3s
1975 Sept 23 Guardian [12] From the archive, 23 September 1975: Police to shut arcades of vice One MP, Mr Marcus Fox, Conservative member for Shipley, Yorkshire, said yesterday he was writing to the Home Secretary to ask Mr Jenkins whether he was satisfied that local authorities had the necessary powers to close premises involved in activities disclosed by the Playland case. [Interesting to see the reply on that]
1975 Sep 26 The Times [6] Michael Horsnell Council to decide on Playland Arcade. Court cases bring home the plight of many runaway children
1976 April 8 The Times [5a] Playland the amusement arcade near Piccadilly, London is to remain open
1976 Nov 30 Daily Mail [10] via Spotlight Playland Vice Case Man freed
1977 July The Fall of Scotland Yard [11] Barry Cox, John Shirley, Martin Short
Describes three investigations into Scotland Yard corruption in the 70’s
20th Aug 1981 The Times by Stewart Tendler Customs recover record £2.7m from amusement arcade VAT frauds [1]
Britain’s largest value added tax evasion case ended yesterday with a
record out-of-court settlement of £2.7m after a customs investigation into
amusement arcades in London and Blackpool linked to an international
business group. At Horseferry Road Magistrates Court in London eight
businessmen, including four Americans, faced with specimen charges, were
discharged after Mr Alan Hughes, acting for the Customs and Excise,
announced the settlement. Mr Hughes said the case involved ” enormous
suppression” of gross takings estimated to be £10m. The Inland Revenue is
also to examine the case in a separate investigation. The end of the case
came yesterday with the presentation of a banker’s draft for more than £2m
which was paid into the Bank of England after verification by a cashier
specially brought to the court. The £2.7m represents £1.25m in lost VAT
payments, £1.25m in lieu of penalties for evasion and £200,000 costs. Mr
Hughes told Mr Edmund McDermott, the magistrate, that the Commissioners for
Customs and Excise had enacted rarely used powers under the Customs and
Excise Management Act 1979 to halt the prosecution. The defendants and 15
associated companies had agreed to pay their own costs. The businessmen
were arrested after a customs investigation, codenamed Operation
Nudger, which lasted a year and involved 100 officers in undercover work
watching amusement arcades. The operation, the largest mounted by
customs, took its name from the nudge button found on arcade machines. The
settlement is more than twice the figure of £1.3m recovered in VAT cases
last year through fines, the award of costs and settlements. The
defendants were: Mr Martin Bromley, aged 62, giving addresses in Panama and
London; Mr James Humpert, aged 70, of Roebuck House, Palace Street,
Westminster; Mr Richard Stewart, aged 56, of Kingston House, Prince’s Gate,
South Kensington, and Mr Alan Rawlinson aged 36, of Buckingham Mansions,
West End Lane, West Hampstead, who had been charged with sending to the
commissioners a VAT return falsely showing that tax due from Family Leisure
Ltd, was £11,167 whereas a greater sum was payable. Mr Hasmukhray Shah,
aged 38, of Littleton Road, Harrow, and Mr Vasant Malde, aged 32, of
Portland Crescent, Stanmore, Middlesex, had faced a similar charge
relating to a VAT return for £6,672. Mr Stewart’s son, Scott Stewart,
aged 30, of Little Chester Street, Westminster, was charged with taking
steps with a view to ‘fraudulent evasion of VAT’ and Mr Scott-Dotterer,
aged 30, of Clifton Drive South, Lytham St Annes, Lancashire, was
charged with delivering VAT returns falsely showing that tax due was
£2,681 and £933. Mr Shah also faced a similar charge relating to a return
for tax in the sum of £32,413, relating to Piccadilly Amusements Ltd.
The companies said to have been directly involved were named as
Piccadilly Amusements Ltd; Atlantic Amusements Ltd, Family Leisure
Ltd; J.W.D. Amusements Ltd; Aladdin’s Castle Ltd; Big Game Ltd; and
F Peeney and Sons Ltd.
2012 Sept Sonic Retro [29] SEGA DOESN’T KNOW THEIR OWN HERITAGE, FILM AT 11
2014 May 10 Spotlight [9] The Playland Cover Up
2015 Feb 11 [23] Bits of Books Playland 1970-1975: When protecting ‘millionaires titled and influential’ paedophile punters becomes paramount and other articles
2015 May 6 cathy fox blog [16] Paedophilia around Piccadilly Part 4 Playland Trial and Cover up
2015 May 12 The Golden Age Arcade Historian [28] The Early History of Sega – Service Games Part 2 – When was Sega/Service Games Founded. Article contains information about SErvice GAmes [see Appendix 1]
2015 May All in Colour for a quarter [27] The Early History of Sega – Service Games Part 1 – the Prehistory of Service Games
2015 May 12 The Golden Age Arcade Historian [28] The Early History of Sega – Service Games Part 2 – When was Sega/Service Games Founded
2015 Nov 19 Byline CassandraCogno Russell [23] Playland Part 1: When protecting ‘millionaires, titled and influential paedophile punters became paramount
2016 Jan 24 Cathy Fox Blog [3] Paedophilia around Piccadilly Part 5, 1980s and Operation Circus
Please note that victims of abuse may be triggered by reading this information. These links are generally UK based.
- The Sanctuary for the Abused [A] has advice on how to prevent triggers.
- National Association for People Abused in Childhood [B] has a freephone helpline and has links to local support groups.
- Other useful sites are One in Four [C]
- and Havoca [D].
- Useful post on Triggers [E] from SurvivorsJustice [F]blog.
- Jim Hoppers pages on Mindfulness [G] and Meditation [H] may be useful.
- Hwaairfan blog An Indigenous Australian Approach to Healing Trauma* [J]
Please consider researching child sexual abuse or a child abuser in your area or institution. 10 steps to researching child sexual abuse in your area [100]
Links
[1] 1981 Aug 20th The Times Customs recover record £2.7m from amusement arcade
VAT frauds – see above
[2] Yahoo Answers https://answers.yahoo.com/question/index?qid=20100330170132AASk9pU re Mr Humpert and Sega. Sega was founded in 1940 as Standard Games (later Service Games) in Honolulu, Hawaii, United States, by Marty Bromley, Irving Bromberg, and James Humpert to provide coin-operated amusements for American servicemen on military bases.
[3] 2016 Jan 24 Cathy Fox Blog Paedophilia around Piccadilly Part 5 1980s and Operation Circus https://cathyfox.wordpress.com/2016/01/24/paedophilia-around-piccadilly-part-5-1980s-and-operation-circus/
[4] An Alan Hughes Linked In https://www.linkedin.com/in/alan-hughes-a7222246
[5] 2015 Jan Cathy Fox Blog Playland 1976 – Centre of Child Vice Racket – Did it get shut down? https://cathyfox.wordpress.com/2016/01/25/playland-1976-centre-of-child-vice-racket-did-it-get-shut-down/
[5a] 8th April 1976 The Times Playland the amusement arcade near Piccadilly, London is to remain open. https://cathyfox.wordpress.com/2016/01/25/playland-1976-centre-of-child-vice-racket-did-it-get-shut-down/
[6] 1975 Sep 26 The Times Michael Horsnell Council to decide on Playland Arcade. Court cases bring home the plight of many runaway children https://cathyfox.wordpress.com/2016/01/25/playland-1976-centre-of-child-vice-racket-did-it-get-shut-down/
[7] 2015 May 6 cathy fox blog Paedophilia around Piccadilly Part 4 Playland Trial and Cover up https://cathyfox.wordpress.com/2015/05/06/paedophilia-around-piccadilly-part-4-playland-trial-and-cover-up/
[8] pers comm
[9] 2014 May 10 Spotlight The Playland Cover Up https://spotlightonabuse.wordpress.com/2014/05/10/the-playland-cover-up/
[10] 1976 Nov 30 Daily Mail via Spotlight Playland Vice Case Man freed https://spotlightonabuse.files.wordpress.com/2014/05/mail301176.jpg
[11] 1977 July The Fall of Scotland Yard Barry Cox, John Shirley, Martin Short http://www.amazon.co.uk/gp/product/0140523189?keywords=the%20fall%20of%20scotland%20yard&qid=1454104169&ref_=sr_1_1&sr=8-1
[12] 1975 Sept 23 Guardian From the archive, 23 September 1975: Police to shut arcades of vice http://www.theguardian.com/society/2015/sep/23/playland-amusement-arcade-prostitution-vice-piccadilly
[13] 1961 April 21 The Daily Telegram from Eau Claire, Wisconsin · Page 16 re Bruce Eckert Service Games http://t.co/c62pJSlvB5 HT @snowfaked
[14] 1969 Consumer Affairs Bulletin 1969 page 3 re Astroflash Bruce Eckert
https://books.google.com/books?id=uApZAAAAYAAJ&q=%22and+calendar+for+the+next+six+months%22&dq=%22and+calendar+for+the+next+six+months%22&hl=en&sa=X&ved=0CCsQ6AEwAGoVChMI1_uEq7jNyAIVQhk-Ch3gaAgm and https://t.co/dzFpAWUa3s HT @snowfaked
[15] 1960 Sep 12 Billboard Sep 12, 1960 Service Games, Inc Service Games adds Taiwan and Okinawa https://t.co/9rd0vIhy0X HT @snowfaked
[16] 1973 Illustrated London News and Sketch 16 Coventry St Bales Tours travel agency there. Bale Tours First Floor? @snowfaked. Basement office Bernard Briggs – ground level slot machines/arcade @cassandracogno
https://books.google.com/books?id=6S5DAQAAIAAJ&q=%2216+coventry+street%22+london&dq=%2216+coventry+street%22+london&hl=en&sa=X&ved=0CCYQ6AEwAmoVChMI15yqkYXNyAIVzFU-Ch0hUQXp HT @snowfaked
[17] 2015 Oct @Snowfaked tweets re Playland, Se Ga https://twitter.com/Snowfaked/status/655864285105668096
[18] 1986 May 16 Spotlight Aids blast by Judge in Gay Boy Scandal https://spotlightonabuse.wordpress.com/2016/01/29/aids-blast-by-judge-in-gay-boy-scandal-16-5-86/
[19] Customs and Excise Management Act 1979 http://www.legislation.gov.uk/ukpga/1979/2/contents
[19a] Customs and Excise Management Act 1979 download http://www.legislation.gov.uk/ukpga/1979/2/pdfs/ukpga_19790002_en.pdf
[20] 2015 Nov 19 CassandraCogno Russell Playland Part 1: When protecting ‘millionaires, titled and influential paedophile punters became paramount https://www.byline.com/column/27/article/539
[21] 1974 Gordon Honeycombe Adams Tale https://www.amazon.co.uk/gp/offer-listing/0099111209/ref=sr_1_2_twi_pap_2_olp?ie=UTF8&qid=1454259446&sr=8-2&keywords=Adams+Tale
[22] Wikipedia Ryukyu Islands https://en.wikipedia.org/wiki/Ryukyu_Islands
[23] 2015 Feb 11 Bits of Books Playland 1970-1975: When protecting ‘millionaires titled and influential’ paedophile punters becomes paramount and other articles https://bitsofbooksblog.wordpress.com/2015/02/11/1972-1976-the-art-of-pervasion-playland-paedophiles-power-and-politics/
[24] 1976 Dec Appeal Novac, Archer, Raywood, Andrew-Cohen 1976 Dec 15 Court of Appeal via 2015 May 7 Cathy Fox Blog https://cathyfox.wordpress.com/2015/05/07/court-of-appeal-15th-december-1976-malcolm-jack-raywood-basil-john-andrew-cohen-david-archer-and-andrew-novac/
[25] Please consider researching child sexual abuse or a child abuser in your area or institution. 10 steps to researching child sexual abuse in your area [92]
[26] 2008 Sept 8 Intergame Online Industry icon Marty Bromley passes away http://www.intergameonline.com/coin-op/news/1287/industry-icon-marty-bromley-passes-away HT @snowfaked
[27] 2015 May All in Colour for a quarter The Early History of Sega – Service Games Part 1 – the Prehistory of Service Games http://allincolorforaquarter.blogspot.co.uk/2015/05/the-early-history-of-sega-part-1.html HT @snowfaked
[28] 2015 May 12 The Golden Age Arcade Historian The Early History of Sega – Service Games Part 2 – When was Sega/Service Games Founded http://allincolorforaquarter.blogspot.nl/2015/05/the-early-history-of-sega-service-games.html HT @snowfaked
[29] 2012 Sept Sonic Retro SEGA DOESN’T KNOW THEIR OWN HERITAGE, FILM AT 11 http://www.sonicretro.org/2012/09/sega-doesnt-know-their-own-heritage-film-at-11/
Misc re Piccadilly players it seems Americans were wielding a lot of control? Leroy Jones from trial #2 was from US, [1972] EWCA Crim J0629-5 for Malcolm McConahy Cass
American Malcolm Willis McConahy (aka Adam Starchild) was also up to no good in London then too, and George Jacobs NASA,
Please consider researching child sexual abuse or a child abuser in your area or institution. 10 steps to researching child sexual abuse in your area [100]
Appendix 1
2015 May 12 The Golden Age Arcade Historian The Early History of Sega [28]– Service Games Part 2 – When was Sega/Service Games Founded
NOTE – since my first post, I have finished reading the two source documents (or at least the parts referencing Service Games and Sega) and have new information, so I thought I would reorganize the posts and create one that just concentrates on Sega’s founding date (I changed my previous post to just talk about the pre-history of Service Games).
So when was Sega founded? Sega’s website says it was 1951.
Of course it depends on what you mean by Sega and what you mean by founded. Others say it was 1952, 1965, or some other date.
Since Sega was preceded by Service Games, you might trace Sega’s founding to the founding of Service Games. So when was Service Games founded, and when did it become Sega? It depends on which “Service Games” you mean. Various entities existed under that name in the 1950s and ‘60s.
Here is a list of some of them. Note that most of these were subsidiaries rather than separate corporations:
Service Games, Inc. – Service Games, Hawaii, Inc. – Service Games, Japan, Inc.
Service Games, Korea, Inc. (located in Okinawa, later became Garlan) – Service Games, Philippines, Inc. – Service Games, Panama, Inc. – Service Games, Nevada, Inc.
There were also several other entities with different names allege to have been affiliated with Service Games, many of which had the same partners/executives.
This is the only ad I could find mentioning Service Games – from the April 2, 1949 issue of Billboard
To help answer the question at hand, here is a brief timeline:
• 1945 – Standard Games of Hawaii is sold. Irving Bromberg, Martin Bromberg, and James Humpert form a new company called Service Games, Hawaii to distribute slot machines and other coin-operated devices to US military facilities on the islands. Service Games is formed as a partnership with each partner contributing $50,000 in capital.
Humpert served as the company’s PR man, finding locations for machines and “keeping location owners happy.”
Martin Bromberg changed his name to Martin Bromley.
• February 15, 1952 – Service Games, Hawaii and salesman Richard Stewart enter into agreement by which Stewart will move to Japan and open a distribution office, while Service Games will supply him with machines and pay him a 10% commission on gross sales.
• February 1952 – Marty Bromley sends Stewart and mechanic Raymond Lemaire to Japan to promote and expand sales of Service Games on US military bases in the Far East. In Tokyo, they form a partnership called Lemaire & Stewart, which also does business as Japan Service Games, and Service Games, Japan.
Stewart and Lemaire leave the employment of Service Games, in which they have no financial interest at the time.
The partnership later becomes successful enough to warrant the establishment of factories and a sales organization.
• 1953 – Service Games, Japan, Inc. is organized??
In the senate report, Delmar Fox, Assistant Chief of the Fraud Investigations Division, Office of Special Investigations, US Air Force testified “I was able to trace the evolution of the Bromley enterprises in Japan to Service Games, Japan, Inc., which was organized in 1953.” I am unsure of this. I don’t know if Service Games, Japan was ever an actual corporation or if it was just a dba name for Lemaire & Stewart. It was referred to numerous times in the testimony, but I didn’t find any place that said it was actually incorporated as a separate company
• September 10, 1953 – Service Games, Inc., Panama files for incorporation and becomes the controlling corporation for all of the other Service Games entities. Irving Bromberg, Marty Bromley, Raymond Stewart, Raymond Lemaire, and James Humpert each have a 20% stake (200 shares of stock).
• September 22, 1953 – Service Games, Panama’s second board meeting provides for Lemaire & Stewart to represent Service Games in Japan
• April 24, 1954 – first use in commerce, and first use anywhere of the Sega trademark for coin-op amusement machines, as per the 4/2/1962 trademark application
• April 30, 1955 – Martin Bromley and Irving Bromberg buy Humpert’s interest in Service Games, including Service Games, Panama, for $50,000 each.
• January 2, 1956 – Raymond Lemaire buys 50 shares in Service Games, Panama from Irving Brombeg for $30,000. Richard Stewart buys 50 shares from Marvin Bromley for the same amount. All four now own 250 shares (25% of the company)
• 1957 – Service Games, Nevada is incorporated. Korwin Hailey is president, Martin Bromley is VP, Irving Bromberg is secretary-treasurer, R.N. Nickels is director. Hailey subsequently names Stewart and Lemaire as members of the firm as well. Service Games, Nevada and Service Games, Japan have same cablecram code.
• May 31, 1960 – Service Games (Japan), Inc. is dissolved. Two new companies are organized: Nihon Goraku Busan Kabushiki Kaisha (Japanese Automatic Manufacturers Company, Inc – sometimes called Nippon Goraku Bussan) and Nippon Kikai Seizo KK (Japanese Machine Manufacturers Co. Inc.). Nihon Goraku Bussan was a distributor of coin-op amusement devices while Nippon Kikai Seizo manufactured slot machines and also did business as Sega, Inc.
• June 1960? – According to Moody’s international manual, Sega was “established” in June 1960 as “Nihon Goraku Bussan Co. Ltd.”
Not sure about this one either. Is NGB “Co Ltd” a different company than NGB “KK”? I’m guessing that they are referring to the May 31 event.
• September 5, 1960 – Billboard reports that the assets of Service Games (Japan), Inc. have been purchased by Sega, Inc. and Ultimatic Inc. (managing director: Richard Stewart) – Service Games itself has been liquidated
I think Sega, Inc. is Nippon Kikai ‘Seizo and Ultimatic is Nihon Goraku Bussan
• March 31, 1961 – Irving Bromberg and Marty Bromley sell Service Games, Hawaii, Inc. to a group headed by Harold Okomoto for $1.4 million – they reserve the use of the name “Service Games” for their foreign operations
• April 2, 1962 – Nippon Kikai Seizo files two trademarks on name “Sega”, one fior use on jukeboxes the other for use on other coin-op amusement devices
• April 12, 1962 – Service Games, Panama, Inc. changes its name to Club Overseas Inc., Panama
• June 1964 – Nihon Goraku Bussan acquires Nippon Kikai Seizo
• July 1, 1965 – Rosen Enterprises and Nihon Goraku Bussan merge to form Sega Enterprises, Ltd.
NOTE that according to David Rosen’s testimony in 1971, what technically happened was that Rosen Enterprises was acquired by Nihon Goraku Bussan
• Mid June 1969 – Gulf + Western buy out Marty Bromley, Richard Stewart, and Scott Dotterer’s interest in Sega Enterprises, Ltd. Bromley is paid , 1,673,429 and 114,065 shares of Gulf + Western stock, Richard Stewart gets $836,710 and 57,032 shares, Scott Dotterer gets $371, 901 and 23,350 shares.
• January 5, 1970 – Gulf + Western completes its buyout of Sega. David Rosen gets $513,173 and 32,850 shares and his wife Masako gets $185,894 and 11,881 shares. Based on the price of the stock at the time, the total sales price for the 1969 and 1970 transactions is to $9,977,043. Gulf + Western now owns 80% of Sega Enterprises. Ltd. The other 20% is owned by Raymond Lemaire.
A few observations. As others have pointed out, the “Service Games” that became Sega was not the same Service Games that was founded in 1945, nor was it the same as Service Games, Japan. OTOH, I don’t know if you can really say it was a “completely different company” either. On paper, that may be true, since Service Games Japan was dissolved when Nihon Goraku Bussan was created. In reality, however, was Nihon Goraku Bussan just Service Games Japan under a new name? They seem to have had the same executives, but I cannot really say if they were different or not, since I am not sure what led them to dissolve the former and create the latter.
I mentioned earlier Steven Kent’s claim that “Service Games began in May 1952,” which I said was “wrong.” In reviewing the information, perhaps “wrong” was a bit strong. He seems to be referring to the Stewart & Lemaire partnership, which did business as Service Games Japan (SGJ). If so, I can see why he would pick that date rather than the founding of Service Games, Hawaii (SGH). He may have been thinking that SGJ is the one that became Sega (though this is not entirely accurate) while SGH did not. I am not sure what the significance of May 1952 was but if SGJ was incorporated on that date then I can see why he makes his claim.
As I said, however, I am not entirely sure that SGJ ever was officially incorporated.
What about the 1951 date? I’m sure where they got that one.
Next time, I’ll talk more about the problems Service Games had with the US government – and boy, did they have them.
Bonus Content
Since someone else made reference to the Polly Bergen Company last time, I thought I’d include this little blurb from my book about the formation of Sega Enterprises, Inc. (the American arm)
“Meanwhile, in 1974, a new corporate entity called Sega Enterprises, Inc. appeared on the scene, though it happened in a roundabout manner that only an accountant could understand. At the time, Gulf + Western, in partnership with David Rosen, was trying to establish a conglomerate in the Far East similar to Gulf + Western, with Sega as a subsidiary. When that effort failed, they decided to spin off Sega into a separate US company headed by Rosen (Kent 2001). One of Gulf + Western’s many holdings was a cosmetics company called the Polly Bergen Company, which they owned a 53.5% interest in via another subsidiary (naturally) called Consolidated Brands. By 1973, Polly Bergen was losing money and in March 1973 Gulf + Western sold its cosmetics business to Faberge, leaving Polly Bergen with no product line whatsoever. In March 1974, Gulf + Western transferred its Sega Enterprises, Ltd. subsidiary to the Polly Bergen Company. Then, on March 25, it effected a one-for-ten reverse stock split and acquired Polly Bergen for 1.7 million shares of stock, increasing its ownership of the company to 95%. The same day, they changed its name from The Polly Bergen Company to Sega Enterprises, Inc. with Sega Enterprises, Ltd. (Sega’s Japanese operations) as a subsidiary (makes perfect sense to me).”
This came from Sega’s annual reports. Despite my comment at the end, I actually suspect that it made perfect sense to somebody. My initial suspicion was that it was done specifically to take control of Polly Bergen by diluting its stock. Since I am not well versed in such matters, however, that was a guess. Wikipedia claims that reverse stock splits are often done to satisfy the stock exchange’s reduce the number of shareholders so that the company is placed in a different regulatory category.
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Please consider researching child sexual abuse or a child abuser in your area or institution. 10 steps to researching child sexual abuse in your area [100]
[100] 2015 May 25 Cathy Fox Blog 10 steps to researching child sexual abuse in your area https://cathyfox.wordpress.com/2015/05/25/researching-child-sexual-abuse-in-your-area-a-rough-guide/
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