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SANFORD – The national leader of Allied Veterans of the World, a group at the center of an Internet casino criminal case, pleaded no contest Friday to operating an illegal lottery in a deal that requires him to serve no jail time and no probation.

Jerry Bass had been charged with more than 200 counts, including racketeering, operating a gambling hall and money laundering for his role in operating 49 local Internet cafes in Florida.

Prosecutors on Friday dropped all but two of the charges. In exchange, the 63-year-old Ocala resident will testify against the state's primary target, group lawyer Kelly Mathis of Jacksonville, and others. Bass will not go to jail and will serve no jail time.

Bass was one of 57 people arrested following a series of raids March 13 in what authorities, including Florida Attorney General Pam Bondi, described as the take-down of a $300 million criminal operation.

Prosecutors allege that Allied's storefronts were little more than gambling houses that used the Internet and key software to transform personal computers into slot machines.

According to a government affidavit, since 2007, when the group went into the Internet cafe business, it grossed $290 million but donated just 2 percent to help veterans, the group's stated mission.

Defense attorney Charles Hobbs insisted Friday that Bass and other Allied Veterans national leaders were intent on helping veterans.

"For years, they believed these enterprises were legal," Hobbs said.

Bass entered his plea, Hobbs said, because he was facing the prospect an eight-week trial and prison.

Most of the 57 people arrested in March are still facing trial. A handful have entered pleas in exchange for no jail time — including Bass' predecessor, 66-year-old Johnny Duncan of Boiling Springs, S.C., who pleaded no contest last week to operating an illegal lottery and money laundering. He's to be placed on probation later.

The most prominent co-defendant still awaiting trial is Mathis, Allied's lawyer. Prosecutors allege he was the architect of the group's Internet café business, as well as its chief litigator and lobbyist and made $6 million from it.

Many of the other defendants still fighting charges are "affiliates," small businesspeople who operated individual cafes.

Their storefronts carried the name "Allied Veterans," but they were high-return for-profit businesses operated by something akin to franchise holders.

Bass and Mathis were among the half-dozen co-defendants in court Friday. So was John Hessong, Allied's national secretary-treasurer from Hilliard, FL, who also cut a deal that carries no jail time. Hobbs, also his attorney, described it as a pretrial intervention program.

Mathis' attorney, Mitch Stone, spent much of Friday arguing that the 207 charges against him, including racketeering, gambling and money laundering, should be dismissed.

Circuit Judge Kenneth Lester Jr. recessed without making a ruling. The hearing is to resume Monday.

Mathis is to stand trial Sept. 16.

He is not a criminal, Stone said, just Allied's lawyer who concluded that under the state's sweepstakes law, the group could legally operate slot-like machines. He then helped it open 49 storefronts around the state and provided ongoing legal service.

Stone said that attorneys at the state agency that enforces the Florida's sweepstakes laws, the Florida Department of Agriculture and Consumer Services, had also concluded in 2007 that the law allowed for them.

He also asked that the trial be moved to Jacksonville, where Mathis practices law and where many of the witnesses live. Circuit Judge Kenneth Lester Jr. said no.

The arrests and scandal surrounding Allied prompted the resignation of Lt. Gov. Jennifer Carroll, whose public relations firm had done work for the group.

Since the arrests, Florida legislators have outlawed Internet casinos.

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