Lip-Service to MONEY LAUNDERING

Speaker: Casino industry can take steps to trace high roller's bankroll

12 June 2014

By Howard Stutz

The head of the federal agency assigned to investigate money laundering crimes told a Las Vegas audience Thursday the casino industry can discover the origins of a high roller’s bankroll in the same way a casino host determines that customer’s favorite wine or music preferences.

Jennifer Shasky Calvery, director of the Financial Crimes Enforcement Network, known as FinCEN, said the casino industry has the same responsibility as traditional financial institutions to police and report any suspicious customer activity, which includes investigating the source of large gambling funds.

During her keynote address at the Bank Secrecy Act Conference at Red Rock Resort, Calvery said the casino industry can employ investigative measures used to determine the social needs and desires of a high-end customer to that same player’s large bankroll.

“Casinos invest heavily in sophisticated monitoring tools to track a wide range of customer activities and to understand their customers’ preferences,” Calvery said. “These same kinds of monitoring and customer service capabilities can and should be leveraged for (anti-money laundering) purposes.”

The gaming industry has come under fire by FinCEN, which is overseen by the U.S. Treasury Department, to comply with anti-money laundering regulations found in the act. Calvery said casinos have the capability and technology needed to investigate the source a gambler’s funds.

The daylong conference was organized by the State Bar of Nevada, but the audience of 500 included more that just attorneys. Casino executives and gaming regulators also listened to the Calvery’s opening remarks. The speech was her second public appearance in Las Vegas since September, when she delivered similar remarks at the Global Gaming Expo.

Casino leaders have worried that subjecting the industry to the same requirements as banks and other financial institutions could keep certain high rollers away from the gaming tables.

“Unfortunately, there is no one-size-fits-all approach to (anti-money laundering laws),” Calvery said.

She also warned the casino operators not to jeopardize their reputations or violate the law in order to “please” a customer.

“A casino’s capability for knowing its customers’ preferences and credit information, combined with your security technology, can and should be leveraged to piece together relevant information to understand your customers’ source of funds,” Calvery said.

The American Gaming Association, which co-sponsored the conference, has held meetings between casino leaders and FinCEN representatives, which Calvery acknowledged during her talk as being “productive.”

AGA President Geoff Freeman introduced Calvery and said after the talk that her remarks “were a big step forward” from the comments she made at G2E.

He said FinCEN is developing a “clearer understanding” of how the industry operates. The interaction with the gaming leaders, Freeman said, has been helpful to both sides.

“One senior-level casino official said to me today a single customer is not worth our license,” Freeman said.

Calvery said in September the industry was being watched.

In August, Las Vegas Sands Corp., struck a deal with federal prosecutors and paid a $47.4 million settlement to avoid criminal charges in connection with a 2006 and 2007 investigation into money laundering by a customer at The Venetian.

Caesars Entertainment Corp. disclosed in October that Caesars Palace was being investigated for possible money laundering allegations.

Calvery said Thursday casinos weren’t “simple cash-intensive businesses.” She called casinos “complex financial institutions” that extend credit and conduct financial transactions worth millions of dollars every day.

“Casinos must continue their progress in thinking more like other financial institutions to identify (anti-money laundering risks),” Calvery said.

Under the Bank Secrecy Act, casinos are required to report currency transactions by any person of more than $10,000 in cash each day. In addition, casinos are required to report suspicious customer activity when it comes to those financial transactions.

She said the buying and cashing in of chips by customers are not always simple transactions.

“While the vast majority of these transactions are purely for entertainment purposes, casinos can serve as the vehicle for the use, movement, and concealment of ill-gotten gains,” Calvery said.

“This is a risk inherent in all financial institutions.”


http://www.casinocitytimes.com/article/speaker-casino-industry-can-take-steps-to-trace-high-rollers-bankroll-63315

Gasping for air because of MARKET SATURATION?

Regardless of how much they suck out of you, they're never satisfied!

Las Vegas Turns Away From Gambling to Lure Holiday Tourists

Gambling town uses exhibits and Christmas classics to draw families

By Associated Press | December 26, 2013

 

LAS VEGAS—Las Vegas has mostly shelved its attempt to rebrand itself as a family-friendly wonderland. But there’s one exception: the dreaded holiday season, when visitor numbers crater and room vacancies soar.

In an attempt to lure tourists, Las Vegas casinos are staging increasingly elaborate holiday events.

The Bellagio has again transformed its conservatory into a faux winter wonderland featuring a 42-foot-tall Christmas tree, a life-sized candy house, a walk-through snow globe, and topiary polar bears, all a few paces from the gambling floor.

The casino’s famous dancing water fountains are leaping to Christmas classics, and tourists are taking photos with a 250-pound chocolate Grinch.

The Forum Shops at Caesars Palace is showing its Christmas cheer with “Elf Aquarists,” divers in elf-style wet suits who feed the aquarium’s tropical fish during daily shows.

Perhaps the most elaborate of all the exhibits is “Winter in Venice” at the Venetian, which the casino advertises as a public gift in banners strung outside its ersatz Italian facade.

Slow December

December is traditionally the slowest month in Las Vegas. Last year, tourist volume fell from a high of 3.53 million visitors in March to a low of 3 million visitors in December, according to the Las Vegas Convention and Visitors Authority. November and January didn’t look much better.

Keith Salwoski, spokesman for the Venetian and Palazzo hotel-casinos, said the winter extravaganza, now in its third year, has helped convince families to seriously consider a holiday vacation to Sin City.

“Every photo that is shared during the holidays, for instance, helps to change the perception of the destination for the Christmas traveler. Suddenly, spending Christmas in Vegas is on the radar of travelers,” he said.

Beautifully costumed actors stroll around the casino halls, greeting children and posing for silly photos with adults. Outside, a 65-foot Christmas tree made of lights shines like a beacon, tempting pedestrians to come inside.

European Flair

Helen and Bob Harrison spent a recent afternoon gazing at a cluster of white birds and poinsettias arranged in front of an indoor waterfall near a bank of slot machines at the Venetian. The Wichita, Kan., couple was celebrating their 60th wedding anniversary and had decided to spend the week visiting all of the Strip’s Christmas exhibits.

“I used to work in a flower shop, and I just love this. The design that goes into it—we don’t have anything like that in our city,” Helen Harrison said. “It’s nice to not have to go to Europe to see all this stuff; it saves on travel.”

The Cosmopolitan Las Vegas, a few blocks over, has doubled the size of its rooftop skating rink this year. Chief marketing officer Lisa Marchese said the casino is going for a “ski lodge perched over the Las Vegas Strip” aesthetic. Skaters can huddle around fire pits and buy s’more kits for $14 (it’s still the Strip, after all).

The rink at the Cosmopolitan is just one of several designed to entice desert visitors to casino properties. Caesars Palace, the Venetian, and the Gold Spike are among those offering skaters an opportunity to lace up their boots for ice, real or artificial.

While most Las Vegas spectacles are designed to dazzle and erase the memory of home—with all its constraining social mores—the Christmas installations aim to remind tourists of their childhood.
“It’s nostalgic,” Marchese said. “I don’t care where you grew up, I think everyone romanticizes the notion of skating in the winter.”

Read more: http://www.theepochtimes.com/n3/417639-las-vegas-turns-away-from-gambling-to-lure-holiday-tourists-2/#?photo=2&_suid=13881874033040027426529936167232#ixzz2oinNEx4P

Caesars casino owners in hot water with IRS

By Josh Kosman

October 30, 2013 | 11:49pm

 

Atlantic City, NJ

Photo: Christopher Sadowski

 

Private-equity giants Leon Black and David Bonderman may be holding a losing hand at Caesars Entertainment.

The company, America’s largest casino chain, owned by the investors’ PE firms, has revealed that it is the subject of a money-laundering probe by the IRS.

News of the tax agency investigation comes days after Caesars revealed federal and state regulations have drawn a bead on its Las Vegas casino for possible violation of the Bank Secrecy Act and after state regulators in Massachusetts rejected the company’s application for a casino license in the Bay State.

Caesars shares have fallen 22 percent since Oct. 14. They closed Wednesday at $17.40, down 5.4 percent.

Black’s Apollo Management and Bonderman’s TPG Capital teamed on buying Caesars in a highly leveraged $30 billion 2008 buyout.

Before the recent problems, Caesars — the biggest casino operator in Atlantic City — was already losing money and on track to run out of cash in mid-2015.

Josh Kosman

http://nypost.com/2013/10/30/caesars-casino-owners-in-hot-water-with-irs/?source=email_rt_mc_body&app=n

More Feds probing Caesars Entertainment • 7:17 AM

• Caesars Entertainment (CZR) discloses it is the subject of a money-laundering investigation by the IRS.
• Earlier in the month, the company revealed a grand jury investigation into the same issue relating to actions at Caesars Palace in Las Vegas.

Read comments

Caesars' Hiccups SEC Filing

• Caesars Entertainment (CZR -4.8%) discloses that a grand jury is investigation possible violations of the Bank Secrecy Act at Caesars Palace in Las Vegas.
• The company could face penalties or an enforcement action depending upon the findings of the probe.
• SEC Form 8-K
• Previous: Caesars pulls out of Massachusetts casino project.

Read comments

Posted October 21, 2013 - 8:19am Updated October 21, 2013 - 4:50pm

Caesars Palace under investigation for possible money laundering

Caesars Entertainment Corp. says the U.S. Treasury Department is investigating money-laundering allegations at Caesars Palace. (Las Vegas Review-Journal file)

By HOWARD STUTZ
LAS VEGAS REVIEW-JOURNAL

Caesars Entertainment Corp. said Monday the U.S. Treasury Department is investigating potential money-laundering allegations at Caesars Palace.

In a filing with the Securities and Exchange Commission, Caesars said it received a letter from the Treasury Department’s Financial Crimes Enforcement Network earlier this month, alleging violations of the Bank Secrecy Act.

The division, known as FinCen, is determining “whether it is appropriate to assess a civil penalty and/or take additional enforcement action against Caesars Palace.”

Caesars said it would cooperate with a federal grand jury investigation into the matter and the FinCen probe.

“Based on proceedings to date, the Registrant is currently unable to determine the probability of the outcome of these matters or the range of reasonably possible loss, if any,” Caesars said in the filing.
Gaming Control Board Chairman A.G. Burnett said Monday state agents have been working with
FinCen on the investigation, but it was early in the process. Burnett said said he couldn’t reveal any specifics of the investigation, including the time frame or the nature of the allegations.

“The board has been working closely with FinCen,” Burnett said. “We have a good working relationship with them.”

In August, Las Vegas Sands Corp. struck a deal with federal prosecutors and paid a settlement of $47.4 million to avoid criminal charges in connection with allegation of money laundering activities at The Venetian in 2006 and 2007.

In the filing, Caesars said, “Governmental authorities have been increasingly focused on anti-money laundering policies and procedures, with a particular focus on the gaming industry.”

The FinCen investigation was revealed in the same SEC filing in which Caesars explained reasons the company withdrew late Friday from the process to earn a Massachusetts gaming license. In addition, Caesars said it is severing a deal with the Gansevoort Hotel Group in the $185 million redevelopment of Bill’s Gamblin’ Hall.

Massachusetts gaming investigators, during routine background checks of Caesars’ business partners, took issue with an investor in New York-based Gansevoort.

The investor, a German businessman, is reputed to have ties to organized crime in Russia.
Gansevoort is not involved in the Boston venture and was not expected to seek licensing by Nevada gaming regulators for the Strip project. The deal between Caesars and Gansevoort was strictly a licensing and marketing agreement.

Burnett said state gaming agents will review the Massachusetts investigative report and meet with regulators to understand why the Suffolk Downs Race Track, Caesars’ partner in the proposed $1 billion hotel-casino complex in Boston, was asked to remove the Las Vegas-based company from the project.

Burnett said Gansevoort’s background would have been looked at by the compliance committee of Caesars Entertainment. All gaming companies in Nevada have compliance committees, which are normally made up of former regulators and law enforcement officials, who check out potential business partners.

“My understanding is the compliance committee for Caesars investigated the partnership,” Burnett said. “We will talk with the compliance committee as we look further into this matter.”

Burnett said it’s doubtful the board would have investigated Gansevoort because “it was was up to the Caesars compliance committee to handle the due diligence.”

In a statement Sunday, Caesars Entertainment Executive Vice President Jan Jones said ending the Gansevoort relationship would “have no impact on the transformation of Bill’s” into a luxury boutique hotel-casino. Jones said the rooftop pool area and nightclub from Victor Drai and a restaurant operated by television cooking personality Giada De Laurentiis were still part of the project.

In its SEC filing, Caesars said Massachusetts regulators also had concerns about the company’s financial suitability and with Caesars Interactive Gaming CEO Mitch Garber’s employment with European-based Internet gaming companies accepted wagers from Americans before passage of the 2006 Unlawful Internet Gambling Enforcement Act.

The company carries a gaming industry-high $23.5 billion of debt and Garber, who is also CEO of the newly formed subsidiary, Caesars Acquisition Co., was licensed in Nevada earlier this year.

The events surrounding Caesars unfolded over the weekend.

Investors sent shares of Caesars, traded on the New York Stock Exchange, down as much as 9 percent early Monday. The stock closed at $17.81, down 89 cents, or 4.76 percent.

Union Gaming Group Managing Director Bill Lerner told investors Caesars, which operate 54 casinos in 13 states, could have trouble in seeking licensing in other markets.

“That said, while respective states and jurisdictions are independent from a regulatory standpoint, we note Caesars has existing and longstanding approvals throughout domestic gaming markets,” Lerner said.

Caesars had a 4 percent stake in Suffolk Downs and would have managed the property. In Las Vegas the company will need to find a branding solution for the Bill’s casino.

http://www.reviewjournal.com/business/caesars-palace-under-investigation-possible-money-laundering




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Vegas: Ignoring Patrons Safety

In Vegas, eye in the sky guards money, not guests

By HANNAH DREIER, Associated Press | October 7, 2013 | Updated: October 8, 2013

• 

Photo By Jae C. Hong

1 of 1

FILE - In this file photo taken Wednesday, Nov. 14, 2007, guests descend an escalator to the main casino floor of the Planet Hollywood Resort & Casino in Las Vegas. While casinos have thousands of cameras watching the gaming floors, entrances and some elevators, cameras are absent in the hallways of the guest room floors where thousands of crimes occur.

 

LAS VEGAS (AP) — Hotel maid Brandi Patrick was chased down the hallway at the Flamingo casino last year by a nearly naked man. She said she had to lock herself in a cleaning closet and, as the man rattled the handle, fumble around in her pockets to find her cellphone so she could call security.

 

She said she's haunted by the thought of what might have happened if she hadn't had her phone. "Something could happen and no one would know it 'till the end of the shift," she said.

 

Las Vegas casinos— some of the most closely-watched spaces in the world— don't have video cameras in guest room hallways, an absence that hotel workers like Patrick, patrons and prosecutors say can act as a green light for crime.

 

Casino bosses say there is no need for extra security: America's playground boasts more cameras per square foot than any airport or sports arena in the country, with thousands of high-tech lenses watching the gambling floors, lobbies and elevators.

 

All four major Strip casino operators, however, declined further comment.

 

Closed circuit cameras hidden behind plastic ceiling domes are omnipresent in pop culture portrayals of Sin City. They play a pivotal role during the heist in 2001's "Ocean's Eleven" and in the reconstruction of a crazy night in the 2009 buddy comedy "The Hangover."

 

Yet the Associated Press found that 23 of the 27 major Strip casinos have no surveillance in hotel hallways or elevator landings. All but four of the 27 hotels are owned by MGM Resorts International, Caesars Entertainment Corp., Las Vegas Sands Corp. or Wynn Resorts Ltd.

 

The AP arrived at the tally by interviewing casino officials and visiting the hotels that wouldn't comment. Only Caesars Palace, Planet Hollywood, the MGM Grand and Tropicana Las Vegas monitor the halls above the gambling floor.

 

"People have a false sense of safety when they go to a casino," security consultant Fred Del Marva said. "You think, 'I'm going to Bellagio, they have 2,000 surveillance cameras, so I'm going to be safe.' And you're wrong. The level of security at the hotel level is zero."

 

Tourist Allyson Rainey said she wishes she'd known no one was monitoring the hallways of Harrah's hotel-casino before her computer was stolen from her room last year. A police detective caught the thief after spotting him clutching her distinctive laptop bag in hotel lobby footage.

 

But Rainey said more cameras at the Caesars-owned hotel could have prevented the crime.

 

"The detective told us that the guy had a keycard made, and he was going from hotel to hotel," she said. "He had been doing this for the last eight years, so he obviously knew they didn't have cameras there."

 

Gary Selesner, president of Harrah's and Caesars Palace, said cameras cannot stand in for vigilance when it comes to preventing "door-push" crimes, or crimes in which a burglar finds a room to target by pushing on doors until one swings open.

 

"As a hotel operator, I think what you really need is cameras in foyer and in the elevator. That said, we are putting cameras in as we complete renovations because of door-push concerns," he said. The company has installed cameras in at least one tower of Caesars Palace.

 

Hotel room burglaries account for the great majority of casino crimes, and they've been on the rise in recent years, while burglaries have declined in the rest of the city, according to an analysis of police statistics.

 

Las Vegas Chief Deputy District Attorney James Sweetin said the absence of cameras not only encourages petty crimes such as burglary but makes more serious crimes harder to prosecute.

 

He wondered whether stepped up surveillance might have prevented the rape of a 13-year-old boy in a hotel room at MGM's Circus Circus last New Year's Eve, or the assault of an unconscious woman at the Cosmopolitan. He said the woman's assailant avoided cameras by taking the stairs.

 

Housekeepers have their own scare stories. Patrick said she never reported her brush with the man in the hallway to police or her managers. Hotel officials said they would have conducted an investigation had the incident been reported.

 

Other hotel maids can recall similar scares, though they too say they don't report them.

 

In 2011, a 65-year-old maid was punched in the face, pushed into an empty guest room and raped at Bally's casino. Again, the assailant used the stairs. A man has been charged in the case, which is ongoing.

 

The main obstacle to increased hallway security is cost, experts say.

 

A midsized hotel might pay $2 million to install the system and $100,000 a year to monitor it, according to Art Steele, who directed security at the Stratosphere Las Vegas from 1996 to 2009. The casino, located between the Strip and downtown, is one of the few to place cameras in its hallways. Steele said they helped every day.

 

The other concern is lawsuits. If casinos set up hallway cameras but ignored the footage, guests might

sue for negligence, according to Les Gold, who litigates liability issues for Mitchell Silberberg & Knupp in New York City.

 

"When they put these cameras in, it deters crime," he said. "But to have a camera that is not monitored is a huge mistake."

 

http://www.chron.com/news/crime/article/In-Vegas-eye-in-the-sky-guards-money-not-guests-4877118.php

 

 

Nevada's "Markers Law"

September 10, 2013 

Gambler's challenge to 'markers' law disputes $384,000 casino debt

 

By ED VOGEL
LAS VEGAS REVIEW-JOURNAL

RENO — If you are going to play, then you have to pay.

That was the clear message that Chief Clark County District Attorney Bernard Zadrowski gave Tuesday to gamblers, lawyers, Nevada justices and about 1,000 students in the Reno High School gym.

He argued for the constitutionality of the state’s “markers law” that requires gamblers to pay their debts when requested, or face civil and criminal penalties.

He also asked the Supreme Court to uphold the lower court conviction of Harel Zahavi, a Middle Eastern baccarat player who failed to pay off a combined $384,000 in markers he took from the Hard Rock, Caesars Palace, The Venetian and Palazzo in the fall of 2008.

While the Supreme Court is not expected to make a decision for several months, the case has major implications for the entire gaming industry, which regularly issues markers to major players.

“Why did your client accept markers if he didn’t have the money to pay it back?” asked Justice Mark Gibbons at one point in the half-hour argument.

Zahavi’s court-appointed attorney, Matt Lay, argued that his client generally gambled “small amounts” and had a history of being “slow to pay,” but the casinos had access to his bank accounts and never should have issued him more credit.

The court record showed Zahavi paid off $700,000 in debts to casinos by selling off property in September 2008. Lay said the casino, knew, or should have known, he did not have money in his bank account shortly after he made these payments and yet they still issued him markers.

Zahavi, who was not present at Tuesday’s oral arguments, was convicted of four counts of passing checks without sufficient funds with the attempt to defraud in 2011. He received 12-month to 34-month prison sentences on each count, but all were suspended and he was placed on probation.

Zadrowski said casinos first check players’ bank accounts and determine their average balances in recent months before they give them credit.

But the marker, similar to a check, can be cashed by the casino at any agreed upon time. usually 30 days or less. The casino “has no affirmative duty to alert” the gambler that his account lacks funds before cashing the check, according to Zadrowski.

When you agree to take a marker, under state law you are agreeing you have sufficient funds now to pay the check, he said.

Lay pointed out that the Hard Rock checked and found Zahavi had $27,000 in his bank account, but it still issued him $100,000 in markers. Other casinos had not checked his bank accounts for two months at the time they gave him more credit, he added.

Because of this knowledge and their failure to stop Zahavi from playing, Lay argued that he could not be convicted of criminal fraud.

But Zadrowski argued that the state law permits the casinos to consider more than bank account records before issuing players permission to use markers. Their property ownership interests and any lines of credit they mighty have are considered. Typically big gamblers have several bank accounts and lines of credit, he said. Zahavi also has been gambling in Las Vegas for 10 years.

The hearing at Reno High School was not unusual. The Supreme Court occasionally holds oral arguments in schools around the state to show students how the court operates.

Reno students fidgeted around during the first hearing, a contested will case. They were mostly attentive during the marker case. Poor acoustics made it difficult for everyone to hear, even those close to the court and the lawyers.

Chief Justice Kris Pickering, a Reno High graduate, allowed students to ask questions of the lawyers following the oral arguments.

One student asked why casinos would continue to issue more credit even if they knew the player did not have sufficient funds.

“Your guess is good as mine,” Lay responded. “It depends on how desperate casinos are for money.”
Zadrowski responded: “It’s a business decision by the casino.”

http://www.reviewjournal.com/business/casinos-gaming/gamblers-challenge-markers-law-disputes-384000-casino-debt

 

Caesars: a pattern of abuse

Nevada fines Caesars for 'pattern' of underage gambling

Caesars Entertainment Corp. agreed to pay the state of Nevada a $100,000 fine to settle underage gambling charges. (Damian Dovarganes / Associated Press) By John M. Glionna July 27, 2012, 12:43 p.m. LAS VEGAS – This tourist city has for years prided itself as a destination for the entire family – from Daddy and Mommy on down to little Junior. But Caesars seems to have taken the concept a bit too far. It was busted this week for what many might consider the unthinkable: kids on the casino floor – gasp! – placing bets.   This week, the Caesars Entertainment Corp. agreed to pay the state of Nevada a $100,000 fine to settle underage gambling charges, and the state’s Gaming Control Board warns that the outfit may face a stiffer penalty if any hanky-panky poker or slot machine incidents happen again.   “This is not an isolated incident, but a pattern of abuse,” Nevada Gaming Commissioner Randolph Townsend said Thursday as the regulatory panel voted to accept the settlement with Caesars over multiple charges of gambling and alcohol consumption by underage customers at several of the company's resorts on the Strip between 2010 and May of this year.     He warned that the casino was getting off easy. This time. Board members say a paltry $100,000 is certainly not enough to send a message to the fantastically wealthy industry. But the settlement, negotiated by Nevada Deputy Atty. Gen. John Michela, was based on history and precedent.   "If it happens again, I want a seven-figure settlement or else we will litigate it," Townsend said. "As we enter the Internet gaming world, this becomes a significant issue."   It is against the law for anyone under the age of 21 to partake in any kind of gaming in Las Vegas. In fact, anyone under that age is forbidden from loitering on the casino floor.   Caesars Entertainment spokesman Gary Thompson told reporters that the company "has been recognized as a leader in responsible gaming" and is "committed to its programs, including Project 21, which addresses underage gambling." [When Harrah's, now Caesars, determined that 90% of their profits originated from 10% of their patrons, they targeted, comped and pursued them. That's Gambling Addiction. Nothing 'RESPONSIBLE' HERE.] Under terms of the July 9 settlement, Caesars agreed to pay the $100,000 fine and admitted to all violations in the complaint. The company has 60 days to report how it has addressed the issues.   Investigators say employees of Caesars Palace, Harrah's Las Vegas, Rio and Flamingo allowed customers between the ages of 17 and 20 to play table games at the properties even though dealers were presented identification showing gamblers were under the age of 21. In May, a dealer at Caesar's Palace reportedly misread the passport of a 19-year-old and allowed him to play blackjack.   Also in May, Bobbi Kristina Brown, the 19-year-old daughter of the late Whitney Houston, was caught on camera gambling in Las Vegas – playing slots with her 22-year-old boyfriend, Nick Gordon.   In 2007, an underage Las Vegas man tried to recoup his $600 loss at the Venetian by telling hotel officials he wasn't old enough to gamble legally. He was later prosecuted on misdemeanor charges. http://www.latimes.com/news/nation/nationnow/la-na-nn-nevada-gaming-board-kiddie-gamblers-vegas-20120727,0,4816718.story

Former Caesars Palace Nightclub Owner, Head Doorman Plead Guilty to Tax Crimes

USDOJ: Former Caesars Palace Nightclub Owner, Head Doorman Plead Guilty to Tax Crimes

Steve Davidovici, formerly a part-owner and manager of the Pure Nightclub located within the Caesars Palace Hotel and Casino in Las Vegas pleaded guilty in federal court to one count of filing a false federal income tax return for the 2006 tax year, the Justice Department and Internal Revenue Service, Criminal Investigation (IRS-CI) announced today. The Justice Department and IRS-CI also announced that Mikel Hasen, the former head doorman at the Pure Nightclub, likewise pleaded guilty to one count of filing a false federal income tax return for the 2006 tax year. United States District Court Judge Kent Dawson presided over both plea hearings.

According to information disclosed at the plea hearings, during the years 2005, 2006 and 2007, in addition to fees charged for admission to the nightclub, some of Pure’s patrons made cash payments to Pure door personnel and “VIP hosts” to bypass the general admissions line and to obtain more desirable seating. This money was collected, pooled and generally distributed on a weekly basis to the door personnel and VIP hosts, as well as to managers of Pure such as Davidovici and Hasen. In Hasen’s case, distributions from this “tip pool” comprised the bulk of his compensation during the time he worked at Pure. Davidovici and Hasen each concealed large amounts of this income from the IRS.

Davidovici’s and Hasen’s sentencings are set for June 27, 2012, at 9 AM

“With the April 15 tax deadline looming, it is important for people to have confidence that when they pay their taxes, their neighbors and competitors will do the same,” said Paul Camacho, Special Agent in Charge of the IRS-Criminal Investigation, Las Vegas Field Office.

Two VIP hosts under Davidovici’s supervision, Ali (Sean) Olyaie and Richard Chu, have also pleaded guilty to tax crimes for failing to report income earned at Pure. At their respective plea hearings, Olyaie and Chu likewise admitted filing false federal income tax returns for 2006. Olyaie and Chu are also awaiting sentencing.

This case is being investigated by IRS Criminal Investigation and is being prosecuted by Tax Division Trial Attorneys Christopher J. Maietta and Joseph A. Rillotta.

More information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax/.

A piece of heaven turned to hell

A piece of heaven turned to hell
Kate Allen
Staff Reporter

Very slowly, the sisters approach the building that has caused their financial ruin.

Joyce Williams, 70, and Pat McLaughlin, 63, have come in Williams’ rusting minivan. They peer into the windows of their former church in Scarborough, where the gold satin drapes still hang askew.

“Puts a knot in your stomach,” says Williams.

Later, McLaughlin clutches her sister’s hand at a Tim Hortons down the road as Williams recounts their ordeal, her eyes brimming with tears. The saga began with a pastor they trusted too much, turned south with a real estate investor who owes tens of millions to casinos, and now rests in the hands of a man who claims he could bankrupt them at any moment.

Because of what they invested in a church they thought would help others, the sisters, their children and other parishioners are in danger of losing their own homes.

The pastor, Hilary Salmon, denies any wrongdoing, claiming her parishioners collectively agreed to pursue church group’s vision. The real estate investor, Semion Kronenfeld, says he’s not responsible for his gambling debts.

Broke and lawyerless, the sisters cling to their Christian faith, and their bond with each other. “That will never shake,” says Williams.

What turned hellish at first looked like a golden opportunity. In 2007, Salmon, the pastor of Greater Works Ministry, a Pentecostal congregation that was renting service space, approached Williams and McLaughlin with a vision: she wanted to buy a church. Salmon is also a licensed real estate agent.

Though the sisters did not attend her church, Salmon had been extremely close to Williams’ and McLaughlin’s mother, Daphne, before Daphne died 10 years ago. Many mornings since then, Salmon joined the two sisters in prayer over the phone.

So when Salmon presented the idea of a community that would include youth outreach — a pet cause of McLaughlin’s — along with a daycare centre, a restaurant and space for Sunday services, the sisters were enthusiastic.

Then Salmon asked the sisters to help out financially. Williams is a retired nurse living off her pension. McLaughlin is a house cleaner. They balked at first. “Oh my god, I don’t have any money!” McLaughlin remembers telling Williams.

But eventually, both relented — a decision they now call “foolish.” They assumed they would be paid back in due course.

“We thought we could be of service, or help, to others,” says Williams. “But now, in retrospect, we think: how did we get here?” Williams remortgaged her Scarborough house, and the sisters tapped lines of credit, credit cards and an accident insurance payout to lend $50,000.

Another parishioner, June Douglas, says Salmon asked her to borrow $100,000 for the church: “She called me to tell me what the Lord is doing, and asked if I could help,” says Douglas, 47.

Douglas is a single mother of four who had quit her job because her dementia-stricken mother needed full-time care. Though Douglas was already borrowing $30,000 to put her mom in a nursing home, she eventually gave Salmon what she wanted.

“She just kept pulling — it’s like a magnet,” says Douglas. Salmon said she would provide the monthly payments for both loans.

Salmon did not answer questions posed to her by the Star, responding only that the allegations presented in this story are “falsified.” Previously, in response to a lawsuit brought by Douglas, she said that she, too, suffered financially after borrowing more than $100,000 to finance the church. She also said that she did not call Douglas to ask for a loan, and that the loan was “voluntary.”

The parishioners’ money was plunged into the down payment on their church-to-be, a huge, one-storey strip of brick at 430 Tapscott Rd. in Scarborough.

Since 2006, the property had belonged to AJGL Developments, a North York-based real estate development company. The president of AJGL, Semion Kronenfeld, was a man of extravagant tastes.

Kronenfeld lived in a gated, nine-bedroom, $4-million dollar mansion in North York with a driveway big enough to park his small fleet of luxury cars: a Rolls-Royce Phantom, a Ferrari Spider and two S-Class Mercedes-Benzes, among others. He was also part owner of two condominiums.

According to one casino executive, Kronenfeld, 40, wore white Louis Vuitton shoes, collected expensive watches and liked to smoke cigars.

Blackjack was his game of choice. Says Vincent Salvatore, an occasional business associate and acquaintance of Kronenfeld: “He was a whale. He was a big gambler.”

Kronenfeld was selling the 46,000-square-foot Tapscott property for $3.7 million.

The ministry was given a conventional mortgage, but it covered only $2.3 million of the purchase price. So Kronenfeld offered a vendor take-back mortgage, a type of private loan offered by the seller of a property to the buyer.

There was one condition: Kronenfeld would only provide a $1.25 million mortgage if the group offered five properties as collateral. Under pressure from Salmon, Williams and McLaughlin say, they both agreed to include theirs. Their children (both have two sons), who own the homes on paper, agreed to the deal.

After resisting, Douglas caved and agreed to add hers last-minute — she says Salmon told her church members could lose all the money they had already invested. Another couple who knows Salmon agreed as well. Salmon herself put up one of her properties, in Markham. She owns another on tony Balliol St. in downtown Toronto.

The mortgage didn’t seem risky because of one crucial detail. As a condition of the sale, Kronenfeld guaranteed Greater Works Ministry a five-year lease for an appliance business that was renting half of the building, an arrangement that would supply the church with thousands of dollars in income.

So, every month, when the ministry wrote Kronenfeld a cheque for $10,417 in mortgage payments, it would receive more than $15,000 in rent payments. The ministry could put the extra money towards its mortgage payments to the bank.

However, the balances on both mortgages were due in a year, not uncommon in commercial real estate. How Salmon planned to come up with the money by then is unclear.

The deal closed on Aug. 8, 2008, with Salmon acting as the agent for the ministry. Salmon’s former brokerage, ReMax Crossroads Realty, confirmed that she received a commission of $74,000 on the sale. (She was terminated from the brokerage last month for lagging sales, the branch manager said.)

That very same day, according to legal documents, Kronenfeld went to Casino Niagara and Niagara Fallsview Casino and took out a $1 million line of credit.

The ministry moved in and, for a few months, the community grew. The sisters attended prayer meetings, breakfasts and services. Williams and McLaughlin say Salmon asked for more money to renovate the space. They loaned another $50,000.

Then suddenly, in the fall of 2008, the rent cheques stopped appearing. Salmon called a meeting to say that the appliance business had moved out. Without the extra income, the church group began struggling to make their monthly mortgage payments.

What no one knew was that in a matter of months, Kronenfeld had racked up millions of dollars in betting debts while living the life of a high roller.

According to charging documents in the U.S., bankruptcy files in Ontario and lawsuits filed by casinos, between August and November of that year Kronenfeld jetted across North America, allegedly piling up debts at a different casino nearly every weekend.

Kronenfeld’s lawyer, Stanley Rosenfarb, told the Star that neither he nor his client was interested in commenting for this story. In statements of defence to the casinos’ lawsuits, Kronenfeld denied responsibility for the debts, in part because he claims the casinos did not advise him to obtain legal advice when he entered into credit arrangements.

The same week that the Tapscott deal closed, Kronenfeld took out the $1 million line of credit in Niagara Falls plus another $1 million line of credit at Casino Rama.

In September, he was in Las Vegas, where he lost $1.2 million at the MGM Grand and $700,000 at Caesars Palace.

In October, Kronenfeld gambled $5 million over two days at the Trump Taj Mahal in Atlantic City. Kronenfeld claims he was induced to gamble because casino executives lavished him with limousines, private jets and a diamond watch for his wife (the casino denies this). Later that month, he was in Las Vegas again, gambling away $7.9 million at the Venetian and another $5 million at the Green Valley Ranch casino.

In November, he lost $2.1 million at the Niagara casinos and Casino Rama.

By the New Year, his lifestyle was crumbling. Casinos were after him for $21 million.

The Taj Mahal, the MGM Grand, Casino Rama and the Ontario Lottery and Gaming Corp., which operates the Niagara casinos, were all suing him, claiming he failed to repay his debts. A warrant for his arrest was issued in Nevada after two Las Vegas casinos brought cheque fraud charges against him.

His bank, RBC, also sued him and froze his account after he allegedly deposited two cheques in December 2008 worth $1.1 million and immediately wired the money to a Swiss bank account before the cheques bounced. In his statement of defence, Kronenfeld states he was just as shocked as the bank when the cheques were dishonoured. He denies he defrauded RBC.

In February 2009, Kronenfeld filed for bankruptcy. His list of creditors includes, besides the casinos and RBC, vehicle leasing companies for eight different cars, $7,000 at Best Buy and hundreds of thousands in credit card debt. His nine-bedroom mansion and two condominiums were sold off. He claims that he and his wife separated and he moved in with his sister — although, in an unrelated lawsuit, Kronenfeld states that nine months after his bankruptcy filing he and his wife were living in a rented five-bedroom mansion when it caught fire and burned down. The owners of the house are suing the couple for $3 million; Kronenfeld and his wife deny responsibility.

The church group, meanwhile, fell into default on their mortgage, and the situation quickly deteriorated. In early 2010, Salmon reneged on her promise and stopped paying for the $100,000 loan Douglas had taken out for the church. The Tapscott property was seized by the bank and sold, which paid off only the first, conventional mortgage. In June, the church members were mailed warning letters noting that they were in default on the second mortgage, and that power of sale proceedings would be issued on their homes imminently.

But the letters came from a company they had never seen before: Vincorp Financial.

Unbeknownst to the church group, in November 2008 Kronenfeld sold the second mortgage on 430 Tapscott Rd. to a company called Vincorp Financial.

Vincorp’s president is Vincent Salvatore, Kronenfeld’s business associate. Salvatore told the Star they had also been on gambling trips together.

On the same day that the Taj Mahal sued Kronenfeld for $5 million, the casino also filed a complaint against Salvatore, claiming $3.5 million in unpaid gambling debts. In his statement of defence, Salvatore says he was at the casino on a trip arranged by Kronenfeld, and those millions were actually gambled by his friend, who is therefore liable for the debts.

Salvatore says he bought the Tapscott mortgage from Kronenfeld for $1.3 million. “I guess he needed the money,” Salvatore says.

Salvatore, 62, told the Star their relationship soured after Kronenfeld went belly up. “Kronenfeld screwed me too,” says Salvatore. According to records, when Kronenfeld declared bankruptcy, he owed $100,000 to a company called Salvatore Empire Investments, whose president is Salvatore’s wife.

The fate of McLaughlin, Williams, Douglas and the other church members is in Salvatore’s hands, he says: “Right now I actually can bankrupt them.” But he notes that he paid $1.3 million for the Tapscott mortgage. As it stands, if he collects on all five homes tomorrow, he still won’t make that back, because the equity in the properties is probably around $400,000.

“I really feel bad for the people. That was my main concern right from day one. People like them should not lose their houses,” Salvatore says. But, he adds, “I can’t walk away from a million three (thousand dollars) . . . that money is my family’s money.” Salvatore says he is open to negotiating a new payment plan.

“Who created the problem was Hilary (Salmon) . . . by getting into a deal that was too big for her,” he says.

“I trusted her, we all trusted her,” says Douglas. “It almost destroyed me.” For more than a year now — since Salmon abandoned her promises of repayment — Douglas has been forced to use her mother’s monthly pension cheques to pay down ballooning interest on the $100,000 loan. She can’t afford to put her mother in a nursing home anymore.

Douglas filed a lawsuit against Salmon but later dropped it when she, Williams and McLaughlin retained a lawyer, hoping to bring a larger lawsuit against their former pastor. But the group abandoned that plan when the legal bills became too much for them. They would like to pursue further legal avenues, but their finances won’t allow it.

The sisters both say that Salmon had good intentions. But Williams adds: “I really trusted her that everything was going to be okay, and she knew what she was doing. But when I look back at it, the fact that she’s a leader . . . to bring us through this, that was the hardest part.”

The knock at their doors could come any day.

“We’re just trusting God,” says Williams.


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VIDEO: Church deal goes wrong for sisters


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Cast of Characters

Semion Kronenfeld

• Born in Soviet Union, raised in Israel and moved to Canada as a teen, according to bankruptcy documents.

• Married, 40-year-old father of four, including two from previous marriage.

• Established successful investment real estate business and lived a lifestyle to match, with nine-bedroom mansion, part ownership of two condominiums and fleet of luxury cars.

• Former president of AJGL Developments, and was the president of Electronic Liquidators, which declared bankruptcy in 2008. He is listed as an “incorporator” of the numbered company that rented the appliance business space at 430 Tapscott Rd., and which also shares the same address as AJGL Developments.

• Declared personal bankruptcy in February 2009, blaming the global recession. He also claims his gambling debts — more than $21 million, according Kronenfeld’s list of creditors — were brought on due to “extravagant and constant incentives” provided by casinos.

• Bankruptcy documents include testimony from two addiction counsellors he has visited since 2010. But according to one, Dr. Albert de Goias, Kronenfeld “did not have a gambling addiction. He had a lifestyle addiction.” Kronenfeld has signed up for the Ontario Lottery and Gaming Corp.’s self-exclusion list.

Hilary Salmon

• Pastor of Greater Works Ministry, a Pentecostal congregation, and also a licensed real estate agent.

• In 2008, led a group including Joyce Williams, Pat McLaughlin and June Douglas to purchase 430 Tapscott Rd. for the purpose of establishing a church.

• Says she borrowed $100,000 off the value of her home to finance the church. She also collected a $74,000 commission on the purchase of 430 Tapscott Rd, according to her former brokerage.

• Owns two houses, one of which is collateral for the $1.25-million mortgage the group took out with Kronenfeld.

Vincent Salvatore

• The 62-year-old says he buys and sells mortgages for a living.

• He and his wife, Elena, run several companies between them, including Vincorp Financial, Salvatore Empire Investments, Bostion Inc. and Arnach Inc.

• Says he brought Kronenfeld’s mortgage on 430 Tapscott for $1.3 million.

• Says that when the mortgage first went into default, he advised Hilary Salmon to sell the Tapscott property and release the five homes attached as collateral, but she did not.

• “I’m waiting for a miracle,” says Salvatore of efforts to collect on what he is owed.

Joyce Williams, Pat McLaughlin,

June Douglas

• Three women were all part of group that put in money for down payment and renovations on 430 Tapscott Rd.

• Williams, a retired nurse, and her sister McLaughlin, a house cleaner, together provided $100,000, part of which came from Williams remortgaging her home.

• Douglas, a single mother of four, borrowed $100,000 for church down payment. Salmon, their pastor, promised she would make the monthly payments on the loan.

KATE ALLEN

THE DEAL

• AJGL Developments, Semion Kronenfeld’s company, sells 430 Tapscott Rd. to Greater Works Ministry for $3.7 million on Aug. 8, 2008.

• Greater Works makes a down payment of $150,000.

• The church’s first, conventional mortgage is for $2.3 million. Monthly payments are $23,000, with the balance due in a year.

• Kronenfeld provides the group with a second, “vendor take-back” mortgage for $1.25 million. Monthly payments are 10 per cent, or $10,417, with the balance due in a year. Five homes are included as collateral.

• The church’s income includes more than $15,000 monthly from an appliance business renting half the Tapscott property — Kronenfeld “indemnified”, or guaranteed, that lease as a condition of the sale — and thousands of dollars from charitable donations.

• In November 2008, Kronenfeld sells the second mortgage to Vincent Salvatore for $1.3 million.

• When the church falls into default on its mortgage payments, the Tapscott property is seized by the bank and sold for $3 million, paying off only the first mortgage.

• The second mortgage, now belonging to Salvatore, is still outstanding, and the $1.25 million lien still stands on all five homes, including pastor Hilary Salmon’s. The equity on the homes amounts to far less than that figure, however.

GAMBLING and Athletes what a mix !!

ALEX RODRIGUEZ - Here we go again GAMBLING and Athletes what a mix !!
Lake Worth, FL
By Arnie Wexler CCGC

When Will Sports Confront Gambling Problems of Its Own Athletes?

Athletes may be more vulnerable than the general population when you look at the soft signs of compulsive gambling: high Levels of energy; unreasonable expectations of winning; very competitive personalities; distorted optimism; and bright with high IQs

It is time for college and professional sports to outline and executive a real program to help players who might have a gambling problem or gambling addiction problem. Yet college and professional sports still do not want to deal with this. They do not want the media and public to think there is a problem.

TWELVE years ago, as a compulsive-gamblers counselor, I was sent an airplane ticket from the National Basketball Association office in Manhattan and met with league officials, players and union officials, concerned about players' gambling. I was told, "We have a problem, and we're trying to find out how bad the problem is." Officials asked me to keep my calendar open for the spring of the following year and said to me that they hoped that I might address every team in the league.

When I hadn't heard from the NBA, I called and asked, "When do we start?" The talked were cancelled, and the response I got was this: "They said that the higher-ups didn't want the media to find out."

And over the years, I have spoken to many college and professional athletes who had a gambling problem. One NCAA study a few years ago reported: "There is a disturbing trend of gambling among athletes in college." You can't think that these people will get into the pros and then just stop gambling.

Compulsive gambling is an addiction just like alcoholism and chemical dependency, and all three diseases are recognized by the American Psychiatric Association's diagnostic and statistical manual. Nevertheless, we treat compulsive gambling differently than the other two addictions. Society and professional sports treat people with chemical dependency and alcoholism as sick persons, send them to treatment and get them back to work. Sports looks at compulsive gamblers as bad people and gets barred them from playing in professional sports.

If colleges and professional leagues wanted to help the players, they would run real programs that seriously address the issue of gambling and compulsive gambling. Education and early detection can make a difference between life and death for some people who have or will end up with a gambling addiction.

One sports insider said to me: "Teams need to have a real program for players, coaches and referees, and they need to let somebody else run it. When you do it in-house, it's like the fox running the chicken coop. You must be kidding yourself if you think any player, coach or referee is going to call the league and say, 'I've got a gambling problem, and I need help.' "

When you look at the headlines about professional athletes, coaches and referees on the perils of gambling, odds are very good that might be looking at the tip of the iceberg. Here are several from the recent past:

Investigators from Major League Baseball are trying to arrange a date to meet with Yankees third baseman Alex Rodriguez to discuss allegations that he participated in illegal poker games, according to a report Thursday by ESPN.com. And its not the 1st time

= Pete Rose [on the Donahue show, November 1989]: "I didn't seek help for my gambling problem until the middle of September, and I know it's something I can't lick by myself. I need help."

= Charles Barkley troubled by gambling addiction problem.

= Dolphins' Will Allen investigated for pulling out gun in dispute over gambling debts.

= Antoine Walker has a scheduled court in Las Vegas in a case involving an $822,500 gambling debt.

= An arrest warrant for Shawn Chacon as a result of his alleged failure to pay Caesars Palace $150,000 in gambling markers.

= John Daly says gambling problem will "ruin me" and says he has lost between $50 million and $60 million during 12 years of heavy gambling .

= Russia's Nikolay Davydenko was at the center of the match-fixing controversy in tennis.

= Michael Jordan was spotted at the baccarat pit of an Atlantic City casino in the wee hours of the morning before game two of the Eastern Conference Finals.

= Art Schlichter spent a decade in prison: "Ten years, seven months and two weeks, inside 44 various jails or prisons" because of gambling addiction.

= NBA referee Tim Donaghy is now in recovery for his gambling addiction. (From Tim Donaghy's book if ever released: "I kept waiting for a Knicks game when Stafford, Bavetta and Kersey were working together. It was like knowing the winning lottery numbers before the drawing!")

= March 1991: Lenny Dykstra, a notorious high-stakes bettor, was linked to a gambling probe in Mississippi. Dykstra was indicted in May on federal bankruptcy charges for allegedly removing, destroying and selling property that was part of a bankruptcy estate without the permission of the trustee.

= Paul Lo Duca says he bets with off-shore bookies, which, he claims, is legal. Running up big gambling debts -- or even being perceived as a heavy gambler -- leads to serious trouble. (What's interesting about is that neither Major League Baseball nor the Mets seem bothered about the reports. Oh, the commissioner's office mumbled something about gambling being bad.)

And for some its to late --- Denver Broncos wide receiver Kenny McKinley

had a gambling problem and was deep in debt when he commited suicide on Sept 21st

There are people in various sport's halls of fame who are convicted drug addicts and alcoholics, yet compulsive gamblers are unable to get into these halls of fame. In fact, as far as professional sports goes, an alcoholic and chemical dependent person can get multiple chances, whereas a gambler cannot.

I am a recovering compulsive gambler who placed my last bet on April, 10, 1968, and I have been fighting the injustice of how sports, society and the judicial system deal with compulsive gamblers for the last 43 years.

Las Vegas: 3rd Slaying in 2 weeks

Fatal Vegas casino punch was self-defense, claims wife of accused
By Barry Leibowitz

(CBS/AP) LAS VEGAS - The wife of Florida high school football coach Benjamin Hawkins, who's being held on a murder charge, says Hawkins was defending himself when he threw a single punch that authorities say killed a man in a casino on the Las Vegas Strip.


"It just looked like he wouldn't leave my husband alone," Leticia Hawkins, 35, a banker from Gainesville, Fla., told The Associated Press. "My husband was defending himself."


Benjamin Hawkins pleaded not guilty Friday during a brief appearance before a Las Vegas judge, who scheduled a Tuesday bail hearing in the death of 46-year-old John Massie, of Roy, Utah.


Defense attorney Jack Buchanan told AP he wanted to review security videotapes that police say clearly show the confrontation between Hawkins and Massey after the two exited a men's restroom at O'Sheas Las Vegas Casino. The video shows the single punch that felled Massie.


Benjamin Hawkins, who is black, told police that Massie, who's white, made a comment about a "black man in a yellow shirt" in the restroom. He also said he told Massie to shut up before the two men squared off in a food court area of the hard-partying, Irish-themed casino that lures pedestrian traffic on a block that includes the Harrah's, Flamingo and Caesars Palace resorts.


Police say Hawkins told them he interpreted Massie's actions as aggressive, and he feared that if he turned his back on Massie, he'd be attacked from behind. Benjamin Hawkins whirled and punched Massie once in the jaw, according to a police report.


The Clark County coroner determined Massie died of a head injury from the punch and a fall to the floor. The death was classified as a homicide.


Benjamin Hawkins is a teacher and assistant football coach at Bradford County High School in Starke, Fla.


Jeremy Brown, a friend who was visiting Las Vegas with the Hawkinses, said he didn't think racial bias played a role in Hawkins' mind during the confrontation.


"Ben did not hit the other person just because he was white," Brown said. "Race may have been what motivated the other guy."


The slaying was the third on the Vegas Strip in less than two weeks. Police say the deaths - including the fatal stabbings of a 21-year-old man Monday on a pedestrian walkway between casinos, and of another 21-year-old Las Vegas man in a pre-dawn confrontation June 25 - are not related, and arrests have been made in each case.

Gambling Addict Antoine Walker pleads guilty to casino debts

Antoine Walker pleads guilty to casino debts

Former University of Kentucky and NBA star Antoine Walker has pleaded guilty to passing bad checks in the form of unpaid gambling debts in Las Vegas.

The Las Vegas Sun reported the former all-star who now plays for the NBA Development League's Idaho Stampede will be put on probation and work toward paying off $750,000.

The criminal complaint against Walker was filed in 2009, accusing him of having the debts at Caesars Palace and Red Rock.

Walker won an NBA title in 2006 with the Miami Heat.

Moody's warns Caesars' debt burden....

Moody's warns Caesars' debt burden may 'weaken competitive position'
By Howard Stutz
LAS VEGAS REVIEW-JOURNAL

Investors in Caesars Entertainment were warned Wednesday the casino operator is not out of the woods financially despite companywide cost-cutting measures.

In an analysis report on the Las Vegas-based casino operator, Moody's Investor's Service said Caesars, which operates 10 Strip-area casinos, including Caesars Palace, Rio, Harrah's and Bally's, doesn't have any significant long-term debt coming due until 2015.

However, the company's debt of more than $23 billion "is eating its cash and may weaken its competitive position."

Caesars, which had been known as Harrah's Entertainment, became privately held in a 2008 private equity buyout valued at $29 billion. The company does have publicly held debt and attempted to list some shares publicly last year before abandoning the plan.

Loveman addicted to Loveman

Gary Lovemen, brilliant mathematician, who drove Harrah's from a non-entity to the MacDonald's of Pop and Slots by sucking in the suckers, whose success has gone to his waistline can't understand that as folks have figured out that along with his financial success comes cannibalization and crime, not everyone wants his snake oil.

Loveman seems addicted to Loveman these days.

It seems money markets have defined casino capitalism for what it is - Gambling.

Harrah's pulls $575m flotation
as gaming hits a losing streak

Caesars Palace owner hit by slump in US consumer spending, while debt from private equity buyout costs $1.5bn in interest


Las Vegas, and Harrah's, have been badly hit by the US recession, with property values collapsing and the municipality insolvent.

Harrah's Entertainment, the major US gambling group, which operates Caesars Palace in Las Vegas and four casinos in London, has abruptly shelved plans for a $575m (£360m) share offering in New York, citing weak investor demand.

The cancellation, which came on the heels of a $22bn General Motors share offering launched successfully in New York, has sent a chill through the gambling and private equity industries.

Harrah's, which is renaming itself Caesars Entertainment, operates the Rendezvous Casino in Mayfair and the Golden Nugget off Piccadilly Circus, the World Series of Poker tournament, as well as 50 hotels and casinos in the US under the Caesars, Harrah's and Horseshoe brands.

One of the largest global gaming companies, Harrah's public offering comes less than three years after it was purchased for $31bn by the New York private equity firms TPG and Apollo Management.

Leading financiers, including the sub-prime hedge fund king John Paulson, are exposed; the company says it is keeping its options open on a future offering.

The failure to complete the initial public offering (IPO) suggests that the eagerness of banking and private equity to get into the gambling business was misguided.

Expectations of an online gambling boom have not been realised; the US industry, where Harrah's is focused, has been hit hard by the two-year downturn in consumer spending. Last year, the casino operator MGM nearly collapsed under its $14bn debt. While stocks in operators such as Las Vegas Sands and Wynn Resorts have risen this year, most growth has come from a Chinese-driven gaming boom in Macau.

Despite Las Vegas's ardent efforts to promote itself through Hollywood movies as the anything-goes capital of America, the desert city is experiencing the worst downturn in its history. Property values in what was the fastest-growing city in the US five years ago have collapsed and the surrounding municipality of Clark County is in effect insolvent. Unemployment stands at 14.3%, well above the 9.5% national average.

In the post-credit crunch landscape, banks have had to pick up the pieces. Next month, Deutsche Bank will become owner of the Vegas strip's newest hotel-casino, The Cosmopolitan, after its original developer defaulted on a $1bn loan. The bank then put $3bn more into the hotel, which features the rapper Jay-Z at its New Year's Eve party and is promoted with the slogan: "Just the right amount of wrong."

For Harrah's, the only US operator without a casino in Macau, the plan to sell less than 10% of company stock in an uncertain market for public offerings was itself a gamble. Harrah's has reported a loss of $634.4m in nine months. As the most highly leveraged of the big casino firms with $20bn in debt, it paid about $1.47bn interest over the same period.

Analysts say the industry is picking up but is not strong enough to withstand the test of an IPO amid fears over European debt woes and China's currency controls.

In a speech to a gaming convention last week, Harrah's president Gary Loveman indicated that a major block to growth of casino companies was lack of consumer access. Loveman said casinos should be given the same freedom to market as other products or activities considered unhealthy, such as alcohol or fast foods. "It should offend us every day that adults can't entertain themselves in the way that they want to when they have access to so many other things," Loveman said. [Oh? Never one to suffer pangs of conscience when confronted with an Industry that only profits by continuing to create Gambling Addicts!]

Gambling industry executives in Vegas claim the market is improving, with international visitors up 8% on a year ago. But after years of price-cutting, many visitors are considered "low rollers" drawn by cheap hotel rooms but gambling little.

$20 Billion Harrah's/Caesar's debt

World's biggest casino owner set to raise $532M

NEW YORK -- Investors will get another chance to roll the dice on the world's biggest casino operator next week. It may be a risky bet, according to some observers.

Caesars Entertainment Corp. - formerly Harrah's Entertainment ( HET - news - people ) - plans to raise as much as $532 million with an initial public offering.

Its shares will start trading at a financially precarious time for the casino business. Like the rest of the industry, Caesars hit a wall during the recession as people opted to save their extra cash rather than gamble it. Results for the first nine months of this year suggest the high rollers haven't come flocking back.

In a recent securities filing, the company said it lost $634.4 million during the nine months ended Sept. 30.

On top of that, Caesars is burdened with close to $20 billion in debt. A lot of it was piled on by the two private equity firms - Apollo Management Group and Texas Pacific Group - that took the company private three years ago and that plan to keep control of it after the IPO.

Francis Gaskins, president of the research firm IPOdesktop, noted that Caesars is spending 22 percent of its revenue on interest payments.

Apollo and Texas Pacific took Caesars private in a $30.7 billion deal back in 2007, a takeover that ranked as one of the biggest leveraged buyouts in corporate history. The company owns more than 50 casinos in 12 states and seven countries, from Egypt to Uruguay.

The company's filings show revenue hit a peak the year of the buyout at $10.8 billion, then tumbled 6 percent to $10.1 billion in 2008. The downturn resulted in a $5.5 billion net loss for the year as the company took accounting charges to write off the value of its assets.

Revenue dropped another 12 percent to $8.9 billion in 2009, but cost cutting helped preserve a $473 million profit for the year.

Caesars says the IPO next week will help it expand. It plans to use the cash to continue construction of the 660-room Octavius hotel tower at Caesars Palace on the Las Vegas Strip, halted last year after just its exterior was finished.

It also wants to fund a joint venture in Ohio with Rock Gaming LLC and add an entertainment and dining area linking the Imperial Palace and Flamingo casinos on the Strip's east side.

Caesars is selling 31.3 million shares for $15 to $17 each, which works out to as much as $532.1 million. It plans to trade on the Nasdaq exchange under the symbol "CZR."

Together, Apollo and Texas Pacific will hang on to an 81 percent stake in the company.

Nevada casinos warned to keep distance ....

Nevada casinos warned to keep distance from foreign Internet gambling companies

According to this story in the Law Vegas Review-Journal, the Gaming Control Board of Nevada, is advising gaming registrants to keep their distance from Internet gambling companies that accept bets from Americans. The issue arose after two poker events sponsored by foreign Internet gambling companies were hosted by two Las Vegas casinos, and after news surfaced that foreign Internet gambling operators were teaming up with US land-based casino operators to provide Internet gambling services to Americans in anticipation of a US federal approval of a proposed Internet gambling bill.



From Las Vegas Review-Journal


Questions about the business relationships arose after two poker events earlier this year on the Strip.

In February, The Venetian held the inaugural event of the North American Poker Tour, which is sponsored by PokerStars.net. In the $5,000 buy-in event, 872 players entered, including 25 who qualified through PokerStars.net.

In March, Caesars Palace hosted the National Heads-Up Poker Championship. The event did not have an online poker sponsor but a related televised poker event, "Face the Ace," was filmed in several Las Vegas casinos and sponsored by FullTilt.net.

The World Series of Poker, which began last week and is televised throughout the year by ESPN, is in the second year of a sponsorship deal with Everest Poker, an online gaming site whose logo is placed on tournament gaming tables. Everest Poker, which is based in Malta, does not accept wagers from Americans.

Gaming regulators are currently investigating the suitability of 888, an online gaming company based in Gibraltar that is providing software for Harrah's Entertainment to manage three Internet gambling sites in the United Kingdom, which do not accept wagers from Americans.

The issue marks the first time Nevada regulators are investigating the suitability of an online gaming company that accepted wagers from Americans before the act's 2006 adoption.