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Showing posts with label Chukchansi. Show all posts
Showing posts with label Chukchansi. Show all posts

Sunday, May 24, 2015

Chukchansi’s ‘forgotten’ people: workers left without jobs in wake of shutdown



Chukchansi’s ‘forgotten’ people: workers left without jobs in wake of shutdown

As Chukchansi closure passes six months, many workers’ unemployment benefits are expiring

Without help, some former casino workers will go back to the fields
 Other workers go back to school to get high school diplomas 
Elvia Cortez
Francisco Silva
Mary Burks plays with rescue dog “Blue.” She and husband Don prepare to move out of their dream home near Bass Lake, gone to foreclosure with the loss of Mary’s job at Chukchansi Gold Resort & Casino as a blackjack dealer. They will move in with a daughter in Nashville, Tennessee. Don is a retired CHP officer with a pension and Social Security, but with Mary’s job gone, their income is cut in half.
Mary Burks, right, in a publicity shot for Chukchansi Gold Resort & Casino at her job as a blackjack dealer.
Items in foreground, from her long-held job as a blackjack dealer at Chukchansi Gold Resort & Casino, lost to the shutdown, Mary Burks and husband Don now prepare to move out of their dream home near Bass Lake, lost to foreclosure. They will move in with a daughter in Nashville, Tennessee. Don is a retired CHP officer.
Don Burk’s CHP hat sits in items as he and wife Mary prepare to move out of their dream home near Bass Lake, lost to foreclosure, after the loss of her job at Chukchansi Gold Resort & Casino. They will move in with a daughter in Nashville, Tennessee. Don is a retired CHP officer.
Mary Burks and husband Don, with their rescue dog Blue, now prepare to move out of their dream home near Bass Lake, lost to foreclosure, after the loss of her job at Chukchansi Gold Resort & Casino. They will move in with a daughter in Nashville, Tennessee. Don is a retired CHP officer.
 
 
Efrain Amezcua
 
When Chukchansi Gold Resort & Casino was forcibly closed in October, more than 1,000 employees lost jobs. Many still are looking for work.

Finding a job has taken on added urgency since their six months of unemployment benefits expired. For most, that came at the end of April. The benefit paid a maximum of $450 per week.


Mary Burks, a former card dealer at Chukchansi Gold, has lost more than hope that the casino will open again soon. Since her unemployment benefits ended, she and her husband realize they are going to lose their house of 18 years.

Burks, 55, was laid off after the stunning shutdown. It was ordered by state and federal authorities the day after an Oct. 9 showdown between police forces representing rival tribal leadership factions.

“I think the focus has been on what happened to the casino and the tribe and we’ve kind of gotten lost, over 1,000 people,” Burks says.

Tribal leaders continue to negotiate with federal and state officials to reopen the casino. The tribe also will need a green light from bondholders who bailed the casino and resort out three years ago with a restructured financing package valued at more than $250 million.

For the employees, the layoff and wait for the casino to reopen has put them on a long glide down the economic ladder. They lost not only paychecks but health insurance, as well. Now, with unemployment benefits running out, they’re left to apply for food stamps and public assistance while they seek new jobs.

About 500 laid-off employees are from Madera County, while Fresno County officials report around 400 employees living in their region.
Some of the workers, who were at the casino for a decade or longer, say they will go to work in farm fields or packinghouses.

We had really good jobs and had a really good workplace. We wanted to go back.
Mary Burks, laid-off card dealer

Many employees are seeking re-training or high school diplomas. In Madera County, between 100 and 150 have sought help through the Madera County Workforce Investment Corp., says Elaine Craig, the agency’s executive director.
“They realize they are not going to make the same wages in a job without a high school diploma or formal training,” she says. “These folks desperately want to work.”

A few have managed to stay in the business. Black Oak Casino Resort in Tuolumne County recently had a job fair and hired 60 people, including a handful from Chukchansi. Table Mountain Casino has hired about 10 former Chukchansi workers since October.

Will the casino reopen?

Chukchansi Tribal Chairman Reggie Lewis sees a possibility that the casino could reopen by the end of the year — three to six months.

Gaming commission officials in Washington, D.C., declined comment on time frames. A governor’s office spokesman also offered no hint about ongoing negotiations.

“We’re continuing to work with all parties to help facilitate a reopening when public safety concerns are met,” says Evan Westrup, a spokesman for Gov. Jerry Brown.

Lewis says progress is being made in talks with the National Indian Gaming Commission. “We are also talking to the bondholders about getting the money to open the casino. We are doing everything we can to get it open as soon as we can.”

A sticking point could be the timing of an election that was supposed to occur earlier this month. Lewis says it was delayed until October so the council can keep the same people in place who started negotiations to reopen the casino.

Lewis says former employees will likely be rehired; workers who were part of a union must be offered their jobs back under contract guidelines.

He says he feels for the workers, who had insurance and good pay, but also tribe members, especially elders, who once received utility payments, groceries and meal cards to eat at the casino. Families, too, were given education money and clothing allowances and students received financial incentives for grades.

“Our tribal members got pretty used to getting tribal benefits and the tribe could provide services to tribal members, but now those are all gone,” Lewis says.

No more benefits

Unemployment benefits were paid to any worker who participated in job training, says Craig with Madera County’s Workforce Investment Corp. Some found new work soon after the casino closed.

About 60 are enrolled in Madera Adult School to learn English and get a high school equivalency diploma. “They are coming to the realization that they had an amazing job with benefits and well-above minimum-wage salary and that they have to do some work now to get to that level of wage and stability,” Craig says.

I was treated well. Now, it’s very hard to get a job at 55.

Francisco Silva, who trained other resort workers

Of Fresno County’s 394 identified Chukchansi employees invited to an orientation, 44 showed up and 30 are receiving services, whether it’s job search assistance or training, says Tamico Thomas, a senior outplacement specialist with Fresno County’s Workforce Investment Board.

Lost house

When Burks lost her $48,000-a-year card dealer’s job, she got unemployment. The $450 per week allowed her and her husband, Don Burks, 77, a retired California Highway Patrol officer, to continue to make payments on their home of 18 years in Teaford Meadows.

Now, she has little hope the casino will reopen or that she can find a job that can pay the bills. Any training offerings, such as welding, didn’t match her skills. So, she and her husband are moving to Tennessee to live with their daughter.

“Everything we had went into that home,” she says. “We customized it, expanded it.”

Even with her husband’s pension and Social Security, the Burks still couldn’t pay for the 3,000-square-foot house. They have told the bank they are walking away from the home.

Burks started at the casino in 2004, a year after it opened. She says the tribe’s bickering was a constant but workers did their best to ignore it. When customers brought it up, Burks says, she would change the subject.

She liked her job and the people she worked with. “We had really good jobs and had a really good workplace. We wanted to go back.”

New business

Jose and Dolores Flores are working to get back on their feet after Jose lost his groundskeeper job at the resort.

Dolores was a card dealer at Chukchansi but quit in 2010 because her daughter suffers from asthma and she smelled like smoke after she came home from work.

“I didn’t have to stay in that job just for the money,” she says.

But Jose had benefits through his job that are gone now. His unemployment insurance has also expired.

Now he is working with his wife at her Oakhurst store, Fine Native Handcrafts. The couple, parents of seven children, get products made by Indians from Guatemala, Peru, Ecuador and Mexico to sell at their store and at farmers markets and fairs throughout the region.

The Floreses say they’re doing fine. Dolores says business is good, and she plans to open a natural foods store with fresh fruit and juice next door to the handcrafts shop. Working in the family business has been better for Jose personally.

“I think we do better this way,” Dolores says. “He does the set-up; it’s too much for me and my daughters.”

They know they are better off than some of their friends who lost jobs. Jose says he knows many whose best opportunities are working in the fields again.

Still seeking work


Francisco Silva, 55, of Madera, worked at Chukchansi for 10 years. His oldest son, Gerardo, lost his job at the casino, too. Before working there, Francisco Silva refinished antiques for more than 20 years. At Chukchansi, he earned $20 an hour with full insurance. He trained new employees on heavy equipment and was government-certified to operate the pool at the resort.

I miss my coworkers, the work I did, the routine.

Efrain Amezcua, casino janitor

“It’s very sad,” Silva says. “I was treated well; Now, it’s very hard to get a job at 55.”

He is taking odd jobs wherever he can.

Elvia Cortez, 59, gets some state money for taking care of her 86-year-old mother at her home in Madera and has a little bit of unemployment money still coming in. But if she goes out looking for work or to her classes, she has to pay someone to watch her mother.

She appreciated the year-round employment the casino offered and says she loved working in the casino’s kitchen. Now, she is back in school. The last time she was in a classroom was 43 years ago when she left Mexico with a ninth-grade education.

Her job search isn’t going well. “I went to job fairs, put in applications and nobody called me.”
Now, she is considering packinghouses.

“All the work around here will be temporary,” she says. “It will be a couple weeks, a couple months and no guarantee of a job … at this point, we’ll take anything we can.”

Efrain Amezcua, 47, and his wife, Hermila, worked at the resort since it opened. Efrain was a janitor making about $12 an hour: “It was full-time, year-round and there was always stuff to do.” He’d like to find work in his profession, “but there is nothing like that.”

He says he tried other casinos without success. “I miss my coworkers, the work I did, the routine.”
Magdalena Figueroa, another of the casino’s first employees, is a single mother of two getting about $60 in food stamps. Since her unemployment expired, she’s had to reapply for welfare.

She also is considering field work, possibly vineyard trimming, which she hasn’t done since before starting at Chukchansi Gold in 2003. She was earning $14 an hour when the casino closed.

“I borrowed money and the little money I had put away I used to make the rent,” she says.

Casino work available

Ron Patel, general manager of Black Oak Casino Resort in Tuolumne County, says there hasn’t been much interest from former Chukchansi employees: prior to a job fair this month, 16 applicants, four hired.

“We did think we’d get more response,” Patel says. “Our guess was people thought it would reopen soon.”

Distance may have been a factor. Black Oak is more than an hour’s drive each way from Madera and Fresno, where the bulk of Chukchansi employees live.

Black Oak has 880 employees and 148 rooms in its hotel, which is about three-quarters the size of Chukchansi Gold Resort & Casino.

Closer to home, Table Mountain Casino in Friant added about 10 card dealers. Dan Casas, the tribe’s lawyer, says the casino doesn’t get much turnover and many new hires already have family members working there.

Frustrated supervisor

Madera County Supervisor Tom Wheeler, who represents the Coarsegold and Oakhurst areas, says the employees are forgotten, and there is little he can do to help. State officials tell him there are no programs available to extend unemployment benefits.

He laments the loss of county revenue, both tax money generated by Chukchansi workers and the tribe’s $92,000 monthly payments that ended after the casino closed. Nonprofits also are hurting. Earlier this year, the tribe neglected to give local nonprofits $1 million in contributions because of tribal infighting.

“It’s just a shame that it has to be this way,” Wheeler says. “It doesn’t have to be if it wasn’t for their greed and doing this to their own people.”
 
 

 

Saturday, April 11, 2015

Madera County judge rules Chukchansi Casino raid case will proceed


VIDEO ON LINK



The criminal case against 15 defendants charged with various crimes during a raid at Chukchansi Casino last year will proceed, a judge ruled on Friday.

The motion to dismiss was on the grounds Madera County had a lack of jurisdiction since these events happened on Native American land. Part of the issue was also whether the police force hired by the Tex McDonald faction were true law enforcement officers the day they were seizing records from the gaming office.

Seven months later, faction leader Tex McDonald and tribal employee Vernon King are still locked up. Thirteen others posted bail and were released, including several others who say they should be exempt from the crimes which are alleged, since they were acting as police officers during the raid.

"The judge actually made a very interesting ruling. He didn't rule on the sovereign immunity issue at all as to the police officers. He ruled that the police officers could still be charged with excessive force," attorney Patrick Hanly said.

Inside court, Madera County Superior Court Judge Dale Blea pointed to other rulings around the country related to Native American land, property, crimes and jurisdictions. In the end, he said all sides can present evidence at the preliminary hearing, in what is a very rare and complicated case.

"The court noted that the tribe may select its own leaders, but leadership disputes may not be settled by means that violate state criminal laws. That's the question to be answered here," said Blea.

Attorneys argued the tribal police officers, hired by the Tex McDonald faction, cannot be charged with crimes such as kidnapping and assault with a deadly weapon because they were acting within the scope of their job during the raid.

But Madera County District Attorney David Linn believes there is some question about their authority at all. "Supposed police officers," he said.

The fighting among factions continues, according to tribal chairman Reggie Lewis. But leaders are working toward opening the casino again, as soon as possible.

"I've heard three or four months thrown out there as the earliest, and six months to a year at the latest," said Lewis.

In the meantime, the criminal case that closed the casino continues. And the district attorney is looking forward to a resolution, as soon as possible.

"I'm anxious to get this over with one way or the other. I am anxious to take this burden off the taxpayers of Madera County, which is what it is, and I am anxious for the casino to reopen," said Linn.

The defendants were all arraigned on Friday and pleaded not guilty. A preliminary hearing date will be set next week.
 
 
 
 

Saturday, November 1, 2014

15 charged with felonies in Chukchansi Gold casino armed confrontation




15 charged with felonies in Chukchansi Gold casino armed confrontation

The Fresno BeeOctober 31, 2014
 
 
Tex McDonald. right, emerges from federal court following a brief hearing over the closure of Chukchansi Gold Resort & Casino Wednesday, Oct. 29, 2014 in Fresno. ERIC PAUL ZAMORA — THE FRESNO BEE

Read more here: http://www.fresnobee.com/2014/10/31/4209550_madera-county-da-to-announce-criminal.html?rh=1#storylink=cpy
 
Fifteen people involved in the Oct. 9 armed confrontation at Chukchansi Gold Resort & Casino have been charged with multiple felonies, Madera County District Attorney Michael Keitz announced Friday.
The forced takeover of the casino occurred when people directed by Tex McDonald, the leader of one of the contentious factions of the Picayune Rancheria of Chukchansi Indians, took over the gaming center from a tribal faction overseen by Reggie Lewis and Nancy Ayala. The casino and hotel has been closed since then.

Those charged include McDonald; his fellow tribal council member, Vernon King; McDonald’s tribal police chief, John Olivera; David Lee Dixon; Timothy Tofaute; Shawn Fernandez; Tyrone Mark Twain Bishop; Benjamin James Rhodes; Jim Glasscock; Brian Lec Auchenbach; John David Cayanne; Ronald Jones; David Paul Anderson; and Miguel Ramos.

All are charged with various felonies: kidnapping, false imprisonment, assault with a firearm, assault with a deadly weapon, battery inflicting serious injury and assault with a stun gun. McDonald’s bail will be set at $1 million, while the other 13 will have bail set at $800,000 apiece. McDonald has two prior strikes dating back to 1992 and 1995 for assault with a deadly weapon and making criminal threats.

A 15th man, Eric Domingo Flores Suniga, was charged with assault with a stun gun. His bail will be set at $25,000.

The McDonald faction had sole control of the casino for most of 2014 until Aug. 24, when members of the Lewis group entered the casino in the wee hours and holed up in offices and suites in the hotel’s 10th and 11th floors. The McDonald group then entered the casino on Oct. 9, provoking the battle in an attempt to gain control of gaming commission offices to unearth audit information.

During a hearing in U.S. District Court in Fresno on Wednesday, Judge Lawrence O’Neill referred to a declaration filed by the state Attorney General indicating that at least one member of the Lewis-Ayala security forces was armed with a gun. Other guns were found on the casino grounds, too, in the possession of the Lewis-Ayala faction’s security forces, the declaration said.
 
TIMELINE: Chukchansi casino’s creation and controversy

Sheriff’s reports recommending charges were sent to the district attorney on Tuesday, said Michael Keitz, Madera County district attorney.

“After several meetings with the Madera County Sheriff’s Office, we developed complaints in the case, those complaints were taken before a judge (Thomas Bender in Madera County Superior Court) today,” Keitz said during Friday’s news conference.

Two separate complaints — because of the large number of defendants — were issued, each charging 29 counts.

As of late Friday afternoon, Keitz said, no suspects had been arrested. Keitz said suspects can turn themselves into law enforcement or they will be found and arrested.

If convicted of the charges, those arrested could face a “significant amount” of time in state prison, Keitz said.

Regarding previous problems at the Picayune Rancheria of Chukchansi Indians, submitted to Keitz, he said: “The cases that I am familiar with, that have been turned over, have been declined for prosecution because the evidence did not meet the beyond-a-reasonable-doubt standard.”

Keitz said that his office has jurisdiction to deal with criminal allegations on tribal lands under federal legal guidelines, but has no jurisdiction to address civil matters. “It is not our duty here to get involved in the disputes between the tribal members. It is our duty to enforce the laws where there is a violation of the laws.”

In a prepared statement, David Leibowitz, a spokesman for the McDonald faction, said he and the others “did nothing wrong and nothing illegal.”

Leibowitz said the McDonald group had the authority to get control of the tribal gaming commission, and that the leaders and tribal officers “put no patrons in danger and they harmed no one.”

Said Leibowitz: “We fully intend to work cooperatively with the District Attorney’s Office to bring this matter to a quick conclusion and to clear these trained professionals’ and leaders’ names, just as we will continue to pursue justice for the Chukchansi people in the eyes of the law.”

Richard Verri, lawyer for a tribal faction led by Reggie Lewis, said the arrests were a “welcome development.”

“What these men did to the tribe, casino, employees and the community was a great loss,” he said.
Reggie Lewis said the arrests should have occurred weeks ago.

“I think it’s been a long time coming. A lot of people, me included, thought arrests should have happened, if not that night, at least the next day because they were all shown the videotapes of what happened and it was pretty clear that laws had been broken.”

He said people told him they didn’t feel safe, but that the arrests are a positive step. The order from Judge O’Neill on Wednesday put the blame squarely on the McDonald group, Lewis said.

“If you read the court order, it specifically pointed out that it was the McDonald faction that did these things and now that they’ve been arrested,” he said. “Hopefully, that will make a big impression on the NIGC and folks in Washington, so they see that the criminal element has been removed.”

He said he is still “hoping maybe they can get the casino open in a few weeks.”

A spokesman for the state attorney general said the office had no comment on the charges being filed.

The Attorney General’s Office and the National Indian Gaming Commission closed the casino three weeks ago. The injunction filed by the attorney general was supported by U.S. District Court Judge Lawrence O’Neill on Wednesday in Fresno. Efforts to reach the NIGC officials were unsuccessful.

The criminal complaints were filed four days before Election Day, and Keitz is fighting for his seat in a tight battle with private attorney David Linn.

Linn said Keitz’s announcement Friday smacked of political opportunity.

“Mr. Keitz has resisted the pleadings of law enforcement to get involved for years (at the rancheria) and refused to listen,” Linn said. “Now that eastern Madera County has been significantly impacted financially by the casino shutdown, he decides he wants to do something and help his campaign.”

Contact Marc Benjamin: mbenjamin@fresnobee.com, (559) 441-6166 or @beebenjamin on Twitter. Contact Carmen George: cgeorge@fresnobee.com, (559) 441-6386 or @CarmenGeorge on Twitter.



 

Read more here: http://www.fresnobee.com/2014/10/31/4209550_madera-county-da-to-announce-criminal.html?rh=1#storylink=cpy

Sunday, October 12, 2014

Ooops! Think you're safe in a Tribal Casino?








Federal judge orders California casino shut down

Friday, February 21, 2014

Chukchansi lawsuit requests casino money



Chukchansi lawsuit requests casino money
 

 
 
 
 
 
 
 
 
 
 
 
 
The managers of the Chukchansi Gold Resort & Casino in Coarsegold are the subjects of a lawsuit filed today claiming more than $316,000 in revenues were recently diverted by an illegal faction running the establishment.

The federal lawsuit is the latest in a year-long dispute involving the Chukchansi Economic Development Authority, tasked with overseeing the casino's finances, and another faction claiming to be the rightful tribal council of the Picayune Rancheria of the Chukchansi Indians.

CEDA Chairman Reggie Lewis said the faction now running the day-to-day operations has been illegally occupying the casino and tribal offices since last February when former council member Nancy Ayala forced out six other ruling members and put in place a team of managers loyal to her.

According to the tribal council led by Lewis, the question of who has purview over the tribe and casino was answered recently when the Bureau of Indian Affairs issued a letter recognizing the seven members of the Lewis-led council elected in 2010 to administer federal housing and assistance funds and carry out government-to-government relations.

Now, the Lewis council is taking its case to U.S. District Court claiming current management appointed by Ayala and the faction's new leader, Tex McDonald, has failed to deposit all revenues for the casino into a Rabobank account as per an indenture agreement to ensure timely bond payments for the casino as well as distributions to the tribe's roughly 900 members.

"It is unfortunate that a small group of individuals continue to defy the will of an overwhelming majority of tribal members and the recognition of the federal government," said Lewis, in a statement. "There is only one Tribal Council recognized by the United States and stealing money from the tribe will not be tolerated."

Specifically, the lawsuit, filed by the council's attorney Robert Rosette, alleges that several members of casino staff, including General Manager Giffen Tan, General Accounting Manager Joyce Markle and Chief Financial Officer Larry King, were involved in making a recent cash payment of $316,700 to an unauthorized entity not recognized by the United States.

The lawsuit states that an estimated $1.4 million monthly could be lost to the tribe if similar misappropriations continue in violation of the tribe's gaming compact approved in accordance with the Indian Gaming Regulatory Act.

According to the lawsuit, such payments sidestep legal review by the Board of Directors of CEDA, put in place in 2001 to own and operate the casino and whose members also make up the Chukchansi Tribal Council now recognized by the U.S. government.

The lawsuit seeks injunctive relief preventing current casino management from making any further disbursements to any entity other than the U.S.-recognized tribal council.

Tuesday, October 29, 2013

The Biggest Gamble at Indian Casinos: Tribe's Debt Obligations


Stop Graton Casino
Chukchansi Gold Resort & Casino missed half it's payment last month to the bank. Should we expect the same from Graton Casino?

The Biggest Gamble at Graton Casino: Tribe's Debt Obligations

The biggest bet involving Graton Casino won’t be made at a card table or slot machine. It’s with the project itself. At more than $800 million, Graton Casino is the costliest development project in Sonoma County history.

The tribe has borrowed heavily in order to foot the bill. But, what if the tribe misses expectations?

That’s been the case with other tribal casinos, which has quickly become an over-saturated market. If Graton Casino can’t attract enough gamblers from the Bay Area, it means the tribe will be in a debt predicament similar to the Chukchansi Casino.

Last month, the Chukchansi Gold Casino & Resort missed their interest payment by $6.25 million.
Vice-Chairwoman, Nancy Ayala and “her small faction of supporters have been seizing money for themselves,” according to tribal chairman, Reggie Lewis. A court order has been made to see where the money was spent and to ensure the remainder of the debt is paid, so the casino can remain open.

chukchansi casino

Should we expect a similar scandal if Graton Casino opens? Only time will tell to see who really reaps the benefit of this casino’s profit. .

The article below is from The Fresno Bee giving a brief story on the Chikchansi’s missed payment.

Chukchansi tribe misses half of casino payment

The Picayune Rancheria of the Chukchansi Indians was unable to make a full payment last month to the bank that restructured financing for the tribe’s Madera County casino, according to court documents released Friday.

The tribe’s financial predicament surfaced in a ruling by a New York judge who is requiring the two opposing factions, led by Nancy Ayala and Reggie Lewis, to give all their financial information to the trustee, Wells Fargo. Judge Melvin Schweitzer also wants a professional audit completed.

The Ayala group took control of the Coarsegold tribal business center and Chukchansi Gold Resort & Casino after a February referendum that the Lewis faction — which split from the Ayala group — contends was unconstitutional.

Schweitzer subsequently intervened and ruled that both sides need to sign off on payments.
In a hearing Wednesday, the judge said casino operators were obligated to make an interest payment of $12.49 million to the bondholders on Sept. 30, but paid only $6.25 million.

“We asked why they did not have sufficient money to make the interest payment,” said Richard Verri, lawyer for the Lewis group. “The Ayala group has been in control of the till; we want to know why the casino doesn’t have a plan for operating the business so it can pay its debts.”

The casino and Chukchansi Economic Development Authority, the agency in charge of the casino, “state that they have no existing plan for payment of the remaining interest,” court documents said.

But a spokesman for the Ayala group said it pledged to have the payment made by the end of the year.

“We continue to work with the bondholders in an effort to become current on bond payments across the fourth quarter of this year,” said spokesman David Leibowitz.
He said the bank was receptive to the Ayala group’s plan.

“They have been very receptive to this and we have every intention of paying our debts and making sure that the Chukchansi Gold Resort & Casino stays open,” he said.

Wells Fargo holds the $250.4 million note for casino investors. The bank sued because the Lewis group controlled a Rabobank account used to pay off the casino bonds, but the Ayala group refused to put money in that account and instead opened other accounts.

Schweitzer intervened and ruled that both sides need to sign off on payments that would go through Rabobank.

The tribe restructured $310 million in loans last year when it couldn’t make its payments. Under a new plan, the tribe agreed to extend its loan to 2020, allowing a longer-term payback for much of the remaining loan, but to pay a 9.75% interest rate. The previous interest rate was 8%.
Click here to read the full article.



Monday, June 24, 2013

Judge orders sheriff to till tap Chukchansi casino



Judge orders sheriff to tap Chukchansi casino profits to pay lawsuit

Published: June 22, 2013
 
— The Fresno Bee

A Madera County judge has ordered Sheriff John Anderson to go to Chukchansi Gold Resort & Casino and remove money from the casino till to recover money in a settlement for a former casino manager who sued the tribe.

The payout stems from a lawsuit by ex-casino and hotel manager Matt Olin, who is owed $725,000 after he was fired last year. He was in the middle of a five-year contract and the tribe waived its sovereign immunity to employ him.

That allowed Olin to file a lawsuit against the Chukchansi Economic Development Authority, an unincorporated arm of the tribe, if the tribe failed to live up to the contract.

Olin reached a $725,000 settlement but originally wanted far more, said Richard Verri, who represents a tribal faction led by Reggie Lewis.

But the other Chukchansi tribal council faction, led by Nancy Ayala, will fight the "till tap" ruling by Judge Michael Jurkovich.
 His ruling, which must be carried out by the end of November, said that if the tribe fails to pay Olin from casino proceeds, he can go after other tribal assets to enforce the judgment.


The "till tap" is proposed because the tribe's bank accounts are frozen as a result of a February dispute between Ayala's group, which runs the day-to-day operations from the tribe's business complex, and Lewis' group.

A tribal gaming consultant said a "till tap" at a California casino is highly unusual.

"We haven't seen this for years on an Indian reservation," said Michael Lombardi, a Riverside-based consultant and former casino manager. "We are in uncharted territory here."

The last one he recalled occurred at Table Mountain Rancheria's bingo hall in Fresno County more than 20 years ago. It was at a time when two tribal councils were fighting for control and a judge ruled the sheriff could go into the bingo hall to get money for a $15,000 legal bill, Lombardi said.

But that was years before the state's compacts were created, which spelled out rules for casinos in these types of disputes.

Lombardi said he expects a federal court will intervene and rule that the Madera County Superior Court is not the proper venue for ordering a till tap.

If the sheriff does go into the casino, it could potentially set off even more conflict in an increasingly tense situation, said David Leibowitz, a spokesman for the Ayala group.

"The part of this I found so startling is that this has been a very contentious situation for a long time and to suggest that the sheriff ought to go in with a show of force only invites more conflict," Leibowitz said.

He said the tribe will appeal the judge's decision.

Cliff Palefsky, a San Francisco lawyer who represents Olin, said that sovereign immunity issues are complicated but don't come into play in Olin's case.

But if either faction fights the settlement, Olin will want more money.

"Neither faction should have an interest in fighting us because it will cost them more," he said. "It's in their best interest to pay off Mr. Olin."

But Sheriff Anderson said he doesn't want to move too quickly. Last week, he asked the Madera County Board of Supervisors to hire lawyers with expertise in Indian matters to represent him because he is concerned about violating the tribe's sovereignty.

But he also worries that Olin's lawyer will sue Madera County if he doesn't get the money.
Anderson said all plans are on hold until he gets legal advice.

"This way someone can step in and mediate for me," Anderson said.

For now, he said, a deputy is stationed near the Coarsegold rancheria.

"However it works out doesn't really matter to me," the sheriff said. "But I have a deputy sitting up there trying to keep the parties apart and almost daily we get calls about allegations from one side against the other."

The best course of action, said Michigan State University law professor Matthew Fletcher, who monitors legal issues in Indian country, is to wait until the federal government settles the tribe's leadership dispute.

"It just seems to me there is no rush on this judgment," Fletcher said. "Just wait until this is all over — that would be my advice if I was the sheriff's attorney."

http://www.fresnobee.com/2013/06/22/3356452/chukchansi-till-tap-ordered-judge.html


Monday, October 29, 2012

Citibank And Casino Cash Gone In 60 Seconds And Bad Guys Comped





Citibank And Casino Cash Gone In 60 Seconds And Bad Guys Comped
Bill Singer
Bill Singer, Contributor

To Ara Keshishyan’s credit, he had an idea – illegal as it may have been – and he ran with it. According to a federal Indictment unsealed on October 26, 2012, in the Southern District of California, Keshishyan recruited at least 13 individuals, all of whom were recently arrested in the Los Angeles, CA area, as part of a conspiracy. The rip-off isn’t all that complicated in terms of its goal but the mechanism of getting there was damn clever.

Here’s what the Indictment alleges:

Ara Keshishyan put together a crew and gave each of the participants so-called “seed money,” which they deposited into Citibank checking accounts that each had recently opened. Thereafer, the crew traveled to the following casinos:
  • California: Morongo, Pechanga, San Manuel, Agua Caliente, Chukchansi, and Spa Resort
  • Nevada: Tropicana, Wynn, Bicycle, and Whiskey Pete’s (Las Vegas); and Harrah’s (Laughlin)
After arriving at their targeted casino, the conspirators went to on-premise cash advance kiosks and withdrew multiples of the deposits that they had previously made into the Citibank accounts.

Apparently, Keshishyan had discovered a glitch in Citibank’s security protocol whereby multiple withdrawals made within 60 seconds of each other at the kiosks would result in cash payments from the various cages at the casinos. The deposits and withdrawals were each kept under the federal transaction reporting level of $10,000 so as to conceal detection.

Being the alleged brains of the operation, Keshishyan kept the collected funds and doled out cuts to his conspirators. His take was generally used for gambling. On top of having gamed the Citibank cash advance process, Keshishyan and his crew were often “comped” into the casinos with free rooms based upon the level of their gambling.

NOTE: An indictment merely contains allegations and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The defendants include: Ara Keshishyan, 29; Ara Harutyunyan, 30; Artur Harutyunyan, 24; Vahe Asatrian, 29; Sarkis Mooshidian, 37; Levon Karamyan, 58; Migran Yamalyan, 30; Seryozha Harutyunyan, 59; Lianna Avetisyan, 24; Ashot Oganisyan, 30; Ovsep Sarfyan, 33; Daniel J. Thomas, 56; Hilda Hakverdyan, 53; and Asatur Asatryan,33. As of October 30, 2012, Levon Karamyan remains a fugitive. All 14 indicted defendants were charged with conspiracies to:
  • commit bank fraud and
  • to illegally structure financial transactions to avoid reporting requirements.,
Each of the conspiracy charges is punishable by up to five years in prison, and a $250,000 fine.
Defendant Keshishyan is additionally charged with 14 counts of bank fraud, each of which is punishable by up to 30 years in prison and a $1,000,000 fine. The indictment also alleges forfeiture in connection with the crimes charged.

http://www.forbes.com/sites/billsinger/2012/10/29/citibank-and-casino-cash-gone-in-60-seconds-and-bad-guys-comped/

Friday, October 19, 2012

Tribal Gaming Enterprise Held Ineligible to File for Chapter 11



From: NoPlainvilleRacino

Tribal Gaming Enterprise Held Ineligible to File for Chapter 11



by Cadwalader - Financial Restructuring
9/25/2012

Posts by Scott J. Greenberg, Michael J. Cohen, Jeffrey H. Taub

Since the passage of the Indian Gaming Regulatory Act in 1988, casinos owned by Native American tribes have proliferated across tribal lands and have generated billions of dollars in revenue annually. While casinos such as Mohegan Sun and Foxwoods are among the largest and well-known tribal casinos, over 60 exist in the State of California, where many dozen small properties have sprung up throughout the state in recent years, in some cases built in part with the proceeds of high-yield bond debt. This recent growth spurt juxtaposed with the prolonged downturn in consumer spending has clearly demonstrated that numerous tribal casinos, like their mainstream competitors, are overleveraged and need to restructure their financial obligations in order to sustain their operations.

But restructuring a tribal casino differs significantly from the typical casino restructuring. Creditors of non-tribal casinos can use the threat of foreclosure and involuntary bankruptcy to influence negotiations that include outcomes such as creditors receiving equity in the restructured casino in exchange for their claims, subject to regulatory approvals or appropriate structuring. However, a tribal casino’s creditors cannot take a lien in tribal property; thus, their collateral is usually limited to personal property and their remedy-enforcement options are correspondingly limited. In light of a tribal casino’s potential assertion of the sovereign immunity defense, even in cases where credit documents include seemingly adequate waiver language, these remedy-enforcement limitations also extend to the forum and manner in which creditor can exercise such remedies.

Under the unique and somewhat unclear legal landscape in which tribal casinos operate, many tribes have wielded the threat of sovereign immunity or have rested on the leverage inherent in the limited remedy-enforcement options available to their creditors. Despite such assertions of leverage, nearly all tribal gaming issuers have reached consensual restructuring agreements with their bondholders in recent years. Notable deals include, not only Mohegan Sun, but also smaller tribal casinos such as the Chukchansi Gold Resort and Casino, the River Rock Casino and the Buffalo Thunder Casino Resort.

However, the case of the Santa Ysabel Resort and Casino (the "Casino"), operated by the Iipay Nation of Santa Ysabel (the "Tribe”) is an exception to this trend. While the Casino sought to consensually resolve the modest debt on its balance sheet, in the absence of a deal, the Casino ultimately filed for bankruptcy under chapter 11.

In a significant development that provides some clarity on the legal issues pertaining to tribal gaming enterprises, on September 4, 2012, Chief Judge Peter W. Bowie of the Bankruptcy Court for the Southern District of California dismissed the Casino’s chapter 11 case , holding that the Casino was not eligible to be a debtor under the Bankruptcy Code. The court rejected the Casino’s argument that it was an eligible debtor because it was an unincorporated company that falls within the Bankruptcy Code’s definition of corporation and held that the Casino did not bear the characteristics of an unincorporated company because it could not identify when the entity was created. Instead, the court noted that under the Casino’s theory the unincorporated company would have “just sort of [come] up as vapors from the ground after the mist lifts.”
Background

In 2005, the Tribe borrowed approximately $26 million from JP Morgan Chase Bank N.A. and approximately $7 million from the Yavapai Apache Nation (“YAN”) to finance the construction of a resort and casino on tribal land in San Diego County, California (the “County”).

As is typical for tribal casinos situated within the bounds of California counties, the Tribe entered into a memorandum of understanding with the County under which the Tribe paid the County for law enforcement and other similar services.

Due to higher than expected construction costs, only a casino and restaurant were built. In 2009, the YAN purchased JP Morgan’s note, making it the Tribe’s largest creditor. Subsequently, the Tribe failed to make scheduled loan payments and the YAN obtained several judgments in tribal court against the Tribe totaling approximately $43 million which were subsequently recognized in California state court. The Tribe also stopped making the monthly payments due to the County under the memorandum of understanding, and, in May, 2012 the County levied upon the Tribe’s bank account. Faced with a threatened foreclosure action from the YAN, the Casino filed for bankruptcy protection on July 3, 2012. In the declaration submitted in support of its first day motions, the Casino stated that it was an unincorporated company owned by the Tribe.

Motion to Dismiss

On August 8, 2012, the YAN moved to dismiss the Casino’s bankruptcy case, arguing that the Casino did not exist independently from the Tribe and that the Tribe itself was not eligible to be a debtor under the Bankruptcy Code. The YAN argued that Bankruptcy Code section 109 limits eligibility to a “person” and a limited amount of specifically listed entities (that did not apply to the Casino). Section 101(41), in turn, provides that the term person includes individual, partnership, and corporation, but does not include governmental unit. Section 101(27) provides that a governmental unit is a “foreign or domestic government.” The YAN argued that the Ninth Circuit had already determined that Indian tribes are governmental units for the purposes of waiving sovereign immunity under Bankruptcy Code section 106. Accordingly, the YAN argued that the Tribe was also a governmental unit for the purposes of section 109 and was specifically excluded from being a debtor under the Bankruptcy Code.

The YAN also argued that the Casino was not an unincorporated company. Although not defined in the Bankruptcy Code, the YAN cited case law from the First Circuit that requires the entity in question to (i) consist of multiple persons joining together and (ii) provide some form of limited liability for its members. The YAN argued that because the Casino was wholly owned and operated by the Tribe, the Casino could not be an unincorporated company. Additionally, the YAN argued that in its prior dealings with the Tribe, the Tribe never held the Casino out as a separate legal entity. The YAN noted that (i) the Tribe had made several representations and covenants in the loan documentation indicating that it was the sole owner of the casino, (ii) the Indian Gaming Regulatory Act requires an Indian tribe to have the sole proprietary interest in any gaming activity, (iii) the Tribe’s gaming compacts with the State of California and the County of San Diego both required the Tribe to own the gaming operations, (iv) numerous Tribal resolutions described the Tribe as the entity with the sole proprietary interest in and responsibility for the gaming operations and (v) proposed debtor’s counsel had signed an engagement letter with the Tribe – not the Casino.

Accordingly, the YAN argued that the Casino was not a separate entity and the case should be dismissed.

In its response, the Casino stipulated that, if the court found that the Casino was not a separate entity, the court should dismiss the case. However, based on a synthesis of case law from the Second, Third and Seventh Circuits, the Casino argued for an expansive interpretation of the term “unincorporated company” that would include any entity where many people engaged in a business under a common name. The Casino argued that it would fall within this definition because its employees were in the pursuit of a common business objective of operating the Casino and that it operated with its own management and decision-making structure. Additionally, the Casino argued that loan documents were not dispositive because at the time the loan documents were executed, the Casino had not yet begun operations and that the Casino could operate the gaming operations without violating IGRA or the Tribe’s compacts even though the Casino was a separate entity.

On September 4, the bankruptcy court convened a hearing on the motion. In a brief ruling from the bench, the court held that the Casino had not met its burden of proving that it was an eligible debtor.

The court held that the mere fact that the Casino’s employees were acting in concert under a common name was insufficient to create an unincorporated company particularly because nothing in the Casino’s structure provided the employees with limited liability. Additionally, the court noted the importance under bankruptcy and non-bankruptcy law of parties understanding the structure of the entity that they contract with and that entities that wish to achieve the objective of a particular structure should have some characteristics of that structure. However, the Casino had not engaged in any specific activity that would put other parties on notice that it was a separate entity. As a result, the court held that the Casino had not established it was an unincorporated company that was eligible to be a debtor.

Conclusion

Although many practitioners and investors in the gaming sector observing the Santa Ysabel case had hoped for a broad decision on debtor eligibility as applied to Indian tribes and casinos, the court’s decision in Santa Ysabel was narrower in scope in light of its extensive reliance on the unique facts of the case – including the Casino’s lack of formal corporate structure and the Tribe’s prepetition actions. These circumstances led the court to conclude that the Casino was not a separate entity. It remains to be seen whether another court would find that a more sophisticated tribal gaming enterprise whose casino operations are held in an entity with attributes more akin to a traditional corporation could be viewed as separate from its tribe and thus eligible to file for chapter 11 under the Bankruptcy Code.
[View source.]

http://www.jdsupra.com/legalnews/tribal-gaming-enterprise-held-ineligible-76029/

Wednesday, August 8, 2012

Lucrative Gambling Pits Tribe Against Tribe


Lucrative Gambling Pits Tribe Against Tribe

Max Whittaker for The New York Times
Thomas Lozano, an Enterprise Rancheria tribal council member, at Lake Oroville. The tribe’s plan for an off-reservation casino has drawn opposition.

To pull itself out of poverty, the tribe applied in 2002 to build an off-reservation casino at a spot with more economic potential, near towns and highways about 35 miles south of here. After the federal government gave its approval last year, the final decision now rests with Gov. Jerry Brown, who is expected to decide on the fate of the Enterprise casino and another tribe’s off-reservation proposal by an Aug. 31 deadline.

Jim Wilson/The New York Times
The profitable casino owned by the Yocha Dehe Wintun Nation, which has diversified into farming.

But plans for the two casinos are drawing fierce opposition and last-minute lobbying in the state capital from an unexpected source: nearby tribes with casinos that they say will be hurt by the newcomers. Leading the fight against Enterprise is the United Auburn Indian Community, whose casino, Thunder Valley, has become one of America’s most profitable and has brought the formerly destitute tribe unimaginable riches.

“It’s really sad right now in Indian country with the divide between the haves and have-nots,” said Cindy Smith, the secretary of Enterprise’s tribal council. “It’s just a struggle to get on equal footing. And even when you’re on equal footing, you’re really not, because we’re almost two decades behind.”
      
Since Indian gambling was legalized in the United States in 1988, only five tribes have gotten final clearance to build casinos off their reservations. The intense campaign against Enterprise and the other applicant, the North Fork Rancheria of Mono Indians, comes as the gambling market has grown crowded, especially here in California.
      
Opposing tribes accuse the newcomers of encroaching on areas to which they have no historical ties.

“We have other tribes out there doing what we call reservation shopping,” said Brenda Adams, the treasurer of United Auburn. “We played by the rules. We had to stay on our historical lands. They call it equal footing, but is it? We’d like to have a casino in downtown San Francisco, but that’s not our territory.”

The issue has raised larger issues in Indian communities across the nation about the goals of gambling. A decade ago, tribes were united in their efforts to further Indian gambling, which was supposed to give them the means to become self-sufficient, said Steven Light, co-director of the University of North Dakota’s Institute for the Study of Tribal Gaming Law and Policy. But he said that talk of “fairness and justice” has given way in an increasingly competitive market.

A short drive from Sacramento — and about 30 miles from Enterprise’s planned site — Thunder Valley has a 2,700-machine casino, a 300-room hotel, an amphitheater and a golf course. Helicopters fly in high rollers from San Francisco. With 80 percent of its revenues coming directly from gambling, Thunder Valley is so profitable that it has transformed the lives of its owners, the 400-member United Auburn tribe, most of whom received welfare benefits until the casino opened in 2003, said Ms. Adams, 40.

The tribal council has provided housing for members, built group homes for troubled children and connected residential areas to water and sewer systems. All members receive free health care and dental benefits. Children making the honor roll receive hundreds of dollars as incentives. Tribal trips were made to France, Italy and Mexico.

The tribe’s 200 adult members each receive a share of the casino’s revenues, a cut that the local news media has reported as $30,000 a month per member but that industry experts estimate is more.

Douglas G. Elmets, a spokesman for the tribe and a former White House spokesman during the Reagan administration, said only that members did not need to work for financial reasons, but that many did in tribal affairs.

(Page 2 of 2)Another tribe opposing the off-reservation casinos, the 20 members of the Jackson Rancheria of Miwuk Indians, depended on welfare and gathered firewood to make ends meet before gambling, said Rich Hoffman, the casino’s chief executive. Now, the tribe owns real estate in California and Nevada; Goldman Sachs manages the tribe’s portfolio, which is “in the hundreds of millions” of dollars, Mr. Hoffman said.

Still, he was worried that the good times would not last. With the state eager to get a greater share of gambling revenues, Mr. Hoffman said he believed that other forms of non-Indian gambling, particularly online operations, could become legal. “I don’t think the tribes 20 years from now will still have an oligopoly on gaming,” he said.
      
Another small tribe, the 60-member Yocha Dehe Wintun Nation, has used profits from its Cache Creek casino to buy land and diversify into agriculture. The tribe has hired experts to farm 1,300 acres with a dozen crops. Its wine and olive oil, Séka Hills, is sold in San Francisco. Its new multimillion-dollar olive mill, which other olive oil producers in the area have contracted to use, is scheduled to start operating soon.

The tribe, which used to oppose the off-reservation casinos but is now publicly neutral, has felt the need to diversity beyond gambling. “Too many eggs in one basket is probably not a good thing,” said Marshall McKay, the tribal chairman.

Nationally, most tribes, including those with less profitable casinos, remain in poverty, experts say.

So opposition, especially from some of the most profitable tribes, rankles the North Fork tribe, one of California’s biggest tribes with 1,900 members. Of the state’s 104 federally recognized tribes, 61 have casinos in what is the nation’s biggest market for Indian gambling.

“They don’t want to see other Indians prosper, I guess,” said Alvin McDonald, 34, one of a handful of people living on the tribe’s 80-acre tract on the edge of the Sierra National Forest about 200 miles southeast of here.

The tribe is waiting for the governor’s decision on its plans to build a casino on a highway about 35 miles away. Its main opponent, the nearby Picayune Rancheria of the Chukchansi Indians, accuses North Fork of being interlopers from the other side of the Sierra Nevada. The two tribes share many links, including intermarriage.

“That’s what makes it more hurtful,” said Elaine Bethel Fink, 65, the chairwoman of North Fork’s tribal council.
      
Here in Oroville, in the decade that he has fought for a casino, Art Angle, 70, Enterprise’s vice chairman and a retired logger, has lost friends in the opposing tribes — men with whom he had spent a chunk of his life “logging and partying.”

“They don’t look at me in the same way,” he said.

With the final decision only weeks away, Mr. Angle’s worries were turning inward. “I don’t have any money yet,” he said. “I don’t know what’s going to happen in 10 years. I may become as bad as them.”