- The brief asserts that PokerStars—the world’s largest online poker site—is a “business built on deceit, chicanery, and the systematic flouting of U.S. law.”
- The AGA portrays PokerStars as a lawless, “criminal enterprise” that violated the laws of every state, including New Jersey.
- The testimony and subsequent guilty plea of Nelson Burtnick\is also provided as proof of PokerStars’ involvement in criminal activity.
The American Gaming Association (AGA), the United States’ largest lobbying and policy organization representing American casino interests, has filed a brief with the New Jersey Casino Control Commission and Division of Gaming Enforcement, seeking to block the purchase of Atlantic City’s Atlantic Club Casino by PokerStars parent entity Rational Group.
The brief asserts that PokerStars—the world’s largest online poker site—is a “business built on deceit, chicanery, and the systematic flouting of U.S. law.”
It further states that “Any action allowing PokerStars to be licensed would send a damaging message to the world of gaming, and to the world beyond gaming, that companies that engage in chronic lawbreaking are welcome in the licensed gaming business.” And, such a message “could cripple the industry’s public image for many years.”
In 2012, PokerStars settled a massive civil claim brought by the United States Department of Justice, in which it agreed to forfeit a combined total of $731 million for its previous US-facing operations, part of which was used to refund players whose online bankrolls had been frozen.
Included as part of the complex deal was more than $180 million used to acquire the assets of former Stars rival Full Tilt, which ceased operations following the 2011 “Black Friday” crackdown targeting major US-facing online poker sites. Stars and parent company Rational Group admitted no wrongdoing in the settlement, and were cleared by the DOJ to seek US licensure once a proper legal framework was established.
Nearly six months after the settlement, PokerStars parent Rational Group, operating through a new subsidiary called Rational US, entered into an agreement to purchase the small, struggling Atlantic Club casino. The Atlantic Club has lost millions in recent years and faced possible closure, with the potential loss of 2,400 New Jersey jobs.
In its petition, the AGA portrays PokerStars as a lawless, “criminal enterprise” by asserting that since all states require gambling businesses to be licensed by those states, “PokerStars violated the laws of every state,” including the state of New Jersey.
The testimony and subsequent guilty plea of Nelson Burtnick—who served as head of payment processing for both PokerStars and later Full Tilt Poker—is also provided as proof of PokerStars’ involvement in criminal activity.
The brief attacks the suitability of PokerStars and its executives as well. “For many years, the PokerStars individuals and entities operated a business with a history of intentional, uninterrupted criminal violations. They cannot demonstrate the good character, integrity and honesty required by New Jersey law.”
Reactions from the Rational / PokerStars camp were not long in coming. Eric Hollreiser, PokerStars’ Director of Communications, noted on Twitter that, “US DOJ said PokerStars is suitable to apply for a license in the U.S. and gave us the assets of our largest competitor [Full Tilt].”
The AGA represents several of the United States’ largest casino-entertainment corporations, and has recently shifted its support more strongly in favor of US-regulated online poker. Major AGA contributors include Caesars Entertainment, MGM Resorts International, Las Vegas Sands, Boyd Gaming, Pinnacle, and most other giants of the US casino scene.
The AGA is also believed to have lobbied in support of a “poison pill” amendment in Nevada’s recently amended online-poker law which will likely have the effect of blocking PokerStars from receiving Nevada approval for five years, barring a direct legal challenge.
Of secondary consideration is the 2,400 jobs at risk if the Atlantic Club casino were to be shuttered, a possibility if Rational US’s application for a conditional New Jersey casino licensing is denied. The small Atlantic City casino was offered for sale by non-AGA member Resorts International Holdings for several years, with no takers, before Stars agreed to the late 2012, $50 million purchase.