California has proven to be one of the most turbulent gaming industries. Whether it’s their six year long trek towards online poker, the hundreds of card rooms and casinos that dot the Golden State, or the numerous competing interests, it’s never boring for anyone covering gaming in California.
And it certainly wasn’t boring this past week, as there was big news on both the land-based and online fronts.
On the land-based front, California regulators shut down a card room after it was discovered they lacked the proper funds to cover the chips in play.
Obviously a major no-no.
Meanwhile, a California tribe took a huge step towards launching an online gaming site… and no, I’m not talking about the “tribe who cried wolf.” The Santa Ysabel tribe and the launch of their online bingo site, which of course was followed by their insistence that online poker “is coming soon.”
IN CASE YOU MISSED IT…Check out this ground-shaking news from earlier in the week: San Manuel Band of Mission Indians Join PokerStars Faction in California. This could be a huge momentum boost for PokerStars fighting “bad actor” clause supporters in California.
Pala Granted an iGaming License in New Jersey
As I said, the big news in California online gambling last week wasn’t the launch of Desert Rose Bingo by Santa Ysabel. The big story actually happened far away from California, some 3,000 miles away in fact, as the New Jersey Division of Gaming Enforcement (NJ DGE) approved Pala Interactive for a transactional waiver which will allow them to offer online gambling in New Jersey.
The license is almost a year in the making for Pala, as they applied before the industry launched last November; were approved for a transactional waiver; but never found a partner. Now a year later Pala Interactive has teamed up with Borgata in New Jersey (Pala will operate under Borgata’s iGaming license), but will not be part of the main Borgata/partypoker network in the state.
It’s an interesting dynamic on a number of levels, as Pala’s New Jersey online casino is expected to launch within a couple of weeks, with their poker room expected to launch in early 2015, and both will compete directly with Borgata’s rooms.
You can read more about Pala’s New Jersey license here: Can Pala Interactive Make it in an Already Crowded NJ iGaming Market?
It’s also an interesting move by the tribe, especially considering the size (or lack thereof) of the New Jersey online gambling market, which is about to get even more crowded and competitive when PokerStars enters the picture.
But perhaps Pala’s interest in New Jersey is with an eye towards California? Perhaps the tribe sees the NJ market as a chance to trial their product while they wait for California to pass an online poker bill, which would give them an experiential leg up on their potential competition in California.
It also raises the question of whether or not Pala will now fight to remove any clauses that may be included in a potential California online poker bill that would disallow interstate compacts – thus far all online poker talk in California has been intrastate.
Or, perhaps Pala simply sees an opening to get their foot in the door in a new market and help position themselves for the future; a future where iGaming may be legalized nationally, or interstate compacts readily available.
Casino Royale Shut Down by California Regulators
While Pala was busy securing an iGaming license, a card room in Sacramento was in the process of losing their license.
In a scene reminiscent of what players went through on Full Tilt Poker, Absolute Poker, and UB following Black Friday, the Casino Royale card room in Sacramento, California was shut down by the California Bureau of Gambling Control after it was discovered the property didn’t have enough cash on hand to cover the “chips in play, the players’ banks, the player-funded jackpots and house-funded jackpots,” according to a report in the Sacramento Bee.
Bureau officials were first alerted to the potential problem after a patron won $62,000 at the card room’s Pai Gow Poker tables, but was only paid $20,000 and told to come back later for the rest – An awfully strange request by a casino.
When the Bureau investigated they found the casino to have a shortfall of over $268k , and after giving them 10 days to get their finances in order the Casino Royale was still short some $55k.
The CBGC will now conduct a full audit of the property and a motion has been filed to revoke the licenses of Casino Royale owners James Kouretas, William Blanas and Faye E. Stearns.
The shuttering of the small casino of just 15 tables likely signals the end of the Casino Royale, considering the club has had a tumultuous history since opening in 2008, including the owners suing one another according to the SacBee:
“Blanas sued Kouretas earlier this year, alleging that he shredded casino documents and siphoned off casino funds for personal use.”
The massive shortfall should also be the genesis of a serious CBGC investigation into all of California’s card rooms and casinos, of which there are over 100. But, considering the recent lawsuit filed by William Blanas against James Kouretas, this seems to be more of an isolated incident effecting only the Casino Royale.
