September 1, 2009
New lease on life for Strip landmark
The new ownership group at the Tropicana on the Las Vegas Strip is investing $100 million to renovate the legendary 52-year-old casino and hotel.
Plans call for transforming the Trop with a “South Miami Beach” look and feel, says Chief Executive and co-owner Alex Yemenidjian, a former top executive at MGM Grand, now MGM Mirage, and a confidante of Kirk Kerkorian’s.
Yemenidjian, who ran MGM Studios after leaving the casino industry, took over the Tropicana from bankruptcy reorganization earlier this summer in partnership with Onex Corp., a Canadian private equity firm.
He told the Las Vegas Review-Journal that the first phase of the makeover will include an overhaul of the employee dining room, construction of a new employee lounge and the renovation of all back-of-house and common areas. This work is scheduled for completion by the end of the year.
The second phase, scheduled to begin next spring, includes a convention and exhibition center, a complete room makeover and upgraded public spaces.
The restaurants also will be renovated, and designs are being completed for a new buffet.
“We will be implementing many cosmetic changes in the casino as we go along,” Yemenidjian said, “so the public will certainly begin to notice meaningful changes before the end of the year.”
OHIO LOTTERY REGULATORS APPROVE SLOT RULES— AND TEENS WILL PLAY
The Ohio Lottery Commission has voted unanimously to approve rules on integrating slot machines at the state’s seven horse racing tracks — including a controversial provision to allow 18-year-olds to play.
No one spoke against the rules at a meeting last month, and the Ohio Council of Churches, which has publicly opposed letting teens play, did not send a representative to the August meeting, according to a report in The Cleveland Plain Dealer.
The commission added a couple of amendments, including one requiring track owners and gaming companies to provide greater detail about their financial interests and business affiliations.
Next, the state’s Joint Committee on Agency Rule Review will examine the rules for potential conflicts with state law. A public hearing is tentatively for September 18, and the commission is scheduled to vote September 21 on the final language of the rules.
Gov. Ted Strickland’s administration has urged the commission to move quickly to get the slot machines running by next spring and fill a projected revenue shortfall of $933 million in the current two-year state budget.
BETONSPORTS FOUNDER FACES PRISON TERM AFTER PLEADING GUILTY
BetonSports founder Gary Kaplan, who headed one of the world’s largest Internet betting businesses, pleaded guilty in U.S. District Court in St. Louis to charges of racketeering conspiracy and violating the Wire Act.
The elusive 50-year-old gambling kingpin, who has been held without bail since his arrest at a hotel in the Dominican Republic in March 2007, faces no less than 41 months in prison. He is scheduled to be sentenced in October. As part of the plea agreement Kaplan has forfeited more than $43 million to the U.S. government. The confiscated funds were wired to a District Court bank account from a Swiss bank account prior to the plea.
“Today’s guilty plea should have a lasting effect because Kaplan was not only the founder of BetonSports, he was also one of the pioneers of illegal online gambling,” said John V. Gillies, special agent in charge of the FBI in St. Louis.
The lucrative network of offshore betting operations and related entities tied to Kaplan dates back to the mid to late 1990s and included businesses in Aruba, Antigua and Costa Rica, all designed principally to offer sports betting to U.S. residents through the Internet and a variety of telephone services. Bettors would deposit funds on account from their computers, and the money would be transferred out of the United States to entities Kaplan controlled.
The largest of these, BetonSports, advertised heavily in the United States, claiming its business was legal, and even promoted itself at high-profile sporting events such as the Super Bowl. At its peak the company had nearly 1 million registered customers and handled more than $1 billion in annual wagers.
That all came to an end in 2006 when BetonSports CEO David Carruthers, a British national and former Ladbrokes executive, was arrested by federal agents in Dallas — a move that signaled the start of a wave of federal prosecutions of offshore Web betting operations and payment processors.
Carruthers pleaded guilty in April to racketeering charges and faces up to 33 months in prison. He is scheduled to be sentenced in October.
NEW CHIEF REGULATOR APPOINTED IN MEXICO
Mexico’s Ministry of Interior has a new chief gaming regulator, attorney Maria Guadalupe López Mares, who will be responsible for supervising hundreds of bingo halls and thousands of gaming machines and will lead the fight against illegal gambling in the country.
A politically well-connected member of the center-right Partido Acción Nacional of President Felipe Calderon, López replaces Roberto Correa Méndez as head of the Dirección General Adjunta de Juegos y Sorteos (Directorate of Games and Draws). Correa Méndez resigned under a cloud related to “alleged irregularities” in the operation of his office, according to the left-leaning national daily La Jornada.
López has held a number of high-level positions in the country and with PAN. She is a graduate of Quetzalcóatl University in Irapuato.
COLONY TURNS OVER KEYS, LENDERS TAKE RESORTS
Nine months behind on payments on a $360 million mortgage and facing foreclosure, Atlantic City’s oldest casino, Resorts, has agreed to be taken over by its creditors.
Owner Colony Capital will lose possession of the property, according to a petition released by the N.J. Casino Control Commission and reported in The Press of Atlantic City, but CEO Nicholas L. Ribis will stay on to run it under a management contract with the lenders, led by Column Financial, which won approval to begin foreclosure proceedings back in March.
The takeover is pending regulatory approval by the Casino Control Commission.
W. VIRGINIA’S GOOD NEWS: LOTTERY DOWN A LITTLE, TABLE REVENUE DOUBLES
The West Virginia Lottery is enjoying better results than expected given the state of the economy, according to the state’s lottery director.
For the just-completed 2008-09 budget year, sales of online gaming, scratch-off tickets, video lottery and table games totaled $1.49 billion. That was down 2 percent from the $1.52 billion in sales from the prior budget year, but it was still about $20 million above projections, said John Musgrave, lottery director.
Also, revenue from casino table games at three of the state’s four racetracks doubled, from $15.8 million to $34.2 million, marking the first full year of table games at Mountaineer, Wheeling Island and Tri-State racetracks.
“We’re still holding steady, despite the continuing economic climate and competition from neighboring racetracks,” Musgrave said.
DEALER SUES CAESARS LV OVER EXPOSURE TO SMOKE
A proposed class-action lawsuit has been filed in Las Vegas against Harrah’s Entertainment and Caesars Palace, alleging Caesars isn’t doing enough to protect casino workers from second-hand tobacco smoke.
The lead plaintiff, a female blackjack dealer, worked at Harrah’s-owned Caesars for 20 years before quitting her job in June on the advice of her doctor, according to a report in the Las Vegas Sun.
Her lawsuit, filed in federal court, says pre-cancerous cells were found in her stomach, and that over the years she was exposed to second-hand smoke she suffered other physical problems.
The suit seeks to represent as a class all former, current and future Caesars employees exposed to second-hand smoke.
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