New Jersey Assemblyman Ralph R Caputo (D-Essex) has launched a stinging attack on PokerStars, labeling it a “disgraced” company with a “history of bad behavior.”
Writing in a guest opinion piece for NJ.com, he warned that Amaya Gaming has purchased the “fruits of a poisonous tree,” in its acquisition of PokerStars from the Rational Group and that regulators should scrutinize the company’s past and present before allowing it to enter the market.
While PokerStars was initially frozen out of the newly-regulated New Jersey online poker market due to its bad actor status, its forthcoming $4.9 billion acquisition by Amaya Gaming appears to have appeased the regulators and paved the way for the world’s biggest poker site to enter the marketplace as a software provider.
Many in New Jersey are welcoming the news, feeling it will invigorate the market, and recent reports suggest that PokerStars and Full Tilt are likely to receive tentative approval to launch in the market, with October 1 earmarked as a launch date.
“A Questionable Firm”
But it’s been too easy, says Caputo, who is deputy majority whip and chair of the Assembly’s Tourism, Gaming and Arts Committee.
Caputo quotes former New Jersey Governor Brendan Byrne, who enacted strict state gambling regulations partly as a means of keeping organized crime interests out of Atlantic City
“While an approval from the Division of Gaming Enforcement would open up a potentially huge internet gambling market to a questionable firm, PokerÂ¬Stars will not even be subject to a public hearing before a decision is made,” he complains.
“While a casino operator is required to go through an exhaustive vetting process,” continues the assemblyman, “as it stands now, PokerÂ¬Stars and its new owner will face no such scrutiny as the online gaming law requires the company to be licensed only as a vendor; a much less stringent approval process and one that does not require any public transparency.”
Caputo draws attention to the fact that, before the announcement of the Amaya deal, the major obstacle to PokerStars’ entrance to the New Jersey market was the presence on its board of founder Isai Scheinberg.
“Fugitive” Scheinberg Will Profit
Scheinberg was one of the 11 people indicted by the DoJ in the wake of Black Friday and remains, Caputo says, “a fugitive.” And while the multi-billion takeover Amaya takeover completely removes Isai Scheinberg and his son Mark from the equation, he notes that the family still stands to gain the “vast majority” of the proceeds.
Caputo quotes former New Jersey Governor Brendan Byrne, who enacted strict state gambling regulations partly as a means of keeping organized crime interests out of Atlantic City, and who famously warned the Mob to keep their “filthy hands off Atlantic City.”
“But new ownership aside, of all the online gambling outfits hoping to get a piece of the New Jersey pie, PokerÂ¬Stars’ hands may be the dirtiest,” he warns.
“PokerStars’ attempt to brand itself with new ownership doesn’t negate the company’s checkered history,” concludes Caputo. “There is no denying the activities that drew indictments from the Justice Department helped build their brand into the gambling powerhouse it is today.
“Any new licensing review of PokerÂ¬Stars must take that history into account as the firm’s way of conducting business threatens to undermine the integrity and public confidence that Atlantic City has worked diligently to build.”