Sportsbook Review

Atlantic City casinos oppose PokerStars' plan

By: | Wednesday, March 6, 2013
Snapshot of Atlantic City Club hotel

PokerStars isn't making many friends in Atlantic City. The world's largest poker site has already drawn the ire of the American Gaming Association (AGA), which dubs itself as the nation's leading casino trade association. The AGA has filed a brief with New Jersey's Division of Gaming Enforcement opposing PokerStars' potential purchase of an Atlantic City hotel.

Sportsbook Review.com reported on January 16th that PokerStars' parent company Rational Group US Holdings was on the verge of purchasing the Atlantic City Club Casino Hotel. The deal, subject to regulatory approval, would make PokerStars the first internet gambling company to purchase an AC casino.

The AGA believes that PokerStars' past in servicing US customers following the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 is reason enough to keep them out of Atlantic City. As part of their settlement with the US Department of Justice in July of 2012, a $547 million fine was imposed and PokerStars did not have to admit guilt or wrongdoing.

AGA lawyer Brian Molloy and David Stewart each blasted PokerStars, accusing the company of being "motivated by greed".

The integrity of the gaming industry would be gravely compromised by any regulatory approvals of PokerStars, a business built on deceit, chicanery and the systematic flouting of U.S. law. —AGA lawyers, according to Press of AC.comPokerStars was quick to return comment through spokesman Eric Hollreiser. "These are matters for expert regulators to determine, not self-interested partisans picking a public fight. PokerStars is one of the largest and most respected internet gaming companies because we work closely with regulators and are in good standing with governments around the world.”

The American Gaming Association is the main lobbying voice for US casinos including Caesars Entertainment, who PokerStars previously rebuffed on a business offer, according to Forbes.com's exclusive statement from spokesman Eric Hollreiser: "Caesars Entertainment approached PokerStars and offered to sell us certain assets, such as the Rio Casino in Las Vegas. Caesars suggested that this acquisition would give us a better relationship with Caesars and would help PokerStars gain a license in Nevada. PokerStars declined the offer because we had no plans to acquire another casino in the near term."

PokerStars' desire to establish a foothold in Atlantic City is a no-brainer. The internet gambling bill recently signed into law by NJ Governor Christie allows Atlantic City casinos to conduct internet betting pending the final approval of the state's Division of Gaming Enforcement. Ceasars Entertainment, aware of how PokerStars' dominos were lining up, lobbied to have PokerStars specifically barred under the internet gambling bill. It was ultimately decided by lawmakers to insert language that PokerStars could apply for licensure, but regulators would need to give the OK.

It is no surprise that existing Atlantic City casino operators aren't big PokerStars fans: For years the state saw declining poker revenue as PokerStars continued to skirt US law while raking in hundreds of millions. The gloves are now coming off.

Sportsbook Review will update following the Division of Gaming Enforcement's decision to grant or deny PokerStars' request to purchase the Atlantic City Club Casino Hotel.

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