California’s gaming tribes say they have lost patience with the state enforcing the law as it relates to the Golden State’s 87 cardrooms and they are letting that impatience splash onto other issues, such as online gaming and sports betting.
At the recent California Nations Indian Gaming Association (CNIGA) meeting some of the most power gaming tribes said they planned to oppose any gaming expansion until their concerns are addressed, and threatened to sue the state. CNIGA represents 34 gaming tribes.
Referring to the California Gambling Control Commission and the Bureau of Gambling Control, Bo Mazzetti, chairman of the Rincon Band of Luiseño Indians, was blunt. “It’s time to quit messing around with these guys.” He told the group of about 400 at Harrah’s Resort Southern California, which is owned by his tribe: “Tribes need to get together, file a lawsuit and be done with it.”
Bureau of Gambling Control supervising agent Tyler Burtis defended his agency: “We are doing, as agents, the best job we can for the industry, both the tribal industry as well as the cardroom industry,” he was quoted by Online Poker Report. “That’s what we’re focused on.” He said his bureau’s main job is to fight money laundering and cheating.
He didn’t get into the main issue the tribes have with cardrooms, the issue of the use of third-party-proposition-player that allow cardrooms to skate around a requirement that card games shift dealers among players after every game.
Cardrooms say that if they were required to do that, they wouldn’t be able to stay in business. Which doesn’t get them much sympathy from gaming tribes who feel they should have a monopoly on gaming in the state.
Burtis told Online Poker Report: “We follow orders. My understanding is that the new Attorney General has met with the cardroom industry as well as tribal leaders. I am not privy to what transpired.”
The AG Xavier Becerra has said he plans to review the issue of banked games when the bureau gets a new bureau chief—which is pending.
The two agencies have refused to answer questions from the press about the issue.
One factor that may be holding the hand of the tribes is their appreciation of Governor Jerry Brown, who has been a friend of tribal interests. However, tribal attorney Scott Crowell told Online Poker Report: “But on this issue, they dropped the ball. And we can’t depend upon the Brown administration to correct the situation. So, the tribes are going to take this into their own hands and do something about it.” He added, “The exact form of the lawsuit … the defendants in the lawsuit; those things are all being ironed out. But it’s going to happen.”
At the same time, tying their frustration to preventing a form of gambling from being legalized that they are dubious about to begin with is a good tactic for some tribes that feel threatened by sports wagering.
Last August Rep. Adam Gray introduced a bill to amend the state constitution through referendum to allow sports betting—if the Supreme Court lifts that ban by ruling that the Professional and Amateur Sports Protection Act (PASPA) is unconstitutional. This would require two-thirds of the legislature passing the measure and forwarding it to the voters, who would allow need to pass it by two-thirds majority. The bill died.
Gray’s bill legalizing daily fantasy sports was also tabled. Tribal hostility certainly played a part.
Steve Stallings, chairman of CNIGA, argues that allowing cardrooms to get away with banked games, combined with online gaming and sports betting would make them de facto casinos, which would violate what the voters approved in 2000 when they specified that only tribes could offer Las Vegas style gaming.
Tribal critics of cardrooms also point to the many recent enforcement raids on cardrooms for money laundering and other violations in the last few years, compared to the relatively clean record of tribal gaming.
Cardrooms precede Indian gaming in the Golden State. They originally only offered poker, where players played against each other and the card club collected a “rake” for each hand.
Under pressure from Indian gaming the clubs evolved to where most of them hire firms to provide dealers of a variety of games such as blackjack, baccarat etc., all of which tribal casinos consider to violate their monopoly.
California law continues to prevent cardrooms from have any interest in the funds wagered. They merely oversee the games and collect the fees, which has allowed the industry to grow to $1 billion a year, which is still a fraction of the Indian gaming industry.
As much political clout as gaming tribes have, Stallings points out that to Online Poker Report: “Every cardroom has an assemblyman and senator in their district,” adding “The fact this has gone on for so long and the fact they have built bigger facilities and hired more employees creates a political and economic justification to let this go on.”
