On Friday, the New Jersey Division of Gaming Enforcement (DGE) released their report regarding the investigation of the PokerStars purchase by Amaya. They also revealed the transactional waiver issued for PokerStars and Full Tilt.
These documents covered the reasons why they agreed to the license and certain conditions that the company must meet before they can operate in New Jersey. These documents set a couple of important precedents regarding PokerStars that we believe other states will follow. Also, the DGE has played the role of bad cop in making PokerStars an acceptable entity for regulation in the United States.
PokerStars Will Pay, Or Rather Repay Funds From Former Customers
One interesting condition of licensing that the DGE imposed on PokerStars is that they must forfeit any unpaid funds sitting in former NJ accounts to the state. PokerStars repaid over $5 million to NJ players after Black Friday but still have $427,000 in funds that have yet to be claimed.
New Jersey requiring those funds to be turned over to the state sets an interesting precedent that other states should also adopt. How much money is still owed to former California players from Black Friday? This money should either be returned to players or forfeited by the company as cost of doing business in the regulated market.
Complete Transparency is Necessary Going Forward
If you look closely at the conditions in the transactional waiver for Amaya, you will notice that the DGE has placed themselves in a position of overseers. Everything that the company does from this point forward regarding iGaming in New Jersey and within the United States must be shared with the DGE.
Some might view this as an overstepping of authority but if you think about it, this makes a lot of sense. The Amaya-run PokerStars is trying to convince the world that they are a new company and the only way that anyone is going to really believe them is by closely examining every move they make in the regulated market.
This is another precedent that we believe that other states may adopt in order to provide oversight and calm the nerves of other operators. It will be hard for PokerStars to operate inappropriately if their every move is watched and scrutinized by regulators. Regulators have become Amaya’s Big Brother in New Jersey and other regulators will step up and do the same in other states.
If You’re a Pre-Black Friday Bigwig – Get to Steppin’
New Jersey acted as the bad cop for the rest of the country in their conditions for licensing. First, they provided a complete list of individuals who are not allowed to be involved with PokerStars in any way. They cannot even contact PokerStars or Full Tilt employees without letting the DGE know of the contact.
The list of employees includes Ray Bitar, Isai and Mark Scheinberg, Pinhas Schapira, Nelson Burtnick and pro poker players Rafe Furst and Chris Ferguson. Furthermore, four additional employees that are still employed by Amaya that were deemed unsuitable for their involvement with the old PokerStars regime must also be terminated by January 31, 2016 or PokerStars will not be allowed to operate in the state.
The DGE effectively laid down the law on which people are not allowed to associate with Amaya and proceeded to clean house of undesirables. They should be praised for this as they made things easier for other states when it comes to vetting the company. Those that are not suitable for regulation have been removed, leaving PokerStars and its executives in the clear to operate in the United States.
Photo courtesy of ppa.org.