Casino operator Caesars Entertainment has asked an Illinois judge to “suspend” an involuntary bankruptcy petition filed by disgruntled junior creditors. Caesars is attempting to thwart these creditors from disrupting the planned reorganization of its heavily indebted main unit, Caesars Entertainment Operating Co. (CEOC).

The junior creditors filed in Delaware on Jan. 12 and Caesars made its own bankruptcy filing in Chicago three days later. Last week, US Bankruptcy Judge Kevin Gross ruled that Chicago was the appropriate venue to handle the proceedings. However, Gross declined to rule on the official start date of the bankruptcy, which has ramifications for whether junior creditors can challenge certain financial sweeteners Caesars offered senior creditors for signing on to its reorganization plan.

CEOC is struggling under the weight of around $18.4b in debt incurred when Caesars’ hedge fund owners took the company private in 2008. Caesars has proposed reforming CEOC as a real estate investment trust, a plan that has won the approval of a majority of senior creditors. US Bankruptcy Judge A. Benjamin Goldgar in Chicago has set a Feb. 11 hearing to consider Caesars’ request to suspend the Delaware filing.

Caesars also announced it had “potentially” agreed to allow an independent examiner to consider the legality of Caesars’ controversial pre-bankruptcy asset transfers. Junior creditors have accused Caesars of ‘looting’ CEOC of most of its value by transferring profitable assets – including the company’s interactive division – to other Caesars’ spinoffs (and out of creditors’ reach). Last month, a federal judge described these transfers as an “impermissible” violation of the federal Trust Indenture Act of 1939.

In a filing on Monday, Caesars claimed that any examination of its asset transfers would determine that they were fairly done. However, Caesars said the asset transfers would first be thoroughly investigated by the official creditors’ committee. As such, Caesars asked the court to give CEOC and creditors the opportunity to structure the scope of such an examination.

CAESARS HIRE NEW ANTI-MONEY LAUNDERING WATCHDOG

Finally, Casears announced it had hired a new anti-money laundering (AML) compliance chief. In a statement to Reuters, Caesars announced it had hired Benjamin Floyd as its new senior VP for AML compliance. Floyd, who began his new job in January, formerly held a similar position with Wal-Mart.

Fourth amendment fans got a boost on Monday after a US federal judge said key evidence against accused online gambling operator Wei Seng ‘Paul’ Phua (pictured) was inadmissible. In a 32-page ruling, US Magistrate Judge Peggy Leen said Federal Bureau of Investigation agents had made “false and misleading statements” to obtain evidence that Phua and others were running an illegal online sports betting operation out of three luxury villas at Caesars Palace in Las Vegas.

Phua was one of eight defendants arrested last July following a FBI raid on the villas. Prior to the raid, the FBI had switched off the villas’ internet connections, then, after the villas’ occupants called Caesars for help fixing the problem, sent in agents disguised as tech support wearing hidden body cameras. Using the evidence obtained via this subterfuge, the FBI was able to obtain the necessary arrest warrants.

However, before the FBI executed its scheme, Assistant US Attorney Kimberly Frayn had warned agents that their plan raised “consent issues.” Caesars’ security boss testified that he’d declined to participate in the FBI’s plan due to “privacy concerns.” The agents themselves omitted key details of their scheme in their arrest reports, which Phua’s attorneys claimed was proof that the FBI knew it was violating the US Constitution’s prohibition of unreasonable searches and seizures.

In her ruling, Judge Leen said the FBI’s errors and false statements had rendered their search warrant “fatally flawed” and thus removed any semblance of probable cause to justify the raid. Leen noted that a search warrant “is never validated by what its execution recovers.” Phua attorney David Chesnoff called Leen’s ruling “a triumph for citizens everywhere, showing that courts will enforce the Constitution.”

Chesnoff demanded that the charges be dismissed against Phua and his son Darren, the only two defendants to have not reached plea bargains with prosecutors. The news came too late for defendant Seng Chen ‘Richard’ Yong, who pled guilty in December to being an accessory after the fact for the transmission of wagering information. But Yong just earned more than triple the sum he gave the feds in fines and forfeitures by winning the Aussie Millions’ High Roller event, which he wouldn’t have been allowed to compete in had he still been fighting the charges.

Federal prosecutors will likely appeal Leen’s recommendation, given that they’ve already publicly stated that their case hinges on the evidence seized during the FBI raid. The case is being heard by US District Judge Andrew Gordon.

Legal sports betting shouldn’t be the sole property of Nevada, according to US Senator John McCain (R-AZ). During an interview on Thursday with EPSN Radio (listen here), hosts Andy Katz and Rick Klein asked McCain whether Nevada’s monopoly on legal sports betting in the US was appropriate. McCain said the hosts had “an excellent point and that’s why it is a national issue.”

McCain said he had “no problem” with the idea that states which had already authorized legal gambling, including on Indian reservations, should have the option of offering legal sports bets as well. McCain said “we need a debate in Congress. We need to have a talk with the American people and we need to probably have hearings in Congress on the whole issue so that we can build consensus.”

McCain’s stance will be welcomed by New Jersey’s federal representatives, who have been proposing legislation for three years running that would lift the 1992 PASPA federal prohibition on single-game sports wagers outside Nevada but their efforts have up to now gone largely unnoticed by their Washington peers. The American Gaming Association (AGA) recently stated that the betting prohibition was “clearly failing” and even National Basketball Association commissioner Adam Silver has been beating the drum for a federal rethink of Nevada-only betting.

McCain, a known fan of craps games, qualified his betting support by saying he was against online betting, whether on sports or other forms of gambling like poker (although he does enjoy the free-play variety). McCain also voiced concerns over how to protect gamblers from “corruptive influences that could take advantage.”

Finally, McCain said he’s picking the New England Patriots to win this Sunday’s Super Bowl, noting that he had “mixed emotions about [Seahawks cornerback Richard]. Sherman,” given the Seattle team’s rivalry with the Arizona Cardinals.

Where there’s a will, gamblers will find a way. On Jan. 9, police in Turkey raided the provincial headquarters of a political party, detaining 12 individuals, including the party’s leader Öztürk Sezer. The authorities claim the Raising of the Nationalist Will Party (MIY) is not a political movement but a front for illegal gambling activity, specifically, bingo games.

The raid in Adana province resulted in 238 individuals being fined for gambling offenses, while others were charged with earning money for providing a venue for illegal gambling activity. The Hurriyet Daily News quoted a police official saying they’d found vouchers in the office of MIY’s provincial chief indicating that MIY had paid the fines imposed on gamblers from previous raids.

This was the third raid of a MIY establishment this year and the 11th since it was founded in late 2014. MIY began life following the demise in September of the Trust Party, whose establishments were raided 44 times under similar circumstances. Despite the harassment, Trust would regroup after each raid and carry on as normal, as only the nation’s Supreme Court has the power to completely shut down a political party’s activity.

Following the Jan. 9 raid, Sezer did his best Claude Rains from Casablanca “Shocked!” routine, claiming he was only at the provincial HQ because he was “curious when I read media stories that people gambled in my party. I was waiting for the provincial head and then the police came in.” Turkey’s legal gambling options include a national lottery and some sports betting but other forms of gambling are strictly forbidden.

Meanwhile, the country’s Directorate General for Religious Affairs (Diyanet) has attempted to clarify whether Islam frowns on gift draws. In a fatwa issued earlier this month, Diyanet doubled down on its stance that the lottery is forbidden for Muslims because it involves some people winning money while others lose. But gift draws organized by shops, which require no upfront payment to qualify for a prize, are acceptable.

Shifting topics, the fatwa said Turkish men should stop wearing earrings because it would make them effeminate. Most non-Muslims might say the same thing about men playing bingo. But hey, whatever floats your fez.

Eight people have been indicted for running an illegal online sports betting and marijuana trafficking ring in Oregon. Early Wednesday morning, agents of the Federal Bureau of Investigation, the Department of Homeland Security and the Drug Enforcement Agency raided several locations in Portland, arresting the eight individuals, all of whom share Vietnamese lineage.

Among the indicted are Kiet Anh Vo and Vinh Tuong Nguyen. Vo is accused of managing the ring’s password-protected betting site, vnbets.net (pictured), and the group also took wagers over the phone and in person. Vo and Nguyen ran a legit Portland business, the Lava Café, at which the ring’s agents would drop off bettors’ losses and collect cash to pay out winners on a weekly basis.

The other six accused reportedly acted as agents on the ground handling interactions with bettors. The bookies would charge a certain percentage on each wager, the amount varying depending on the bettor and the amount being waged. The ring is believed to have been in operation since April 2014.

The defendants are also accused of purchasing “bulk marijuana from wholesale distributors on the west coast” then shipping it to states on the eastern seaboard, including Tennessee and North Carolina. Cash from these sales would be deposited into accounts linked to the accused and Nguyen would sometimes fly to these states to pick up cash, returning from one trip in August carrying nearly $70k in cash.

The defendants are facing charges of conspiracy to commit money laundering in connection with both the gambling and drug trafficking operations.

A controversial 30-year Stop and Seize law has been amended by Attorney General, Eric Holder; but it’s a little too late for Californian poker players William ‘Bart’ Davis, and John Newmerzhycky.

Attorney General, Eric Holder, has put the cat amongst the police department pigeons after changing the controversial ‘Equitable Sharing’ scheme that gives local and state police the power to seize cash and property from individuals without warrants or criminal charges.

In April 2013, two Californian professional poker players: William ‘Bart’ Davis, and John Newmerzhycky, were driving through Iowa when they were stopped by local State Troopers. The pair – who had out-of-state plates, and were returning home after playing poker in Illinois – were stopped for allegedly failing to signal when overtaking a truck.

The local police searched the car, and arrested the pair, after finding $100,000 in cash, and marijuana – the poker playing pair were about to embark on the roughest 12-months of their lives.

The ensuing investigation led to a search on their Californian homes, and they received felony charges in relation to drug possession (charges that were later dropped after the pair revealed medical marijuana cards). But their $100,000 remained in the possession of the police.

Eventually, $90,000 of the $100,000 was returned, but the pair are believed to have forked out a small fortune on legal fees; Newmerzhycky suffered a stroke, allegedly brought on by the stress of the incident, and neither player could continue to play poker without their bankroll.

The police were allowed to stop and search the pair due to a 30-year program known as Equitable Sharing – a form of asset forfeiture that allows the government to stop people and take their cash and property, without charging them for a crime; only returning the possessions after the owners can legally prove how they acquired them.

The Delaware State Lottery has released its revenue figures for Dec 2014, and once again it’s bad new in the online poker popularity stakes.

As Santa searched through 935,000 Delawarean Christmas letters, there was the usual hodge-podge of requests: new bikes, iPods, PlayStations and Barbie’s; but there were also a few requesting intrastate online poker liquidity.

Those went in the bin.

If there was ever a time for the implementation of the Multi State Internet Gaming Agreement (MSIGA) it is now. If the lawmakers don’t take off the parking brake soon, there will be nobody left in Delaware who wants to play the game – shared liquidity or not.

The State’s online poker revenue, for the month of Dec 2014, came in at $28,589. That was 9.6% lower than the month previous, and a huge 77% reduction year-on-year – proving that once upon a time in a town called Delaware there were a few people who liked to play online poker.

Delaware Park turned in its second lowest total of the previous 13-months with $15,964; Dover Downs also recorded the same stat of hitting their second lowest total with $7,625, and only Harrington did their bit for the team recording their sixth highest return, albeit only $4,999.

It’s not just online poker that seems as attractive to Delawareans as a Kryptonite condom is in the hands of Lois Lane. Total online gambling revenue was $169,606, and that’s the seventh lowest return since the state started recording numbers in Dec 2013.

A group of Japanese lawmakers are set to resubmit a bill legalizing casinos on the next Diet session on Jan 26.

Recently re-elected Japanese Prime Minister Shinzo Abe stated that he will do his best to bolster his country’s economy by means of his suite of measures known as “Abenomics.” and gaming companies such as Las Vegas Sands Corp and MGM Resorts International have publicly shown their interest in investing in Japan if casino gaming is legalized,

However, the bill faces opposition from some members of Komeito, Abe’s junior coalition party, and from some quarters of his own Liberal Democratic Party, who are concerned about the impact of gambling addictions.

Anti-casino lawmakers have also stepped up their campaign, drawing the public’s attention to Japan’s already high rates of gambling addiction, mostly related to pinball-style pachinko games played throughout the country.

Union Gaming Research LLC in the United States has also issued a report on Thursday suggesting that casino resorts will never happen in Tokyo or Osaka by 2020, in time for the 2020 Summer Olympics in Tokyo.

Authors of the report, Christopher Jones and John DeCree wrote: “We are less convinced that the opening of casinos in Tokyo and Osaka would be the right move out of the gate, as those markets do not fit the original reasoning behind the push to legalise casinos in Japan – to spur economic development by encouraging tourism in under-visited regions of Japan.”

“Today, Japan has no shortage of domestic or international tourists to Tokyo or Osaka. Commonly referred to as the ‘Golden Route,’ the route between the cities is taken by more than 90 percent of all tourists to Japan,” they added.

Nebraskan Senator, Tyson Larson, is hoping to generate more tax revenue by proving to the lawmakers that Draw and Hold’em poker are games of skill, and can therefore circumvent the aged-old gambling laws in the state.

The largest city in Nebraska is called Omaha, and yet you won’t find a legal form of the game, with the same name, played anywhere in the state. In fact, you won’t find much gambling at all in the state with the exception of some forms of bingo, lottery and pari-mutuel horse racing.

State Senator Tyson Larson plans to change all that. According to the Government and Political section of the Journal Star, the youngest man to ever become a member of the Nebraskan senate, is set to introduce a bill that will legalize two-forms of poker: Draw and Hold’em.

Larson’s argument will hinge on the premise that the above-mentioned games are ones of skill, and not chance, thus circumventing the decrepit legal jargon currently occupying space in the tea stained official documents.

“You can be a professional poker player; you cannot be a professional coin flipper,” Larson told the Journal Star. “You can lose a poker game on purpose; you can’t lose a coin flip on purpose. You can have the worst hand in poker but be the best player. The math is there; the statistics are there,” he said. “Poker is a game of skill; it is not a game of chance.”

If Larson wants any help, he can turn to New York. In 2012, New York Federal Judge, Jack Weinstein ruled that poker was a game ‘predominated by skill’, during the case of Lawrence Dicristina, who was being charged with the crime of operating an illegal gambling business.

Larson is not only backing a bill to legalize some forms of poker. The young liberal also wants to see bars open 24/7 and the freedom for cigar chomping Nebraskan’s to puff until their hearts pack up in cigar shops throughout the state.

A federal judge has ruled that key elements of casino operator Caesars Entertainment’s proposed financial restructuring likely violated federal law. In a ruling in Manhattan federal court last Thursday, US District Judge Shira Scheindlin (pictured) rejected an attempt by Caesars to quash a lawsuit brought by junior creditors who feel they’re being unjustly treated via Caesars’ financial rebirth.

The creditors had sought to reverse Caesars’ shifting of certain profitable assets out of its debt-laden Caesars Entertainment Operating Co (CEOC) division, thereby shielding these assets from creditors ahead of CEOC’s bankruptcy filing. The junior creditors also protested Caesars’ claim that its sale of 5% of CEOC to undisclosed institutional investors had alleviated CEOC of honoring its debt obligations to these junior creditors.

In her ruling, Scheindlin referred to Caesars’ elimination of its debt guarantees as “an impermissible out-of-court restructuring.” Scheindlin said Caesars’ gambit was “exactly” the type of shenanigans that the federal Trust Indenture Act of 1939 was “designed to prevent.”

Caesars had never denied the factual nature of the plaintiff’s allegations but insisted that the junior creditors had no right to sue because the company had yet to default on its debt payments. But Scheindlin cited a previous case that ruled transferring assets and eliminating guarantees “constitutes an impairment of the right to sue for payment.”

Caesars spokesperson Stephen Cohen sold Bloomberg that it disagreed with Scheindlin’s ruling because it was “based simply on the plaintiffs’ allegations.” With the suit still pending, Caesars has no ability to appeal the ruling unless Scheindlin gives them permission.

Caesars’ plan to convert CEOC into a real estate investment trust has received the support of most of its senior creditors, who would receive equity in the new REIT to the tune of 92¢ on the dollar. Junior creditors holding over $5b in second-lien notes would receive only about 10¢.

CEOC filed for Chapter 11 bankruptcy in Chicago last Thursday (15), just days after junior creditors asked a Delaware Chancery Court judge to push CEOC into involuntary bankruptcy. Shortly after Caesars filed in Illinois, Delaware Judge Kevin Gross ordered the Chicago bankruptcy proceedings to be put on hold to give him time to determine which court had jurisdiction over the matter. None of this affects day-to-day operations at any of Caesars casinos across the United States.