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11 N.J.A.R. 192

Playboy-Elsinore Assocs.; Joanne Marie Rogers, et aL, Division of Gaming Enforcement v
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Citation: 11 N.J.A.R. 192
Decision Date: 1984
Synopsis: The Division of Gaming Enforcement filed a complaint against respondents alleging several violations of the Casino Control Act and Commission .regulations. The matter was transmitted for a hearing to the Office of Administrative Law, where the parties agreed to a stipulation of facts. On motion of the parties, the case was then returned to the Commission for a decision. The facts of the case are similar to those in an earlier case involving the Sands Hotel and Casino. [The decision in the earlier case, Division of Gaming v. Greate Bay and Patricia DiGiacomo, is also included in this volume of N.J./t.R. and is referred to in this decision as the 'Sands' case.] A group of gamblers from Hong Kong spent three days at respondent casino. Upon arrival, they presented $1.9 million in checks as cash equivalents to be placed on safekeeping deposit. The group had an arrangement whereby they pooled funds; the amount credited to each individual therefore did not necessarily correspond to specific cash equivalents and all deposits were recorded as 'cash.' The deposits were accepted in a meeting room, rather than the casino cage area. Some of the checks did not comply with the regulatory definition of cash equivalent. Some of the checks were riot verified before the patrons were permitted to gamble against them. Respondent licensec reimbursed the group for airfare in the amount of $77,400. This expense was not reported in the daily complimentary service report to the Division or in the quarterly complimentary service report to the Commission, although it was included in other reports. In deciding the case, the Commission applied the conclusions and penalties determined in its earlier decision involving the same group of gamblers at the Sands. For accepting cash equivalents outside the cage area, failing to properly record customer deposit forms, failure to verify cash equivalents, accepting non-conforming instruments and failing to report complimentary services, respondent licensee was fined a total of $186,000. Individual respondents, employees of the casino involved in the transactions, were also sanctioned. One issue that was not decided in the Sands case or in any previous Commission decision was whether bank checks made payable to an individual and then endorsed in blank could be accepted as cash equivalents. The commission determined that such instruments are not cash equivalents within the definition of N.J.A.C. 19:45-1.1. A cash equivalent must be made payable to the casino licensee, 'bearer' or 'cash.' A check endorsed by the payee cannot be considered 'bearer paper' because of the effect of a forged endorsement on the validity of the instrument. Because of the strict regulatory limitations on cash equivalent transactions in casinos, the Commission ruled that instruments made payable to a specified payee and endorsed in blank could not be accepted as cash equivalents. In a separate opinion, Commissioner Jacobson said, as he had in a separate opinion in the Sands case, that monetary sanctions against the respondent casino were not sufficient to deter future violations by respondent or other casino licensees. He recommended instead closing the casino for at least 24 hours as an appropriate penalty.
Rule(s) Cited: 19:45-1.1 19:45-1.2(e)3 19:45-1.9(c)1 19:45-1.15(b) 19:45-1.24 19:45-1.25(e) 19:45-1.25(h)5 
Statute(s) Cited: 5:12-99 5:12-101(b) 5:12-129