The October surprise for Suffolk Downs, that its casino partner had been linked to organized crime and allegedly plied a high-roller with booze and pills, arrived during an Oct. 2 meeting between Suffolk executive Charles Baker and gaming regulators.
A week before Boston and Revere voters could cast ballots on plans to turn
the racetrack into a resort casino, Suffolk Downs officials appeared Tuesday
before the Massachusetts Gaming Commission, and discussed lessons learned by its
failed partnership with Caesars Entertainment.
“I take everybody at their word, so I’m not saying that anybody deliberately
misinformed us,” said Baker, who said in the future he would seek documents in
addition to verbal briefings from potential partners.
Baker said while vetting Caesars, he read a Wall Street Journal article about
Terrance Watanabe, a high roller who racked up $14.7 million in debt during four
months in 2007 at Caesars’ Las Vegas properties, while staff allegedly “plied
[him] with liquor and prescription pain medication,” and did not discourage him
from making unwanted sexual advances to casino workers.
Baker said Caesars officials said they were resolving the allegations with
Las Vegas regulators, and said he knew nothing of the company’s dealings with a
man tied to Russian organized crime, even though Caesars had communicated with
Spectrum Gaming investigators working on behalf of the Gaming Commission in
“Caesars knew full well that this was a serious matter,” said attorney Tom
Reilly, the former attorney general, who was hired by Suffolk after Baker
learned what the Gaming Commission investigators had discovered. He said,
“Suffolk was blind-sided by this but acted very quickly to deal with it.”
Suffolk executives said they had no knowledge of Caesars’ involvement with
Arik Kislin, a principal of Gansevoort hotels, whose company Blonde Management
was linked to Trans Commodities, an alleged Russian mob front owned by his
uncle. Caesars had entered a licensing agreement with Gansevoort in Las Vegas,
but reportedly backed out of that deal after the commission’s investigation was
Director of Investigations and Enforcement Bureau Karen Wells said that since
Caesars has withdrawn from the application, she recommends a suitability finding
for all the other Suffolk executives and owners, who are currently seeking
another casino partner to join the development.
“We are very far along in design and construction drawings,” said Baker, who
said Suffolk is meeting with gaming companies that have applied to do business
in Massachusetts as well as companies that have not sought Massachusetts
licensure and said he “fully expects” to identify a casino partner before the
Dec. 31 phase two application deadline.
“Understanding the matter you just went through, are there additional steps
in your due diligence that you’re taking?” asked Commissioner Bruce
“As you might not be surprised, I’ve spent a lot of nights sort of thinking
about what we might have done differently in this event, and given that, there
are some things we’re doing that are a little different,” said Baker, who shares
a name with a gubernatorial candidate. He said Suffolk would “insist that all
relevant documents be turned over to us.”
Baker also said the parting with Caesars is “amicable.”
“This is a uniquely vulnerable industry,” said Commission Chairman Stephen
Crosby, who advised the developers, “There is nothing more valuable than someone
whose job it is to say the unpopular thing.”
The uncertainty could extend into Election Day, Nov. 5, when Suffolk is
scheduled to seek voters’ approval for a resort casino near Revere Beach, even
without a casino partner.
Commissioner Ed McHugh noted Caesars brands are included within the host
community agreement voters will be asked to approve.
“There’s actually a commitment to build a World Series of Poker room or
rooms,” McHugh said.
“We will have a poker room of that standard and that quality,” Baker said.
The commission planned a second meeting Tuesday afternoon to discuss next
Suffolk Downs has reached out to the voting public to inform people of the
situation, Baker said. An explanatory ad produced by the race track aired during
the World Series.
The plans for 4,000 jobs, deals with local vendors and nearby entertainment
entities would remain the same with the new partner, as would the architectural
Some have previously commented skeptically about the $1 billion revenue
projection contained in the host community agreement, including casino opponent
and former mayoral candidate Bill Walczak, who said in a statement, “This
projected gaming revenue number is ludicrous. This casino will have to clear
more revenue than any casino in the Western Hemisphere.”
Steve Wynn, who along with Foxwoods, is competing against Suffolk Downs for
the eastern Massachusetts casino license, previously expressed concern to the
commission about the level of scrutiny applied by gaming investigators outside
the Bay State’s jurisdiction.
“We're scared to death, chairman. We're scared to death, not that you won't
pick us, but that you will,” Wynn told the commission on Oct. 17, just before
Suffolk cut ties with Caesars.