The end of March saw:
- PokerStars’ long-awaited return to the U.S. with PokerStars New Jersey launching.
- Charges of insider trading were brought against Amaya CEO David Baazov, who subsequently took a leave of absence, in the midst of a possible private takeover bid.
- A rake increase for the international market that wasn’t received very well in some corners.
How did we get here? And what’s next for PokerStars, especially viewed through the lens of its brand new NJ platform?
The timeline of events at PokerStars
Here’s the recent timeline of relevant events for PokerStars in general, and PokerStars NJ in specific, over the past several months:
- After years of trying, PokerStars received approval to operate in New Jersey last September.
- Amaya confirmed Baazov’s intention to take Amaya private in early February.
- After months of speculation of when PokerStars NJ would go live, in February the site announced its intentions to go live in March.
- PokerStars NJ soft launched on March 16.
- The full NJ launch came on March 21.
- Insider trading charges were levied against Baazov by Quebec authorities on March 23.
- PokerStars NJ quickly rose to the top of the NJ market in week one after its full launch.
- News that Baazov was taking a paid leave of absence in the wake of the charges came on March 29.
PokerStars and the current NJ environment
The New Jersey Division of Gaming Enforcement put a lot of time and effort into an investigation of PokerStars, its parent company and its executives, according to an NJDGE report issued last year.
It’s not likely the agency went through all of that with the idea it would approve PokerStars for operation, only to yank its license shortly thereafter. However, it mentioned the insider trading investigation in the aforementioned report:
As of July 1, 2015, the AMF Investigation has not resulted in any proceedings and no charges have been filed. Amaya management has issued several public statements stating that the company is confident that at the end of the investigation the AMF will come to the same conclusion as Amaya: that if there were violations of Canadian securities laws, they were not committed by Amaya, its officers or directors. The Division will continue to monitor the AMF investigation.
And, right now, the charges are just that. Baazov has not admitted to any wrongdoing, nor anyone else at Amaya. The NJDGE seems likely to sniff around some more regarding Amaya and Baazov, now that charges have actually been filed.
It’s also important to note, however, that PokerStars only has what is called a “transactional waiver” to operate in NJ, not a full online gaming license.
In a statement on March 30, the DGE stated:
The Division is closely monitoring the matter regarding the insider trading related charges that were filed by Quebec’s Financial Securities Regulator, the AMF, against Amaya CEO David Baazov and other Amaya employees. The Division’s licensing investigation is not yet fully completed. Therefore, Amaya is conducting business in New Jersey on a transactional waiver. As the Division investigation proceeds, we will address this matter with Amaya, the AMF and other licensing jurisdictions.
What’s all that mean for PokerStars and its future in NJ?
So, it appears likely that the NJDGE will sniff around some more regarding Amaya and Baazov, now that charges have actually been filed.
Will that result in a change in the status quo for PokerStars in New Jersey, and the possibility of the site losing its license? We don’t appear to be very close to that scenario, but it does seem like it is a possibility in the future.
If Baazov and others at Amaya are eventually found to be associated with wrongdoing, could PokerStars/Amaya cut ties with those parties and save its New Jersey license? That’s probably in play, too, as the NJDGE told Amaya to cut ties with some employees from the pre-Black Friday days, when granting the transactional waiver. That, however, wasn’t for the company’s CEO.
All of that comes amid the possibly of the publicly traded Amaya still considering bids to take the company private.
Whatever is going to happen in New Jersey isn’t likely to happen quickly. However, PokerStars’ future in New Jersey, which seemed very bright just a few weeks ago, is a lot cloudier.