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PokerStars' Hopes of Online License in New Jersey Diminish

A flurry of activity last Friday by the New Jersey Division of Gaming Enforcement (DGE) saw regulators in that state feverishly using their ‘Approved’ rubber stamp in relation to gaming companies seeking permission to participate in New Jersey’s online gambling regime.

DGE officials likely had to moisten their ink pad as gaming licenses were awarded to, Caesars Interactive Entertainment and Gamesys, eGR reported. Transactional waivers to operate in the state have also been approved for the likes of SHFL Entertainment, 888, Bally Technologies, Ongame, Cadillac Jack, Betfair, GameAccount Network, CAMS, Fertitta Acquisitionco, and the All American Poker Network.

Notably missing from the wave of approvals was PokerStars and rumors are circulating that DGE regulators may be preparing to dust off their ‘Denied’ rubber stamp for the world’s leading poker site. Nothing is official yet and more is expected to be known on Friday, November 15 when more licenses will be issued. But several media outlets are reporting that PokerStars may not make the cut.

“Our application remains under review by NJ Division of Gaming Enforcement and we remain committed to working with them to complete the process,” tweeted an optimistic Eric Hollreiser, spokesman for parent company Rational Group.

New Jersey officials are perhaps willing to overlook PokerStars’ actions that saw them continue catering to the U.S. market after the UIGEA was passed by the Bush administration in 2006. What is apparently holding up PokerStars’ approval is the fact that founder Isai Scheinberg remains a fugitive from justice.

Scheinberg was named in the Black Friday allegations with operating an illegal gambling business, money laundering, and violating the UIGEA. The Israeli-Canadian has reportedly not been on American soil for a number of years and likely prefers not to return considering a rendezvous with the feds that includes handcuffs and a jail cell awaits.

But his choice to not face the charges may cost PokerStars entry into the U.S. online gambling market. The company tried to enter via casino ownership of the Atlantic Club earlier this year. That attempt fell flat and ‘plan B’ was a partnership with the Resorts Casino. But that plan is reportedly now in jeopardy and there is not yet any indication if a ‘plan C’ has been mapped out.

Mark Scheinberg, Isai’s son, is listed as the company CEO. But reports surfaced during the failed Atlantic Club acquisition that father Isai was still calling the shots behind the scenes. Rumors have been swirling that New Jersey officials may require both the father to surrender to authorities and the son to divest himself from any interest in PokerStars before giving the greenlight to operate in New Jersey.

Part of the reason that the Atlantic Club backed out of the deal with PokerStars was the belief that the company would not be able to secure a New Jersey license. Many questioned this reasoning at first because the state removed bad actor provisions from its online gambling statute. But now, it seems, the Atlantic Club was privy to more information than the general public was aware of.

Several more gaming companies are being considered for transactional waivers in New Jersey. Paddy Power, Scientific Games, Williams Interactive, Genesis Gaming and Pala Interactive are among them. Approvals are anticipated later this week. But don’t expect PokerStars to be on that list.



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Charles Rettmuller

Charles has been an avid poker player for a number of years, both live and online. He holds a degree in journalism and previously worked as a reporter for a Chicago-based newspaper. Charles joined the PokerUpdate team in early 2012 and writes daily news articles for the site.