Pala Interactive In The News

New Jersey’s decision on Pala Interactive sends a mixed message

By: Hartley Henderson - Exclusive to OSGA.com
Published: Dec 1, 2014

Last month the New Jersey Division of Gaming Enforcement (NJDGE) gave the Pala Band of Mission Indians a license to offer online poker in New Jersey in partnership with Borgata and with the license they had to determine whether Jim Ryan, the CEO of Pala Interactive was a "bad actor". They stated that New Jersey had no concern about Jim Ryan and his history with Excapsa Gaming claiming that Ryan never violated the UIGEA and he was in no way connected to the cheating scandal at UltimateBet. The decision has many, including myself, scratching our heads because it is inconsistent with other decisions the DGE has made. To understand the whole situation it's important to look at Ryan's history in the industry.

Read Full Article Here-->New Jersey’s decision on Pala Interactive sends a mixed message

Also:

Real-Money Gaming Operator, Pala Interactive, Retains KCSA Strategic Communications as PR Agency of Record

Pala becomes first tribe to launch Internet gaming site in N.J.

Pala Interactive live in New Jersey with Palacasino.com

Ten-time bracelet winner Phil Ivey took to Twitter to congratulate Pala Interactive on its successful New Jersey launch.

Pala Interactive

NJ: No proof that Pala CEO knew of cheating

Wayne Parry, Associated Press · November 20, 2014

ATLANTIC CITY, N.J. (AP) – New Jersey’s chief gambling regulator says a preliminary investigation has found no proof that the CEO of a tribal Internet gambling company was involved in or knew of an online cheating scandal at a previous job.

David Rebuck, director of the state Division of Gaming Enforcement, said Jim Ryan, chief executive of Pala Interactive, was CEO of a company whose software was used to cheat online card players in 2006. Pala started offering Internet gambling in New Jersey this week, the first Indian tribe to do so.

In a letter posted on the division’s website Thursday afternoon, Rebuck said an investigation of the UltimateBet scandal determined that it occurred while Ryan was head of Excapsa Software. That firm’s software was used to cheat players by revealing their hidden cards to other users, resulting in losses of nearly $20 million to players. The money was ultimately refunded. But the software was actually developed by a different company that pre-dated Ryan’s employment at Excapsa, according to the report.

“I had no knowledge of it, was not involved,” Ryan told The Associated Press. “It was incredibly regrettable. It was a pretty sophisticated scheme.”

His current company, Pala Interactive, began a test of its new software this week in New Jersey. The company is owned by the California-based Pala Tribe of Mission Indians. The company expects final approval over the weekend to launch its full palacasino.com site on Monday. Ryan said the software Pala is using in New Jersey now is different and has been tested by the state.

Full Article: NJ: No proof that Pala CEO knew of cheating

Bad Actors - Not Just For Movies

If you have been following the push to get Online Poker legalized in California over the past year or so then you have probably heard something about a "bad actor" clause being added to the proposed legislation.  This language in various forms of the proposed legislation has been backed by several tribes including Pala.  The purpose is to ban certain "bad actors" from participating in California's Online Poker market in the event legislation is passed making online poker legal in California.

So who are the bad actors some tribes are trying to ban?  Well, it goes back to something dubbed "black friday" where 3 of the largest online poker operators at the time were indicted by the U.S. Government for violating the Unlawful Internet Gambling Enforcement Act (UIGEA).  These companies are PokerStars, Full Tilt Poker and Cereus (Absolute Poker/Ultimatebet).

The U.S. Government ended up dismissing the cases against PokerStars and Full Tilt Poker with prejudice and settling out of court.  I am not sure what the status of any suit against Cereus is.

What makes the bad actor clause curious to me is what was reported in a previous article titled:

BWIN.PARTY SLUMPS ON REVENUE WARNING; RYAN’S CALIFORNIA TIE-UP RAISES EYEBROWS.

July 10, 2013

X-BWIN.PARTY CEO JIM RYAN’S PALA INTERACTIVE JV RAISES EYEBROWS

Bwin.party shed some more legal baggage last December when former co-CEO Jim Ryan (pictured above) agreed to walk the plank rather than complicate Bwin.party’s pursuit of various US gaming licenses. While Ryan said at the time that he was looking forward to spending more time with his family in Canada, he has since resurfaced at the head of Pala Interactive, an online gambling joint venture with California’s Pala Band of Mission Indians. For the moment, the business is entirely speculative, as the Golden State struggles to reach consensus between legislators and stakeholders in order to make online gambling a legal reality.

PokerFuse reported that Pala interactive intended to offer both online poker and casino games in California, which is odd, since none of the state’s recent draft bills envisioned anything other than a poker-only system. Odder still is the fact that Ryan has found common cause with the Pala band, whose chairman Robert Smith has been very vocal about prohibiting so-called ‘bad actors’ from ever participating in a regulated online gambling system. In May, Smith signed his name in support of a draft bill that would bar any company, individual or software that accepted US customers not just post-UIGEA, but at any time, from California’s regulated online market.

Can Smith really be unaware that Ryan was once head of Excapsa, the parent company of Ultimate Bet, a poker outfit that continued to accept US customers right up until the US Department of Justice pulled the rug out on Black Friday? While Ryan had by then moved on to head up PartyGaming, public documents confirm that he was still calling the shots at Excapsa months after the UIGEA was signed into law in October 2006. What’s more, Ryan presided over Excapsa during UB’s infamous cheating scandal and the ensuing coverup, and Pala Interactive apparently intends to use the same Realtime Edge software that allowed Russ Hamilton and others to cheat other players out of millions of dollars (although the software’s ‘god mode’ has since been patched to prevent a recurrence).

Read More Here - BWIN.PARTY SLUMPS ON REVENUE WARNING; RYAN’S CALIFORNIA TIE-UP RAISES EYEBROWS

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So I guess who is a bad actor and who is not is really a matter of perspective and business deals.  To me it looks like some tribes are just trying to block potential competition from entering the State rather than truly looking to block bad actors.

Even more curious is why Robert Smith would push a bad actor clause which could risk Jim Ryan's participation in Pala Interactive.  Could Jim Ryan be dubbed a bad actor under the current proposed legislation given the fact that he was once involved with Excapsa?

Oh wait, probably not if you have a hand in proposing and crafting the legislation...

CALIFORNIA REVISES ONLINE GAMBLING BILL; BALLY GETS NEVADA ONLINE POKER NOD

Excerpt:

The bill also changed language regarding a licensee’s ability to partner with technology suppliers. The original clause barring any company that took wagers from US citizens after Dec. 31, 2006 has been amended to exclude only those companies that “knowingly and willfully” engaged in such nefarious antics. The reason for the change is, for the moment, unknown, but it’s been previously suggested by poker blogger Haley Hintze that the original selection of the Dec. 31 date – as opposed to the more logical October 13, 2006 date on which President George W. Bush signed the Unlawful Internet Gambling Enforcement Act (UIGEA) into law – was a way of bringing current Bwin.party co-CEO Jim Ryan in from the cold.

In 2006, Ryan was still at the helm of Excapsa, the parent company of online poker site Ultimate Bet. It’s not precisely clear when Ryan officially fled the Excapsa nest, but the last recorded public document on which Ryan’s name appears in connection with Excapsa was a Canadian court’s approval of the company entering liquidation on Dec. 22, 2006. Bwin.party signed a joint venture online poker deal last month with California’s United Auburn Indian Community, a deal that could have been in jeopardy if the UIGEA signing date was chosen as the ‘suitability’ cutoff. Guess there are some instances in which lobbyists really are worth every penny.

Read Full Article Here - CALIFORNIA REVISES ONLINE GAMBLING BILL; BALLY GETS NEVADA ONLINE POKER NOD


Will this bad actor clause fly?  To me it looks doubtful especially since PokerStars had recently signed deals with Morongo and LA Card Rooms.  Who ever spends the most money will likely win.  What they will win exactly I am not sure...especially since we are not even factoring the anti-online gambling billionaire Sheldon Adelson.