Mohawks fire casino managers

Tuesday, April 18, 2000 | 10:57 a.m.

The tribal council on Monday ousted President Riverboat Casino-St. Regis Management Co., the non-Native American management firm running its year-old Akwesasne Mohawk Casino, in a midnight takeover.

Tribal officials seized all records and revoked the managers' gaming licenses and barred them from the casino.

"There were a number of serious violations," tribal council spokeswoman Rowena General said Tuesday. "There were issues of noncompliance with gaming regulations and serious violations of the tribal compact with the state. There are also questions about the finances."

The 75,000-square-foot casino opened last April to great fanfare but has averaged only half the projected 3,500 daily visitors and taken in just a fraction of the anticipated annual revenues, projected eventually to reach $65 million.

An independent audit discovered a discrepancy in casino revenues, said General, who declined to provide specifics. She said the audit report would be made public after it is completed.

Additionally, management was warned by the commission to install computer tracking devices on the video lottery terminals by April 9 or face a $25,000 penalty. President R.C. ignored those warnings, General said.

The tracking devices are required under the nation's gaming compact with New York state. Each video lottery terminal has a mechanism for counting money, but there is no central system that accounts for how much each player spends and whether the person won or lost money.

The casino operated under a deal with Long Island businessman Ivan Kaufman who invested $30 million. The deal called for President R.C., Kaufman's company, to manage the gaming hall for five years in exchange for 75 percent of the profits. The remaining 25 percent of profits was to go to the tribe. After five years, the tribe would run the casino.

Walter Horn, fired as vice president, said his company hasn't been able to come up with enough cash to buy the tracking devices, which sell for $1,200 per terminal and would have cost President R.C. about $360,000 total to outfit the entire casino.

"The casino is not generating sufficient funds to pay for this system. We've not made a penny on this, and we haven't been paid back a penny. There's a certain inequity here," Horn said. He estimated the casino was losing about $300,000 a month, even despite an extra investment of $10 million to make it a success.

Horn disputed the tribe's right to revoke the license and said President R.C. would fight the decision.

Meanwhile, Chiefs Alma Ransom, Hilda Smoke and Paul Thompson formed a board of directors to assume operation and management of the casino, General said.

The gaming hall will remain open 24 hours a day and no additional employees will be fired, General said.

The new casino Board of Directors is negotiating a deal to hire Park Place Entertainment to the advise the tribe on running the casino. Park Place is the largest gambling company in the world and the owner of the most profitable casino in Atlantic City.