Thursday, May 30, 2002 | 9:42 a.m.
CHICAGO -- Emerald Casino Inc. operated under a "virtual corporate culture of dishonesty" and all but guaranteed that organized crime would infiltrate a proposed casino in Rosemont, an attorney for the Illinois Gaming Board argued Wednesday at a hearing to revoke Emerald's gambling license.
Emerald attorney Michael Ficaro dismissed the allegations as "vile" and argued that the board has treated the company unfairly because its chairman holds a grudge against Rosemont Mayor Donald E. Stephens.
Both sides presented opening statements in Emerald's appeal of the January 2001 board decision denying its request to build a riverboat in Rosemont, a Chicago suburb near O'Hare International Airport. Las Vegas casino giant MGM MIRAGE later tried but failed to buy the license for the Rosemont casino site.
Board attorney Robert E. Shapiro argued that Emerald officials repeatedly lied to Gaming Board investigators about deals they struck with Stephens and others before lobbying for a 1999 state law that paved the way for Emerald to move its gambling license from a shuttered riverboat in East Dubuque to Rosemont.
Shapiro also said that Emerald executives Donald and Kevin Flynn made a deal to reserve 5 percent of casino stock for people associated with Rosemont or Stephens, then intentionally failed to investigate some investors with alleged ties to the mob.
"The completed deal was one that sealed the relationship with the village of Rosemont," Shapiro said, and "that virtually ensured there would be organized crime infiltration of this casino."
In its complaint against Emerald, the Gaming Board identified proposed shareholders Joseph Salamone and Sherri Boscarino as having ties to mob associates or members. At the hearing, Shapiro flashed a stock agreement showing the name of Vito Salamone -- who the board alleges is known to have mob ties -- crossed out and replaced with the name of his brother, Joseph.
Ficaro accused the board of trying to sway public opinion against Emerald by alleging the company was "mobbed up."
"What a shameless, outrageous, vile allegation without any support whatsoever," Ficaro said.
He said that Emerald and the Flynns had no obligation under Gaming Board rules to investigate potential stockholders, since the board itself had final say on investors. The change on the Salamone agreement was made when Emerald told the brothers only one of them could buy into the casino, he added.
Ficaro also said that Donald Flynn was accused of doing nothing more than buying and selling shares of his own stock -- something he did not do because of a secret deal with Stephens, but because he was a smart businessman reacting to changes in state gaming law.
"I'll tell you what this case is based upon," Ficaro said. "It's based upon abuse of power, revenge, bias and profiteering."
Ficaro alleged that Gaming Board Chairman Gregory Jones blocked the Rosemont casino because he sought revenge against Stephens, who was acquitted of federal tax and fraud charges filed when Jones was an assistant U.S. attorney in the 1980s.
Ficaro also argued that Emerald has been treated much more harshly than other riverboat owners accused of misconduct. He noted that Horseshoe Casino mogul Jack Binion got to sell his Illinois casino at a profit after being found unfit to run it.
"My record and reputation stand for itself," Jones, who did not attend the hearing, said. "I am committed to faithfully carrying out the duties of my office in a fair and impartial manner."
Gaming Board Administrator Philip Parenti said after the hearing that other riverboats were not the issue in the Emerald case. He also said Ficaro did not refute the board's main allegation that Emerald failed to give the Gaming Board information it was required to disclose by law.
Ficaro began his opening statement by calling the proceeding before Administrative Law Judge Herbert Holzman a "kangaroo court" because Holzman is paid by the Gaming Board under rules that allow licensees to appeal board decisions.
Emerald filed a motion seeking to disqualify Holzman. The Gaming Board, which has denied similar requests in the past, is scheduled to meet Monday to consider that motion.
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