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Thursday, May 27, 2010 | 3:28 p.m.
Sun Archives
- Records suggest club kingpin has violent side (3-16-2008)
- Nightclub nightmare costs couple a bundle (3-9-2008)
- Looking the other way (3-9-2008)
- Clubs’ cash flow probed at top (3-1-2008)
- Cubs’ cash flow suspect (2-28-2008)
21st at LAX
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Parents share the unexpected experience of their daughter’s 21st birthday at PURE Management’s LAX nightclub.
More than two years after a raid by Internal Revenue Service agents at the headquarters of Pure Management Group, the Las Vegas company announced today that it has launched a regulatory compliance program to keep it out of trouble with state and county regulators.
In a release issued today, the company, which operates the Pure nightclub at Caesars Palace, LAX at Luxor, Christian Audigier at Treasure Island and other clubs, said the plan was developed “with the assistance, cooperation and guidance of the Nevada Gaming Control Board.”
Pure had no immediate comment on the status of the IRS probe.
IRS agents raided Pure offices in February 2008. Authorities gave no specifics about what they were seeking, but nightclub insiders say the investigation focused on the common practice of employees’ soliciting tips from patrons to get inside the crowded clubs and whether all of those tips had been reported to the IRS.
Many of the tens of thousands of patrons who go to Pure, LAX and other clubs on the Strip each week learn quickly that they must wait for hours in line to get inside — unless they slip the doorman cash.
“Pure Management Group is committed to operating its world-class nightclub venues with a continuing focus on providing a premium club atmosphere, while preventing unlawful activities and maintaining seamless coordination with our gaming property partners,” said Pure CEO Ned Collett, who was chief operating officer when the raids occurred, left the company and then was hired back as the top executive.
“We offer visitors to Las Vegas as well as our local community a fun and exciting environment in all of our nightclubs,” he said in the release announcing the compliance program. “We feel that this cooperative relationship with the Gaming Control Board, the Clark County Department of Business License and other regulatory agencies will help Las Vegas retain its status as the premier destination for outstanding nightclub experiences.”
The release said Pure consulted on the compliance committee with MGM Mirage executives as well as the three members of the Gaming Control Board and Jerry Markling, the board’s chief enforcement officer.
Members of Pure’s compliance committee include Collett, Greenberg Traurig attorney Michael Bonner and Jess Ravich, managing partner and head of debt capital markets for international investment bank Houlihan Lokey.
The plan said emphasis would be placed on coordinating Pure’s security personnel management with their counterparts at resort properties. The committee would meet quarterly and make recommendations to Pure’s board of directors. In addition, the committee would maintain regular communications with the Control Board and the Clark County Department of Business License.
Casino companies have become more aggressive in forming independent compliance committees to head off regulatory problems, but the Pure committee is unusual in that it is a casino lessee.
Gaming regulators have called on their licensees to be more diligent in making sure their lessees are in compliance with state gaming regulations and liquor laws.
In addition to the Pure raid by the IRS, the Nevada Gaming Commission has fined the operators of Planet Hollywood for illicit activities at the Prive nightclub and other law enforcement officials have conducted investigations into illegal activities at clubs and pools.
there goes the Uber-money that these guys have been extorting ,,, no more jaguars, 500,000.00 houses, lavish lifestyles,, welcome the real world you greedy people ... ( they gravy train is stopping ,,,feel free to GET OFF !)
Watch the Video!!! OMG it's funny, if you've ever got a table in one of these clubs. I felt like they should have known better and saying "that's the price of an experience...rookies", but after a while it seemed liked they were robbed without a gun. I got a comp table once and can concur that the bus boys actually do take away drinks even if they are half full once you leave the table. It's their job to get up in and out as fast as possible or buy as many $375 bottles as possible. It drove me crazy and I caught on to it pretty fast. Getting a table is not the best thing despite what it looks like. It's VIP at a cost: you can't have fun. You have to stay at the table (like you're a prisoner) to watch the drinks and your bags and then dealing with the bill and the onerous rules (1 bottle X amt of hours) it's out of control. The tipping the doorman made sense, because he makes about $10 bucks an hour, but he needs to split those tips and to top it off they are charging cover! I'd rather wait in line and pay GA just because you will eventually get to the front at a reasonable cost. The club isn't going anywhere. If you dance most of the night you end up not needing a table anyway. You arrive, you drink, you stand around for a bit, then you dance and then you leave. It's not a place to have any type of meaningful conversation.
The long-winded and wordy article should have focused on one central statement: "nightclub insiders say the investigation focused on the common practice of employees' soliciting tips from patrons to get inside the crowded clubs and whether all of those tips had been reported to the IRS."
I want to know what this compliance committee, which sounds like a bunch of old farts who are so far removed from reality, that they either never go to these clubs or never have to grease a palm b/c someone else does it for them, what are they going to do about the practice of the staff soliciting tips?
Companies and governments form so many unproductive committees nowadays and they talk so much, they forget what they were suppose to be accomplishing. Look no further than this BP debacle for example: bunch of over-paid scientists and high-ranking officials with nothing but thumbs and hot air achieving no results week after week on how to plug a hole, even if temporary. This article makes it sound like 4 top heavy committees were formed from other committees and they are all going after one issue and not one single solution is evident from all that effort, according to this article.
thekube - So business conversation on a golf course is not right either I guess... Not to totally disagree with you but lots of biz deals have gone down in our towns nightclubs... just sayin
"Pure had no immediate comment on the status of the IRS probe."
Of course they don't. Because, the people they hired to manage the place, at that time, were told to rake in that money fast and loose, without a care for safety of patrons. They were only interested in making money.
Way back when this happened at Pure Nightclub, there was an employee who stated one night he raked in $22,000.00 on stiffing people for tips to get into the club. And this same employee turned the money into management that night, but only received a very, very small portion of it back as a tip...Pure Management Group (PMG) collected the majority of that $22,000.00 as their own.
And, to make a long story short, that manager was laid off/fired from Pure Management Group (PMG) because of an IRS raid. And charges are still pending.
But these same manager(s) then went over to Prive nightclub at Planet Hollywood and did this same "2 for me, 1 for you" apportion of tips to employees, bottle service fees, any type of fee. Besides the fact they were doing things that were downright illegal and caring less for the safety of patrons. And besides the fact they were attracting criminal elements to come in there.
And in the long run, these same people caused Prive to be run into the ground, thereby causing Prive to be fined severely, along with an incredible amount of fines levied against P-Ho.
And since then, the same people moved on to City Center and the same shenanigans have went on there too. It was so bad, the businesses at City Center hired their own people to chase them out!
Here's the problem....
IT ALL CENTERS AROUND THE SAME PEOPLE!
When are people going to wake up and build some kind of criminal case against these predators!??!?!
It's absolutely unbelievable.
But it's understandable. These casinos/nightclubs absolutely LOVE to hire these predators. Because they rake in the money fast and loose. Without a care for laws, regulations and/or the safety of people. Rake in that money, moh money, moh money, moh money! They when they get found out? Move on and do it somewhere else.
The trend is there. I was able to put this together based upon previous blogs/articles throughout the past few years or so.
The questions is: When will this be stopped?
LV Blvd. = Shakedown Street
IMO, the whole club thing is out of control.
I also get that it is very profitable.
I read somewhere about the many millions the Wynn clubs rake in as profits for example.
hahahahahahahaha..... and we are wondering why Vegas is down??? who can afford that prices??? and the tips? Tips should be earned, not taken for granted! people go through that once, get pissed off, and never return to Vegas
About as underhanded as restaurants mandating gratuity charges --
BTW: is there a bigger criminal organization in America than the "probing" IRS?
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OMG that video was so pathetic.....poor little daddy's girl. Boo freakin hoo. What did you expect?
welcome to reality, club workers. the president that most of you voted because you thought he was "trendy" is going to raise taxes and hire an army of goons to get that money.
AND it's an election year so all the commissioners and cops and district attorneys will be looking for "look how good i work for MY people" photo opportunities so they'll be watching these clubs like a vulture watching a wounded animal.
The trendy clubs are not as trendy anymore.
Personally, they should shut down a lot of these joints that exist solely to extort cash from the idiots who pay. Why, so they can get in and say they "partied with" some Hollywood person that people over 30 have necer heard of. The doormen and bar staff works every night like it's their last (get as much money as possible). Then again, if a fool is willing to pay, why not let them. The IRS should audit all employees of these places and even do undercover stings for those taking huge tips (you know 99.99% is not reported).
Bottle service is a huge scam. The fact that it still exists proves that there are a lot of fools out there. You see them all in line nightly at these places.
I'll go to Toby Keith's or B.B. King's clubs. Just good places with top rate entertainment, great food, excellent service and nobody trying to extort cash from the patrons.
You basically nailed it, Bakersfield.
It's that "I hung out with the beautiful and important Hollywood people" crowd that these dumb nightclubs are catering to. And what gets me is they go in there and you have these "pseudo celebrities" (which is what I call them). People who don't have a talented bone in their body. Examples that have infested nightclubs here are the Kardashians, Paris Hilton, K-Fed, Heidi Montag, Tila Tequila, Criss Angel, the list goes on and on and further on. None of these people possess a talented bone in their body. And I say that reality show stars, which, if you watch their show, basically suck your brains out of your skull and give you nothing in return except an empty head, are NOT talent. These nightclubs hire these idiots to come there, stand there, smile, but admonish them to make sure they don't cross their eyes and look stupid, nor do they want them to text nor look bored, and make sure they wear clean underwear. It don't take talent to do that. Heck, I could do that.
But, like I said in a previous comment, they rake in this money fast and loose..moh money, moh money, moh money...and the casino loves for them to do this too...because they get a cut of it too.
And further, Bakersfield, to add to your comment, Pure Management Group (PMG), that runs the Pure nightclub at Caesars Palace, was raided a couple of years ago. And their offices were raided as well, IRS officials confiscating computers, trying to find that money trail of tips raked in, but not claimed as income. That investigation is still ongoing. With indictments still pending. And it basically centers around thousands and thousands of dollars raked in nightly. And the Government don't see any taxes from it. I don't care if you agree with the Government playing heavy handed on this or not. The reality of the matter is that they want their money. Period. There's no ifs, ands or buts. You rake in money and don't report what you raked in? BAM! They're on you. Don't matter what the enterprise is. That's their job. To look out for the taxpayers and make sure what is going on is fair.
So, these nightclubs are basically zeroed in on the radar of law enforcement more and more everyday. And they are probably going to be slapped severely, fined, with liquor licenses yanked, even perhaps gaming licenses yanked as well as heavy fines levied against casinos. Like what happened to P-Ho.
I would bet that after the furor at Planet Hollywood, and the investigations at Pure Management Group, other companies and clubs are flying pretty straight.
Colin,
How right you are regarding ZERO talent among the "celebrity" crowd that these places attract. Of those you mentioned, the only one I've ever heard of is Paris Hilton, but for the life of me I have no idea what she does besides show up at these parties and get her picture on the front of magazines at the checkstand. Is she an actress? A singer? Who knows, but more important, WHO CARES! One night, Jennifer Anniston (who really is talented) showed up at a local country music club that I frequent. Yes, I was in the same building, yes, I said hello to her when she walked by, but she was generally surrounded by a large group of bodyguards, etc. I never tell people I "hung out" with her, but I know others who were there say exactly that. I was actually much more excited the night Annette Funicello showed up there (that should give you an idea which side of 50 my age is)!
Nothing good comes from hanging out in Las Vegas Nightclubs..