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The reasons for English Harbour’s long-term success are plenty – and so are the reasons why you should check this site out for yourself! The Las Vegas gambling corporation that runs an Indian casino north of Sacramento and wants to open others near Rohnert Park, Chico and Fresno has paid at least $42 million since 1997 to settle allegations of misconduct, including unfair business dealings, fraud and allowing minors to gamble.
Station Casinos Inc. has paid regulatory fines and penalties of more than $4 million to state gambling officials in Nevada and Missouri, a review of documents shows. It has also paid out $38 million to settle one civil lawsuit and undisclosed amounts to settle others.
The company is now facing an employment discrimination and sexual harassment lawsuit filed by seven women who were employed at the company's Thunder Valley Casino in Lincoln (Placer County), a half-hour drive from downtown Sacramento.
Because of the peculiarities of Indian gambling law, Station Casinos has legally operated Thunder Valley since June 2003 even though California gambling regulators have not yet made an official finding of its suitability to do business in this state.
The California attorney general's office is reviewing the company's history as part of a background investigation for the state's Gambling Control Commission, which can grant or deny permission for Station Casinos to operate in California.
Nathan Barankin, a spokesman for the attorney general's division of gambling control, would not discuss specifics or characterize Station Casinos' business practices in other states.
"We have not completed our background check on them. We've started the process, but it's a lengthy process," he said. "We check out all of their business relationships and history, and we do look into their principals as well."
Leslie Pittman, a spokeswoman for Station Casinos, acknowledged the past fines and lawsuits but said such actions are not uncommon in the closely watched gambling business. "We have had some fines, as just about every other gaming company has,'' she said. "We're in the most regulated industry in the world."
A Chronicle review found that, since 1997, Station Casinos' compliance with state and federal laws -- as well as its aggressive business tactics --
have come under scrutiny:
-- Last year, it paid $2.4 million in fines and investigative costs to settle a 87-count complaint drafted by Nevada gambling regulators -- the second-largest fine in Nevada gambling history -- for failing to report to the government every cash transaction of over $10,000 as required by law.
-- It paid $38 million last year to settle a lawsuit by a competitor who asserted that Station Casinos obtained its Missouri riverboat gambling licenses in the 1990s through improper channels and backroom dealing.
-- In 2003, it settled an unfair trade suit by Harrah's Reno for an undisclosed sum after its Thunder Valley casino was accused of misappropriating a list of Harrah's top casino customers.
-- In 2000, it was fined nearly $500,000 by Nevada regulators because one of its executives ran a smear campaign against an elected official.
-- Also in 2000, it paid a $1 million penalty and surrendered its riverboat gambling licenses in Missouri after allegations arose that one of its lawyers sought to improperly influence the Missouri gambling board chairman. In 1997, it paid $550,000 in civil penalties for dumping fill in the Missouri River.
Pittman, vice president for corporate and government relations for Station Casinos, said the company takes such matters very seriously.
"We have been licensed by the National Indian Gaming Commission and Nevada gaming regulators since those fines took place,'' she said. "With 11, 000 employees, you get some bad seeds. It's unfortunate, but we certainly own up to our responsibility."
Pittman noted that Station Casinos, which owns and operates a dozen casinos in the greater Las Vegas area, is one of the biggest contributors to nonprofits in southern Nevada, and it was named this year by Fortune magazine as a top-100 company to work for.
In the top 5
The publicly traded corporation is one of the nation's top five gambling companies, with net revenues of $986.7 million in 2004.
Founded in 1976 by Frank Fertitta Jr., the Las Vegas gambling conglomerate started out as a bingo parlor, then expanded with casinos that cater mainly to local people who live and work in the desert valley. Fertitta's son, Frank III, now heads Station Casinos, which has more slot machines in Las Vegas than any other company. Its holdings include resorts such as the Palace Station Hotel & Casino.
In the mid-1990s, Station Casinos acquired licenses in Missouri to operate riverboat casinos. State regulators hit it with a $250,000 fine in 1997 after a 12-year-old girl was caught playing the slots.
Missouri regulators also investigated allegations that a lawyer representing Station Casinos improperly lobbied the then-chairman of that state's gambling board, federal and state records show. That lawyer, Michael Lazaroff of St. Louis, helped Station Casinos obtain its Missouri gambling license in the 1990s. He received $500,000 in bonus payments from the company without telling his law partners. He pleaded guilty in 2000 to mail fraud and surrendered his law license.
Missouri regulators accused Station Casinos in 2000 of defying its subpoenas for its top executives to testify at a hearing about its gambling licenses. They also accused the company of allowing a 16-year-old girl and two other minors to gamble on its riverboats, of repeated violations of the state's $500 loss limit per customer per excursion, and of falsely advertising the payout rate of its slot machines.
Records show that, while denying wrongdoing, Station Casinos paid a record penalty of $1 million and surrendered its Missouri gambling licenses to settle these allegations. It sold its gambling interests in Missouri to Ameristar Casinos Inc. in December 2000 for $488 million.
Last year, federal securities records show, Station Casinos paid $38 million to settle a lawsuit filed in 2000 by a Missouri gambling company that had applied unsuccessfully for a license to build a casino, hotel and golf course in the river city of Sugar Creek, Mo. That suit by Fitzgerald's Sugar Creek Inc. asserted that Station Casinos had a fraudulent and unfair advantage over its three competitors because it allegedly obtained its license through inside influence and information gained by Lazaroff's numerous contacts with the then-chairman of the Missouri Gaming Commission.
Settlement undisclosed
Station Casinos sued Lazaroff and his law firm to recoup its Missouri losses, and settled for an undisclosed sum.
"We fully expected Mr. Lazaroff to remain in compliance with the law," Station Casinos' Pittman said. "He misled the gaming authorities, he misled his law firm, and misled us."
Station Casinos has also run afoul of gambling regulations in Nevada.
In September, the company paid $2.2 million in fines and penalties, plus $173,621 in investigative costs to settle a complaint by Nevada regulators that it failed to submit to the Internal Revenue Service more than 1,000 documents required for transactions of $10,000 or more at three of its casinos. The law is designed to prevent money laundering. Investigators found sloppy record keeping, but no evidence of crime.
That was Station Casinos' most expensive fine in Nevada, but not the company's only one.
Four years earlier, according to a Nevada Gaming Commission complaint, Station Casinos' was fined nearly $500,000 after its then-executive vice president for government affairs, Mark E. Brown, ran a smear campaign to discredit a county commissioner. The commission had voted against the company's plan to build a new casino in Clark County, Nev., the complaint says.
An anonymous flyer, mailed to about 39,000 residents, accused Clark County Commissioner Lance Malone of accepting more than $100,000 from gambling interests. It featured a cartoon showing a commissioner with dollar bills stuffed in his clothing, and the caption: "You Just Can't Trust Lance Malone."
Malone responded by suing Station Casinos for libel.
Brown then lobbied the FBI to initiate a political corruption probe of Malone, and threatened the county commissioner with an FBI investigation and further publicity if he did not dismiss the lawsuit, Nevada regulators said.
Malone secretly tape-recorded the alleged threats and went to the FBI. In phone calls monitored by FBI agents, Brown threatened Malone to "back off" the lawsuit or face political repercussions, gambling regulators said.
In a six-count complaint, Nevada regulators stated that Brown lied to FBI agents about his participation in the smear campaign. Station Casinos settled the matter by paying a $475,000 fine, plus $23,588 in investigative costs.
In California, meanwhile, the company is free to run Thunder Valley and pursue other casino operations while the state attorney general's office conducts its background investigation.
That's because the tribes are the primary regulators of gambling on their land, said Barankin of the attorney general's office. "State and federal governments are secondary regulators of tribal facilities,'' he said. "If you're approved to do business in Nevada, you're likely to pass muster here in California."
The attorney general has a backlog of casino investigations, such as Station Casinos.
"We have more work to do than we have the bodies to do it with," Barankin said, "and we are working as best we can with the resources we have to conduct a thorough review of applicants."
In Sonoma County, the Federated Indians of Graton Rancheria chose Station Casinos as their partner in a proposed, $400 million casino resort on a 360- acre cow pasture just outside Rohnert Park. Tribal chairman Greg Sarris declined to comment on Station Casinos' track record.
2007 target date
The tribe, which has about 1,000 members whose ancestors were Coast Miwok and southern Pomos with historic roots in Marin and southern Sonoma counties, wants to open the Rohnert Park casino by 2007. But many local residents oppose it, saying the 24-hour attraction would detract from the sleepy town, causing traffic jams and increased crime.
Station Casinos has spent about $24 million toward developing the Rohnert Park project.
The National Indian Gaming Commission is now preparing an environmental impact statement and the Graton Rancheria plans to petition the secretary of the Interior to have the casino site placed in trust as tribal land. The tribe has not yet negotiated a gambling compact with the state.
Station Casinos has also signed agreements with tribal governments to develop and manage two casino resorts in California, including an $80 million casino near Chico for the Mechoopda Indian Tribe of Chico Rancheria, and a casino costing between $250 million to $300 million about 25 miles north of Fresno for the North Fork Rancheria of Mono Indians.
At Thunder Valley Casino, which Station Casinos operates under a contract with the United Auburn Indian Community, former employees sued in November for employment discrimination. Four of the seven female plaintiffs also allege that casino managers sexually harassed them.
"The tribe is doing an internal investigation," said tribal lawyer Howard Dickstein. "Anything that has any merit, we'll deal with."
In 2003, Harrah's Entertainment Inc. sued Station Casinos, accusing Thunder Valley of misappropriating a list of Harrah's Reno casino's top customers. The suit, alleging that a former Harrah's Reno employee took the player list with her when she took a job at Thunder Valley, was settled for an undisclosed sum.

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