Officials in California have ordered the shutdown of a Rancho Cordova card room after reportedly determining that it is “seriously underfunded.”
The Sacramento Bee reports that on Monday, Magnolia House Casino was lacking sufficient resources to cover the cost of chips being cashed out by their customers.
“multiple reviews of its finances revealed that it was seriously underfunded“
California Attorney General Xavier Becerra issued the emergency shutdown order against the card room located just south of Highway 50 on Folsom Boulevard, with his office announcing…
“The card room will remain closed unless it is able to demonstrate that it has addressed its funding issues,” according to the Monday report.
Since June, Magnolia House’s management has reportedly received warnings (pdf) from Attorney General Becerra’s office regarding its finances, according to a complaint filed with the state Gambling Control Commission last week.
According to the news agency, Stan Seiff, the manager of the casino, along with majority owner, Thomas B Sheridan, could not be reached for comment, however, an employee answering the phone at the Sacramento County card room said its restaurant remains open for business.
Attorney General Becerra’s office reportedly said…
… “multiple reviews of its finances revealed that it was seriously underfunded, threatening significant losses to patrons and players,” and that among other things, Magnolia House Casino has not been able “to maintain sufficient funds to cover the cost of patrons cashing out their chips,” as reported by The Sacramento Bee.
Furthermore, the casino also neglected to deposit funds via “third-party providers” into separate, specifically designated, accounts, as required by California Code of Regulations, title 11, section 2053, subdivision (b).
Unlike American Indian casinos in the western U.S. state, card rooms there are not permitted to act as “the house,” instead they are required to work with third-party providers who handle the live betting at their tables.
According to the January 2, 2020, Disciplinary Pleading (Accusation, or Statement of Reasons, Statement of Particulars, or Statement of Issues) “Second Cause for Revocation”…
“Respondents’ licenses are subject to revocation in that Respondents used, or converted, players’ funds for Respondents’ own use. Rather than deposit the Third-Party Provider’s funds into a separate, specifically designated, insured account, Respondents commingled the Third-Party Provider’s funds with the Casino’s or Respondents’ funds and used, or converted, those funds for Respondents’ own use. Respondents had a direct or indirect interest in the funds wagered, lost, or won by the Third-Party Provider. Additionally, the Casino has used, or converted, funds from its separate, specifically designated chips-in-use account for Respondents’ own use, including transfers to the Casino’s payroll account.”
Will remain closed until:
According to Patch.com, the casino will remain closed until such time as it has proven that its funding issues have been addressed in compliance with its requirements under the Gambling Control Act and has additionally obtained approval from the Bureau of Gambling Control to recommence gambling operations.
If the card room is not able to rectify the issue, a hearing will be set before the Office of Administrative Hearings where both the emergency closure (pdf) and the accusation will be addressed.
Less than 2.5 miles away, a now vacant building on Folsom Boulevard once housed another card room, Rancho’s Club Casino, which according to its Facebook page closed down in January last year, inviting people to ‘Please visit us at Magnolia Casino.”