In Nevada, the Culinary Workers Union has officially asked the United States Securities and Exchange Commission (SEC) as well as the NASDAQ bourse to investigate whether the brothers in control of American casino operator, Red Rock Resort Incorporated, Frank and Lorenzo Fertitta, may have a conflict of interest.
According to an official Wednesday press release from the union, the two businessmen also have significant stakes in Los Angeles-headquartered investments firm, Fertitta Capital, but have so far failed to make these holdings known to those owning stock in Red Rock Resort Inc.
The statement from the Culinary Workers Union alleges that this lack of clarity may have led to investors in Red Rock Resorts Incorporated losing out on a business opportunity after February saw Fertitta lead a Series B funding exercise that raised some $17.5 million for sports media firm The Action Network Incorporated. This New York City-based enterprise launched in January of 2018 and currently offers a free mobile application that enables users to track wagers, receive betting alerts and investigate how much cash is being staked on each side of a particular contest.
Zachary Poppel, from the Culinary Workers Union, revealed that this alleged conflict of interest may also run to Michael Britt, who holds the post of Government Relations Senior Vice-President for both Red Rock and Fertitta.
The Nevada union used the press release to detail that it has now asked the SEC and NASDAQ to determine if this potential conflict of interest should be disclosed to investors in Red Rock Resorts Inc and whether the Las Vegas-headquartered casino operator’s competition with The Action Network Incorporated in the sportsbetting sector ‘means the family firm receives opportunities owed to shareholders.’
Poppel’s statement read…
“Both the SEC and NASDAQ have rules promoting fair disclosure and ethical handling of business opportunities. But when it comes to Fertitta Capital, Red Rock Resorts Incorporated investors may have a hard time knowing where loyalties lie and if the company is enforcing its code of ethics.”
Through its majority interest in Station Casinos, Red Rock owns and manages some 21 properties spread across Nevada and California including the Palms Casino Resort. The online news domain at CalvinAyre.com reported that March saw the firm host an event for The Action Network Incorporated at this property while detailing that the Fertitta brothers are additionally cousins to the billionaire businessman behind the nearby Golden Nugget Las Vegas, Tilman Fertitta.