Last Wednesday, the Palomar Card Club of California was raided by FBI agents after an investigation found the venue was operating illegally. The operator of the casino, Naseem Salem, is accused of not reporting winnings as well as being charged with conspiracy to launder money. Now local media are reporting that Salem did not have permission from the city to operate the card room.
Salem has yet to comment on the charges but has entered a plea of not guilty in federal court. Marc Carlos, A criminal defense attorney for another individual associated with the case, spoke to NBC7 earlier this week, they report he discussed the time frame in which the FBI had been investigating the venue. Carlos says that they had spoken to officials over a year and a half ago, and since then the investigation has continued into the card rooms. Carlos stated the FBI took their time, were methodical and have information they feel is necessary for the case and are moving forward.
The current permits of the city ordinance prevent the ownership or control of the card room from being transferred, if they are not already grandfathered in. The Palomar Card Club official owner is Donald Staats, an individual who has control of one of just two card room permits left in San Diego that are non-transferable. This is due to a sunset provision of 1985 that was created to eventually eliminate card rooms of the city.
In early 2014, the Palomar Card Club fought for the right to allow Staats to transfer the control and ownership of the gaming facility. Alan Ziegaus, a public relations consultant, presented the proposal to the Smart Growth and Land Use subcommittee for review. Ziegaus was on the staff of Councilwoman Lorie Zapf, who is the chairman of the committee. It was unusual for the proposal to be handled in this manner.
The subcommittee decided to allow the rule change which would prevent Salem from having the right to operate the casino but the proposal never received a full vote from the City Council, so was never officially approved. Zapf was one of two council members who voted in support of the request.