Palms $1 rake/$4 promo drop plan turns into chaos, costs house $22,000
NOTE: This thread originally passed along a confidential report from a poker dealer at the Palms that the room manager was playing in the games and reimbursing himself for losses through the promotional pool. However, since then, the manager himself has shown up on this site and defended himself. It is now my opinion that there was no theft involved. However, there are a number of unanswered questions about the situation (including its own legality) which remain. It does appear that the Palms players actually gained overall from the whole thing, as they paid out far more in promotional money than they raked from players. Read below for the original post.
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I lived in Las Vegas for a number of years, and occasionally get contacted by various people I once knew there, regarding scandals and gossip within the poker community.
Today I was contacted by a poker dealer at the Palms, who wanted to remain anonymous. This is not a really close friend of mine, but the guy has always been honest and reliable during the years I've known him. He really wanted to get this story out, but feared for his job if he was named, so he asked if I could post the story.
*** DISCLAIMER *** This is a third-hand report, and I have not verified any of the statements below. I am relaying claims by a third party who works at the Palms, and while I believe them to likely be true, they cannot be considered 100% fact as they have not been checked.
Anyone who knows more they can add to this, please post here.
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First off, it's important to understand that Cantor Gaming runs the Palms poker room. If you're really curious, you can read this article explaining Cantor's relationship to the Palms, but it's not really necessary to understand this story.
The Cantor Poker Manager, whose name I am withholding until this story is verified, allegedly was having the dealers take just $1 house rake and $4 promo rake over the past month or so. Read that again. At the direction of the manager, the Palms poker room was keeping just $1 per hand for itself, and $4 per hand as "promo rake" to be fed back to the players for various promotions.
This appeared to be a great deal for the players, as 80% of their $5 overall rake would be returned to the player pool through Palms promotions.
The dealers found this to be highly unusual. In just about all other poker rooms, the rake situation is reversed, where the house would take something like $4, while $1 would be taken for promotions. It just didn't make sense for the Palms to be taking so little and giving so much back to the players through promos.
However, when dealers questioned it, the manager allegedly told them that he "wanted to create a big fund to establish new business in the room", and that the situation was just temporary. Knowing that it wasn't hurting anyone except perhaps the Palms itself, the dealers reluctantly accepted this weird explanation, and didn't say anything about it.
The players, of course, were thrilled to hear about it. Here's a thread on 2+2 where someone was crowing about it: http://forumserver.twoplustwo.com/10...-drop-1404649/ Note that people didn't even believe the poster, thinking (incorrectly) that he must have had it backwards because the deal was so good.
Note the date of the 2+2 post being January 5 (again backing the story from my friend that it's been going on for about a month).
The dealers started REALLY getting suspicious when the manager himself -- the one who established this weird rake structure -- started playing in these games. When the manager won, he kept the profits. When he lost, he allegedly reimbursed himself out of the promo rake pool!
Of course, the manager still had to justify where the promo rake was going, as it was his job to maintain a log of the rake received at all games. Not wanting to directly admit he was using it to reimburse himself for poker losses, he wrote that he was using the rake he took as 'game protection'.
Finally, Palms auditing noticed this, called and asked him what he meant by "game protection". He actually told them the truth, and was immediately fired.
But here's where it gets really disgusting, if everything I heard is true.
I was told that, effective tonight, all Palms poker promotions have been canceled due to lack of funds! In fact, he took so much from the promo rake pool that the room is now in the red, likely because they already paid out promotions with money that he had already stolen.
The really awful thing here is that the players are the victims. They played for nearly a month, believing that 80% of their $5/hand rake was going to promotions, and now Palms is canceling all of the promotions because their own manager stole the money!
Why isn't Palms restoring the promotional money stolen, eating the loss, and making this right for the players?
The dealers are furious about this. They feel that the players have all been scammed for the past month, believing themselves to have been earning promotional dollars that never came to exist. My friend (who, again, is a dealer there) told me that he and the other dealers didn't know at the time that the manager was playing with promo money, but that the supervisors did know, and didn't say anything about it.
It was said that the manager was losing about $100-$300 every time he played (and rarely won), but did play almost every day. The dealers were led to believe that his losses were being reimbursed, but out of Palms revenue and NOT the players' promo money!
So why isn't Palms or Cantor stepping up, doing the right thing, and replacing the stolen promo money? Both companies can easily afford it, and we're not talking about a staggering amount of money here.
Realllllllllllllllly shady, and someone needs to answer for this.
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Update 8am 2/6: It seems likely that players were paid out a lot of the promo pool, but it also still seems likely that some of the money was indeed stolen in this fashion. Start reading here: http://pokerfraudalert.com/forum/sho...l=1#post226938
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Update 4:45pm 2/8: The poker manager has responded to allegations in this post: http://pokerfraudalert.com/forum/sho...l=1#post227289 ... Read forward from that point, and you will see a number of twists and turns that have occurred since. While I now believe that there wasn't any theft, I do think there are several important questions that are still left unanswered about the situation.
