The Scoop on Paragon Gaming
Last week Alberta’s new River Cree Resort and Casino, the first Native casino in the province, opened. According to an Edmonton Sun report by Jenny Feniak, the opening of Alberta’s largest destination resort casino began "with the million-dollar invite-only VIP grand opening soiree with 1,500 of Edmonton’s finest patrons in attendance" (see http://www.edmontonsun.ca/News/Edmonton/2006/11/05/2241976-sun.html). The River Cree Resort and Casino is a partnership between Paragon Gaming of Las Vegas and the Enoch Community Development Corporation – a subsidiary of Enoch Cree First Nation, a reserve where unemployment rates reach 65 per cent. According to another article written by the Edmonton Journal’s Jim Farrell the casino revenues will be divided as follows: Paragon Gaming will receive 15% of gambling revenues from the River Cree Resort and Casino, the Alberta Lottery Fund will receive 30 percent, the Enoch Cree Nation will receive 30 per cent and the remaining 10 percent will be set aside for other First Nations in Alberta. The Enoch Cree First Nation Me’Cet Society, a not-for profit society, will also receive 15% and will distribute those revenues to local schools, social development and employment projects as well as towards job training. Revenues from the resort side of the casino will be split 55-45 between Paragon and Enoch (see http://www.canada.com/edmontonjournal/news/cityplus/story.html?id=42c2246c-1b42-473a-9f64-6e8b81577ef7&p=2). I hadn’t heard of Paragon Gaming so I decided to do some research. On the Paragon Gaming website (see http://www.paragongaming.com/about.html), the summary of the company reads: "Paragon Gaming LLC of Las Vegas is a developer and operator of gaming based properties. With extensive experience as both a principal and a consultant, Paragon prides itself in executing all aspects of the gaming industry, including casino management, market analysis, planning and development, financial structure, public affairs, government entitlements and approvals, and securing strategic partnerships. A significant segment of Paragon’s business is partnering with Native American and Canadian First Nation aboriginal groups. Accordingly, Paragon has developed the ability and experience to effectively address the profound social and economic needs of its partners throughout the planning, development and operation of all Indian gaming facilities." Aside from its stake in the River Cree Resort and Casino, Paragon Gaming recently purchased the financially troubled Edgewater Casino in downtown Vancouver, making it the first foreign-owned casino in B.C. It has also built and run the Augustine Casino, a Native American property in Palm Desert, California that opened in 2001; and is developing another Alberta gaming project outside Whitecourt, the $50 million Alexis Casino and Travel Plaza.
Since arriving on the Canadian gambling scene five years ago, Paragon Gaming has been primarily focusing on First Nation gaming projects. The Edgewater Casino, located in the Plaza of Nations that was built for the Vancouver 1986 World Exposition Fair, is the first property Paragon Gaming (or Paragon BC, ULC, a division of Paragon Gaming LLC) has bought as a ‘going concern’ instead of developing and managing it from the ground up [’going concern’ is a nice way of putting it as the former owners of the Edgewater Casino Inc. had been in bankruptcy protection since May, 2006 as a result of $29-million in debts it incurred since it opened in February, 2005].
The Paragon Gaming website goes on to say that "Paragon executives have operated the Sahara Hotel and Casino, as well as the Edgewater Laughlin, Colorado Belle Laughlin, Excalibur, Luxor, and Circus Circus casinos in Las Vegas which were owned by Circus Circus Enterprises. At the time of their construction, the Excalibur and Luxor were leading properties in the Las Vegas market and remain among the most profitable gaming resorts in Las Vegas".
The Paragon Gaming founder and CEO is Diana Bennett, the daughter of Las Vegas gambling pioneer Bill Bennett, who was the former chairman and co-founder Circus Circus Enterprises (now the Mandalay Resort Group). Bill Bennett ’s Gordon Gaming Co. bought the Sahara Hotel and Casino in 1995. Ms. Bennett’s career in the gambling industry began under the tutelage of her father, who was one of America’s richest men at the time of his death in 2002.Paragon Gaming specializes in partnering with Native American and Canadian First Nation aboriginal groups to plan, develop and operate Indian gaming facilities. Its first partnership was with the Augustine Band of Cahuilla Mission Indians of California, near Palm Springs, a tribe that could only claim one adult member.
A brief history of the Augustine Band and the Augustine Casino, which opened in 2002, can be found at The Indian Country Today website (see http://www.indiancountry.com/content.cfm?id=1028034940). This story resembles that of the Pequot Tribe who run Connecticut’s Foxwoods Casino which was established in 1992.
Paragon Gaming gained approval from the National Indian Gaming Commission to operate as the casino’s management company for five years, the maximum time California law allows a tribal casino to employ an outside management firm. Paragon Gaming, after experiencing double digit growth year over year at the Augustine Casino property, turned over the management of the development to the Augustine Board of Directors in July, 2006.
Another earlier proposal by Paragon in 2001 to partner with the Maidu Indian Tribe in northern California to buy acreage at the Channel Islands Harbor in Ventura County and build a 250-room hotel-casino with slot machines and gaming tables was nixed.
According to an article in Gambling Magazine (see http://gamblingmagazine.com/articles/27/27-1049.htm), in order to "comply with legal restrictions on gambling operations, the group [Paragon] proposed to convert the land into an Indian reservation, an increasingly common end-run maneuver."
‘The Watchdog’, a writer of "lineage in the Cherokee tribe" writing in the Oxnard Journal, had this to say about Paragon Gaming’s proposal (see http://www.oxnard-journal.com/arc11.htm):
"How does this poor landless Maidu indian tribe propose to fund such a huge project? This is the point where this story takes a frightening turn. Enter PARAGON GAMING. Paragon is a Limited Liability Corporation that plans to develop gambling projects across the United States and Canada using Native American Indian tribes as a front."
The author goes on to say: "Kudos to Mayor Lopez and Councilman John Zaragoza who wasted no time taking a stand of opposition to the Casino proposal and no doubt see the project for what it really is, a Front for Big Nevada Gambling to grab a foothold in California. Once again, history repeats itself and big corporate money has found a loophole in the system by taking advantage of Native American Indians who will serve as a bona fide FRONT to cloak Paragon’s plans to build full-blown gambling casinos here in California and also nationwide in states where gambling is otherwise illegal. When Paragon left Port Hueneme, they said they would "find an indian tribe" and they did."It appears that the Criminal Code of Canada is not being enforced with regards to private companies, such as Paragon Gaming, operating in the Canadian gambling market (for further discussion of this issue see the document Legalization of Gambling in Canada by Colin Campbell, Timothy Hartnagel and Garry Smith prepared for the Law Commission of Canada at http://people.douglas.bc.ca/colincampbell/gambling.pdf). The Criminal Code of Canada implies that only provincial governments can manage and conduct lottery schemes, which is interpreted to include all gambling enterprises in Canada except horse racing. It further suggests that all profits must go to public good, charities or religious organizations and that no profits can go to private interests, especially US interests.
Nor do Canadian First Nation groups have the same protections afforded tribal casinos in California where outside casino management firms, such as Paragon, can only operate a tribal casino for a period of five years before turning the operations over to the Indian tribe they have partnered with.
Unless the federal laws regarding gambling in Canada are enforced, there will be an influx of what "The Watchdog" calls "Big Nevada Corporate Gambling" in Canada.
by K. Ching
