Former Las Vegas gaming executives work to clear their names

Two years after they were accused of defrauding banks and other counts of wrongdoing, former Las Vegas gaming executives Robert Cucinotta and Karim Maskatiya appear to be making good progress in clearing their names.

In June 2009, the Arizona Department of Gaming recommended Global Cash Access Inc. (GCA) of Las Vegas lose its license to provide ATM, credit and cash services to about 20 casinos in that state because of actions years ago by GCA founders Cucinotta and Maskatiya.

Several states with casinos regulate companies like GCA, but in Nevada such companies are considered non-gaming suppliers and are not required to obtain gaming licenses.

Arizona investigators alleged that from 1999 to 2002, GCA deliberately miscoded some Visa transactions by disguising cash transactions as retail purchases, meaning it would pay a lower fee to banks issuing the Visa cards at issue.

Global Cash made $26 million with this scheme, the Arizona report said. The company was also accused of hiding information about the incident from certain regulators while Cucinotta and Maskatiya were also accused of failing to disclose they had been questioned about the slaying of Maskatiya's wife in California in 1982.

Global Cash ended up settling the Arizona probe to keep its vendor’s license there and the company distanced itself from Cucinotta and Maskatiya, who left the company board in May 2008, by buying their GCA stock holdings.

Arizona’s allegations of wrongdoing against Cucinotta have now been resolved with Cucinotta receiving certification as a vendor on Aug. 8 and him paying $40,000 in civil fines as part of a settlement of allegations he violated a state regulation.

That regulation allows the state not to certify -- or revoke certification for -- a vendor who "Makes a misrepresentation of, or fails to disclose, a material fact to the State Gaming Agency or the Tribe or Tribal Gaming Office."

One of Cucinotta’s attorneys, well-known Phoenix lobbyist Gary Husk, said Tuesday this violation involved an inadvertent failure of Cucinotta to provide certain bank account information.

"The Arizona Department of Gaming has completed the investigations necessary to ensure that you are suitable for state certification as a `key employee," said a letter to Cucinotta issuing him his certification and listing an address for him in Miami Beach, Fla.

Cucinotta now has a company called USA Payment Systems Inc. in Houston.

“This has been a long and arduous process, but I was committed to disproving those who wanted to challenge my integrity. I commend the Arizona Department of Gaming for conducting a thorough and fair background investigation in the face of so many false rumors. I am pleased that the issuance of this gaming license and the decision to rescind the allegations contained in previous reports clearly demonstrate that I am suitable to continue to work in the gaming industry,” said an Aug. 11 statement by Cucinotta, who besides founding GCA founded MCA Processing LLC in Las Vegas.

“As a result of the issuance of this license, USA Payment Systems Inc. is now able to provide our exceptional processing services to the Arizona gaming community,” Cucinotta said in the statement.

As for Maskatiya, the Arizona agency in February issued him a temporary certification and an investigation for a permanent certification is continuing.

Maskatiya has also entered into a settlement with the Arizona agency, but details of that settlement have not yet been disclosed.

If Cucinotta and/or Maskatiya are involved with an Arizona tribal gaming vendor, they and that entity must adhere to a compliance plan and allow the agency to audit the vendor to ensure compliance with the settlements, Arizona gaming documents say.

Husk, their attorney, said Cucinotta and Maskatiya sought state certification and went through a lengthy investigative process not necessarily so they could participate in the Arizona casino industry, but so they could clear their names.

Husk said Maskatiya is no longer involved in the gaming industry while Cucinotta hasn’t shown any intent to actually operate in Arizona.

"The prior allegations were rescinded," said Husk, who has a company called Husk Partners. "It was done to address the concerns in the first report that were completely inaccurate."

Cucinotta and Maskatiya, in the meantime, are involved in a second legal effort in Nevada involving what they call false allegations against them.

In 2009, they filed suit in Las Vegas against accounting firm Deloitte & Touche LLP, charging it harmed them by disclosing to GCA board members information in an FBI bulletin that they say was part of a hoax or a scheme and that wrongly associated them with criminal activity.

Clark County District Court Judge Elizabeth Gonzalez in May dismissed that suit, finding Deloitte & Touche’s statements to the GCA Audit Committee were privileged and there was no evidence the statements were made with malice.

"Deloitte & Touche had an interest in the accuracy of GCA’s financial statements as well as a duty under the Securities Exchange Act of 1934 and generally accepted auditing standards to disclose the allegations to the GCA Audit Committee so that the audit committee could investigate whether it was likely that illegal acts had occurred," her ruling said.

As a publicly traded company, GCA and its auditors must comply with Securities and Exchange Commission regulations.

Attorneys for Cucinotta and Maskatiya on July 6 appealed that ruling to the Nevada Supreme Court, where the case is in the briefing stage.

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