NY casino bidder: Attorney general probing state selection process for conflict of interest

Industries Associated Press

New York Attorney General Eric Schneiderman is investigating the state's recent casino selection process for potential conflicts of interest, according to a developer whose bid for a license fell short.

Continue Reading Below

Tioga Downs owner Jeff Gural said Monday that he met last week with a representative from Schneiderman's office asking questions about the process.

"They told me that they were planning on interviewing all of the applicants in an effort to see if they thought that the process was fair and if they thought a crime had been committed," Gural told The Associated Press.

A state selection board in December recommended three winning casino proposals in the Catskills, Schenectady and the Finger Lakes. Gural's bid was one of 13 losing bids.

Each of the successful contenders — Montreign Resort Casino in Sullivan County, Rivers Casino & Resort in Schenectady and Lago Resort & Casino in Seneca County — had some professional ties to a law firm picked to advise the Gaming Facility Location Board. In each case, one of the firm's attorneys had represented a member of the development team or an affiliate at some point.

The winners all disclosed the relationships in their formal applications to the state. In addition, the firm, Taft, Stettinius & Hollister LLP, also had past relationships with some of the losing bidders.

Continue Reading Below

Gural said that while he believes there was a conflict of interest, he doesn't think it violated any laws. Gural had one of two proposals from the economically struggling Southern Tier which were rejected in favor of Lago's bid in the Finger Lakes.

"I think the site selection committee is honest," he said.

Following criticism of the board's decision not to award a license in the Southern Tier, Gov. Andrew Cuomo asked the board to reopen the bidding to award a fourth license. Gural plans to resubmit his bid.

A Gaming Commission spokesman said Schneiderman has not contacted the agency about an investigation.

"The casino siting process strictly followed the provisions of the Upstate New York Gaming Economic Development Act, which called for unprecedented transparency," spokesman Lee Park said. "All material regarding the process, including legally required disclosures of potential conflicts of interest are available on our website for anyone to examine."

Messages left Monday seeking comment from Schneiderman's office and the law firm weren't immediately returned. A spokesman for Lago declined to comment.

The investigation was first reported by Crain's New York Business.