Take the nationwide expansion of gambling casinos at a time when the US us teetering on solvency from attacks of systemic fraud and corruption and the deepest poverty of citizens in US history. Build more dependence on a financial economy with an industry known to be full of fraud and corruption. Casinos these days are simply money-laundering operations. Sold again as job-creators and funding for public education as always we see none of this is true. In BAltimore we are seeing already where the city steps in to subsidize a brand new casino with taxpayer money and all the casino revenue simply funnels to Baltimore Development projects---not education. So, as with the Hilton and Hyatt downtown, now the citizens of Baltimore will subsidize the losses of this casino.
THEY KNEW THIS WOULD HAPPEN.
Johns Hopkins is behind this deal and is buddy buddy with Cordish of Maryland Live.....Hopkins designates that area of downtown a tax-free Enterprise Zone and Cordish builds Hopkins a LaCrosse Museum. As this article below states-----Caesars is now creating good bank/bad bank business arrangements to keep profits coming and where is the best place for a bad bank but Baltimore protected by Baltimore Development and Hopkins' Baltimore City Hall. Remember, these major shareholders of Caesar's stock don't care if Baltimore residents lose in subsidizing these failed business deals----they are protecting the wealth of the corporation as a whole. The same is happening when a global corporation controls our business sector------like our gas stations or now VEOLA transportation and environment. If these corporations lose money somewhere in the world----they simply soak consumers somewhere else. That is what this casino deal is about and it will be what VEOLA ENVIRONMENT is about.
This is a great article but I was shouting this three years ago as they were planning this casino-----the financial standing of Caesar's was known then. Baltimore media was charged with making this move all great stuff with no talk of the fact this was another albatross for the citizens of Baltimore. IT'S ALL ABOUT THE JOBS SAY NEO-LIBERALS AND NEO-CONS!
WHO SUPPORTED CASINOS IN MARYLAND IN ADVERTISEMENTS? LABOR UNIONS AND MARYLAND STATE EDUCATION ASSOCIATION. OUR LABOR AND JUSTICE LEADERSHIP. UNIONS HELD HOSTAGE FOR JOBS AND UNION RIGHTS.
Wall Street sharks circling the financially bleeding operator of Horseshoe Baltimore PART ONE in a three-part series on Caesars Entertainment's troubled empire describes the high-stakes game it is playing with creditors
Mark Reutter September 9, 2014 at 12:54 pm BAltimore Brew
Overlooked in all of the hoopla surrounding the opening of Baltimore’s Horseshoe casino is this sobering fact – the major owner and sole operator of the new facility is in deep financial trouble.
Weighed down by $23 billion in debt and losing $5 million a day in the second quarter of 2014, Caesars Entertainment Corporation is now facing an insurrection by key creditors.
A shiny, low-debt spin-off company it created – Caesars Growth Partners LLC, of which Horseshoe Baltimore is a part – has been a trigger for three major lawsuits in the last month.
The suits, coming from different groups of bondholders, boil down to the accusation that Caesars has been fraudulently transferring its “good” assets out of the reach of creditors and undercutting the value of the parent company.
The world’s largest casino company hasn’t posted a profit in its core operations since 2009. Last year it shocked Wall Street by reporting $3 billion in losses – the result of softness in its Midwest and Gulf Coast markets and a steep decline in Atlantic City.
Caesars’ shaky finances was one reason why last October the Massachusetts Gaming Commission forced the company to withdraw from a proposed $1 billion casino near Logan Airport. The commission’s staff thought its debt load could prove lethal if the economy went into another downturn.
Turmoil in Atlantic City
On August 31, Caesars shut down its Showboat Casino in Atlantic City. Overall, revenues at the one-time mecca of East Coast gambling have plummeted from $5.2 billion in 2006 to $2.8 billion last year.
While competition from new casinos in Pennsylvania, Delaware and, more recently, Maryland are considered an immediate cause for Atlantic City’s distress, a longer-term factor at play is the loss of “low rollers” – clients willing to bet $50 to $75 per casino visit – since the 2008 recession.
Underscoring the industry’s woes, another Atlantic City giant, Trump Entertainment Resorts, filed for bankruptcy protection today. The company plans to shut its Trump Plaza in Atlantic City next Tuesday and announced it may close the famous Trump Taj Mahal in November.
In court papers, Trump reported that gaming revenues fell 16% last year – and decreased more than 18% during the first six months of 2014.
A guard outside Atlantic City’s Showboat Casino, which Caesars closed on August 31. Caesars remains the largest casino owner in struggling AC with Bally’s, Caesars and Harrah’s. (Mel Evans, AP)
Help From City Hall
If Caesars’ (and more generally, the gaming industry’s) poor financial health comes as a surprise, it’s partially because the Rawlings-Blake administration has trumpeted the benefits of the Baltimore casino without alluding to any possible downside.
The mayor has tirelessly promoted the 1,700 new jobs at the casino and the prospect of lowering property taxes and increasing school construction funds from gaming revenues expected to come to the city over the next 10 and 20 years.
But at the same time, she and the Board of Estimates have agreed to allocate millions of dollars of “community impact” funds – earmarked by the Maryland legislature for South Baltimore neighborhoods to compensate them for crime, traffic jams and other negative impacts from the casino – right back to Caesars.
In 2012, The Brew disclosed that the city tucked into its land lease agreement with Caesars a provision to reimburse the company with community impact funds for $6 million in street improvements immediately around the casino.
Baltimore’s new casino on Russell Street sits next to a public storage building. (Photo by Fern Shen)
Last month, The Brew reported that the city has pledged another $3 million of community impact funds to pay Caesars to relocate an underground steam pipeline that went between the casino and its new parking garage.
According to the 2015 impact budget approved by the mayor, another $3.85 million will come out of community funds to underwrite a planned police “mini-district,” security cameras, sanitation, traffic enforcement and other direct services to the casino.
Mayor Rawlings-Blake has defended the use of impact funds for the relocated pipeline as permissible because it is “infrastructure.” She said her administration tried to identify other sources for funding the project, but use of community funds “was the best alternative.”
She and the Caesars organization have not responded to The Brew’s questions about a 2013 city ordinance that indicates that Caesars is responsible for paying for the pipeline relocation.
Questions emailed yesterday to the mayor’s office and to Caesars’ headquarters in Las Vegas about the company’s finances and how the lawsuits could affect Horseshoe operations have gone unanswered, too.
If Caesars isn’t talking, its junior bondholders are through lawsuits filed in the Delaware Court of Chancery and in Manhattan that argue, essentially, that they were left holding the bag.
Billionaire investor Paul Singer has sued Caesars for “fraudulent” dealings and Caesars has countersued Singer. (the richest.com)
These circling sharks include some of Wall Street’s fiercest, among them Paul Singer of Elliott Management, David Tepper of Appaloosa Management and Howard Marks of Oaktree Capital.
On the opposite side of the table sit the senior bondholders, a group of Wall Street titans who are betting on Caesars – or at least on its recently spun-off entities.
They include aging financier George Soros and private equity honcho John Paulson, who both became major stockholders of Caesars Acquisition Co. last November.
Other key backers are Leon Black of Apollo Global Management and David Bonderman of TPG (Texas Pacific Group) Capital who took the company private in a leveraged buyout in 2008.
(Faced with nearly $30 billion in debt from that buyout, Caesars has reentered the public markets on a limited basis. It is traded on NASDAQ as “CZR,” where its price has dropped 28% in the last three months.)
George Soros (above) and John Paulson (below) have become major shareholders of Caesars Acquisition Co. that partly controls the new Baltimore casino. (telegraph.uk.com)
Caesars has upped the ante by filing a countersuit against several of its loudest detractors, saying they seek to injure the company and to push it into default.
The suit singled out Singer’s Elliott Management which, it claimed, has a significant position in Caesar credit default swaps that would pay out handsomely if the company misses its future bond payments.
“Good” vs. “Bad” Caesars
At the core of the high-stakes squabble is the question of whether Caesars is trying to spin off its new, debt-free properties – including Horseshoe Baltimore – into new companies, while saddling the original bondholders with a sick company.
Last year, Caesars formed Caesars Growth Partners with Apollo and TPF to fund new projects, including the Horseshoe Baltimore.
Technically, Caesars’ share of the Baltimore casino is owned by CBAC Borrower LLC, an indirect, wholly-owned subsidiary of CBAC Gaming LLC, which in turn is controlled by Caesars Growth Partners, which is a joint venture of Caesars Entertainment Corp. and Caesars Acquisition Co.
If that sounds confusing, there are additional investors in the Baltimore casino, most notably Rock Gaming founded by Dan Gilbert, the majority owner of the Cleveland Cavaliers NBA franchise and chairman of Quicken Loans. Rock and Caesars previously joined forces to own and operate Horseshoe Cleveland, Horseshoe Cincinnati and Thistle Down Racino in North Randall, Ohio.
The alphabet-soup of companies and subsidiaries formed by Caesars are at the crux of the charges the company with fraudulently transferring “good Caesars” assets to new entities, leaving “bad Caesars” properties behind for bondholders to take a “haircut,” or financial loss.
What’s looming ahead of the gaming company – and its bondholders – is $5 billion in debt payments due by the end of 2015. At present, most of Caesars’ debt is trading at one-third its face value.
In other words, the “too big to fail” theory in the gaming world is about to be tested as Caesars insists that its brand name, worldwide network and loyal customer base will see it through the financial tempests ahead.
As for Baltimore, the mayor and her staff aren’t saying what they might do (or could do) in case of a Caesars default or a bankruptcy filing by the parent company.
Their philosophy appears in keeping with the bravura words of Roman Emperor Julius Caesar (for whom the gaming company is named) before his assassination in 44 BC:
“Go on, my friend, and fear nothing. You carry Caesar and his fortune in your boat.”
NONE OF THESE DEALS ARE LEGAL AND THESE CONTRACTS CAN BE VOIDED BECAUSE NONE OF THIS IS IN THE PUBLIC'S INTEREST. IT IS PUBLIC MALFEASANCE.
So, who are the bond-holders for this Baltimore casino everyone knew would fail and eat the debt?
You can bet the MECU---Baltimore and Maryland State Employee Credit Unions are involved---they are being used to buoy all of this Baltimore Development Corporation racketeering. If you place the Baltimore citizens in harms way with these bond deals----they are made to have an interest in these bailouts. Municipal bonds no doubt, both state and city. Remember, this coming bond market crash will cause all government bond deals to default so the loses to the public and these state and city credit union consumers will take the brunt. Don't forget pension funds---both private and public! We'll see soon who these losers are! This is what happens when you allow your domestic economy be controlled by global corporations and Hopkins is neo-con and O'Malley is serving as a neo-liberal and both work for the same global corporate wealth and profit.
JUST VOTE FOR THE CANDIDATES SHOUTING FOR A DOMESTIC ECONOMY HOLDING GLOBAL CORPORATIONS AT BAY----BE THAT CANDIDATE!
Think for a minute-----this financial status did not happen over night----they were shouting this problem years ago. People cannot afford to gamble for goodness sake---they have been looted and booted from employment.
Bondholders want Caesars to put cards on the table
Oct 8, 2014, 2:47pm CDT Updated: Oct 9, 2014, 9:22am CDT Caesars Entertainment Inc. Interior of Horseshoe Casino and Hotel, one of two properties Caesars owns in Tunica
Michael SheffieldSenior Staff writer- Memphis Business Journal
As it continues to try to get its debt under control, a group of bondholders of Caesars Entertainment Corp. have lost patience with the company.
According to a Bloomberg report, Wilmington Savings Fund Society, which represents a group that holds $3.7 billion of Caesars Entertainment Operating Co. second lien notes, has claimed Caesars has defaulted on its bonds. The company will have 60 days to take action to avoid defaulting on the bonds.
Caesars owns Horseshoe Casino and Hotel and Tunica Roadhouse as well as the now-closed Harrah’s Tunica. Caesars is restructuring more than $1 billion in financial obligations due in 2015, but the company has an estimated $24.2 billion in long-term debt, according to the report. After shutting down Harrah’s Tunica, Caesars announced plans to pursue a casino in New York, which recently legalized casino gaming.
The Bloomberg report also states a group of bondholders filed suit against Caesars in August, accusing the company of fraudulently moving assets after it sold a 5 percent stake to a group of investors. Shares of the Caesars’ (NASDAQ: CZR) stock were down nearly 2 percent in late afternoon trading at a cost of $11.18 per share.
MECU is simply a Wall Street bank that operates tax-free and sends its profits to these Baltimore Development scams that then create loses for these partners.....it is a ponzi scheme. If you look at the article below it states that Germany started these people-friendly financial systems that even in Germany have been highjacked by Wall Street and now have directors working for Wall Street interest. What do many in Baltimore say of the head of MECU? Nothing that has to do with honesty and integrity.
This is how the European nations like Spain, Portugal, and Italy were blown up------Spain had an incredible amount of building that was unnecessary and all the funding tied to public banks, pensions, and municipal debt. This is why these nations in Europe struggle the most.....the TROIKA there uses austerity to replace all of the public wealth stolen in corporate fraud and government malfeasance. Well, these development deals in Baltimore are the face of the same policies and corruption and it is all happening just before the next economic crash of the bond market!
WE CAN REVERSE THIS AND HOLD THESE POLS AND CORPORATE EXECUTIVES ACCOUNTABLE FOR PUBLIC MALFEASANCE ----WE SIMPLY HAVE TO VOTE OUT THE BAD POLS AND RUN AND VOTE FOR LABOR AND JUSTICE CANDIDATES IN ALL DEMOCRATIC PRIMARIES!
'As Baltimore's Credit Union, we're committed to both helping you keep more of the money you earn and making our community a better place to live. In this section we've gathered some of the best local information and value-oriented websites to share with our members'.
Share our vision at Municipal Employees Credit Union of Baltimore
Since 1936 MECU has been in the heart of Baltimore serving its members and helping to strengthen the community. We are individuals with heart helping others improve their financial lives.
MECU's success in providing high quality financial services to the community is based on sound management and innovation. MECU appreciates the vital role our service oriented and engaged employees play in achieving our goals. Our main goal is to create member loyalty by providing services that improve the financial lives of our members and potential members who live, work, worship, or attend school in the city of Baltimore or belong to one of our Select Employee Groups.
MECU is committed to making the city of Baltimore a better place. Through our outreach programs, MECU is involved with a wide range of community projects including Our Daily Bread, Sandtown Habitat for Humanity, Blood Drive, charity fund raising and reading programs. We are helping to meet the needs of the community we serve.
At MECU, we understand the importance of diversity and inclusion to the long-term success of our company. We are committed to creating an inclusive, open, and respectful culture comprised of individuals from diverse backgrounds - each of whom is given a platform for success. MECU's goal is to create a work environment that values the unique attributes, perspectives, backgrounds, skills, and abilities of each individual.
Differences from other financial institutions Credit unions differ from banks and other financial institutions in that those who have accounts in the credit union are its members and owners, and they elect their board of directors in a one-person-one-vote system regardless of their amount invested. Credit unions see themselves as different from mainstream banks, with a mission to be "community-oriented" and "serve people, not profit".
Not-for-profit status In the credit union context, "not-for-profit" is not the same as for a "non-profit" charity or similar organization. Credit unions are "not-for-profit" because their purpose is to serve their members rather than to maximize profits. For instance, Delta Community Credit Union
It is a state-chartered nonprofit cooperative credit union owned by its members. But, unlike charities and the like, credit unions do not rely on donations, and are financial institutions that must perforce make what is, in economic terms, a small profit (i.e., in non-profit accounting terms, a "surplus") to remain in existence.According to the World Council of Credit Unions (WOCCU), a credit union's revenues (from loans and investments) must exceed its operating expenses and dividends (interest paid on deposits) in order to maintain capital and solvency. WOCCU's position is deeply rooted in global credit union history. F.W. Raiffeisen, the founder of the global movement, wrote in 1870 that credit unions "are, according to paragraph eleven of the German law of cooperatives, 'merchants' as defined by the common code of commerce. They accordingly form a sort of commercial business enterprise of which the owners are the Credit Unions' members".
One of the first thing Obama and neo-liberals did during the worst of the banking collapse is pass laws that allowed credit unions to act even more as banks.....remember, they are now basically Wall Street banks that do not pay taxes. What is equally true is more and more of these credit unions are being found to be acting fraudulently. Now, MECU involves itself in all these deals that end with Baltimore taxpayers subsidizing corporate profit so-----does something smell in Denmark?
Baltimore is ripe for this activity because all these people committing fraud and government corruption think they are safe because there is no city attorney or investigation into these kinds of crime and the Baltimore courts are corrupt in protecting the chances of prosecution. This all changes simply by having as Mayor of Baltimore someone that wants justice to work.
This is what the Horseshoe Casino was about. It is a typical day in the life of a very corrupt and criminal Baltimore economy written by Johns Hopkins.
The Dirty Dozen: 12 Notorious Credit Union Heists
By Peter Strozniak October 01, 2012 •
Over the years, the credit union industry has witnessed notorious fraud and embezzlement cases involving CEOs and their family members, credit union members, rank-and-file employees, labor union chiefs, computer consultants, lawyers, real estate investors, government workers and entrepreneurs.
While there has been a lot of credit union fraud cases of varying degrees, this list focuses on what Credit Union Times believes to be the worst of the worst cases, which we name the Dirty Dozen. The individuals involved in these infamous heists –many of whom are still in prison – stole a total of more than $185 million over the past 25 years.
So why do they steal?
Christopher T. Marquet, CEO of Wellesley, Mass.-based Marquet International that investigates corporate fraud and embezzlement cases, said there are a lot of different motivating factors, but there is one that stands out.
“When you look at the major frauds of $1 million or over, people embezzle money not because of need,” said Marquet, who publishes a comprehensive annual fraud study on major U.S. embezzlement cases. “Instead, they have a sense of entitlement to maintain a lifestyle that is grander than what they could otherwise afford, and somehow they have convinced themselves that they deserve it.”
And while the embezzlers have concerns about getting caught, those worrisome thoughts fade away after they steal a few times, get away with it and convince themselves it’s easy to steal and they won’t get caught, Marquet said.