Pinnacle activities reviewed

Jun 25, 2002 7:34 AM

About the only thing the parties agree on is that there was a golf tournament but exactly who sponsored it is still being argued by the Indiana Gaming Commission and the operators of the Belterra Resort and Casino.

Officials allege that the Ohio River casino, owned by Pinnacle Entertainment Inc. (PNK), actually sponsored the tournament and imported prostitutes from California to entertain some of the casino’s high-rollers.

As part of the investigation, the commission fined R.D. Hubbard, the former Pinnacle chairman, $740,000 and ordered that he dispose of all his stock in the company. Hubbard also was ordered to turn in his Indiana gaming license. Hubbard and Paul Alanis, former Pinnacle president and CEO, resigned their positions and were replaced by Dan Lee, former CFO of Mirage Resorts.

The investigation into Pinnacle activities began when two female employees filed lawsuits charging that they were pressured by the company to use sex in attempting to develop more customers for the casino.

Both women, whose responsibilities were as player development managers, told commission investigators that the company scheduled the golf weekend and flew in prostitutes from California who groped and fondled male guests during the tournament’s kickoff party.

Reportedly, the company was prepared to pay a $1 million fine but that the commission said they wanted to delay the penalty until the probe was completed.