The Inside Story: How a Casino Got Caught Up in Alleged Financial Manipulation and Insider Trading

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Step right up, folks! It’s time to take a deep dive into the murky waters of casino finance. Yes, you heard that right – we’re exposing the inside story of how one gambling giant got caught up in alleged financial manipulation and insider trading. From high-stakes deals to shady backroom dealings, this is a tale that will keep you on the edge of your seat. So buckle up and get ready for a wild ride as we uncover all the juicy details of this scandalous saga.

The Players Involved

Federal investigators are looking into whether there was any manipulation or insider trading involved in the $850 million sale of the Tropicana Casino and Resort in Atlantic City.

The Players Involved:

-The two buyers, Icahn Enterprises and Gaming and Leisure Properties, who paid $850 million for the property.

-The two sellers, Columbia Sussex and real estate investment firm Gaming and Leisure Properties, who sold the property for $850 million.

-Tropicana Entertainment, the casino operator that was spun off from Columbia Sussex in 2010. Tropicana Entertainment operated the casino until March 2015, when it was sold to Gaming and Leisure Properties.

The Scheme

The scheme was allegedly perpetrated by a group of individuals who used their insider knowledge of the casino’s financials to manipulate the stock price and profit from illegal insider trading. The scheme was uncovered by federal investigators and resulted in charges being filed against the individuals involved.

How the Casino Got Caught

On May 19, 2014, the Securities and Exchange Commission (SEC) charged a Las Vegas casino and two of its former executives with engaging in a years-long scheme to manipulate the casino’s books to artificially inflate its stock price.

According to the SEC’s complaint, from at least 2009 through 2012, the Riviera Casino & Hotel and its then-CEO and CFO engaged in a series of fraudulent transactions that resulted in the overstatement of Riviera’s revenue by more than $20 million. The SEC alleges that the defendants also made false and misleading statements about Riviera’s financial condition and performance in order to deceive investors.

As a result of the defendants’ fraudulent scheme, Riviera shareholders were misled about the true financial condition of the company. When the truth was finally revealed, Riviera’s stock price plummeted, causing investors to lose millions of dollars.

The SEC’s complaint charges Riviera Holdings Corporation, former CEO William Richardson, and former CFO David Kirvin with securities fraud. The SEC is seeking injunctions against all three defendants, as well as civil penalties and disgorgement of ill-gotten gains plus interest.

Aftermath and Lessons Learned

In 2015, a casino was caught up in alleged financial manipulation and insider trading. The casino had been accused of using false invoices to inflate its revenue, as well as of insider trading. After an investigation by the Securities and Exchange Commission (SEC), the casino agreed to pay a $1 million fine and to implement internal controls to prevent future violations.

The SEC’s investigation found that the casino had engaged in two separate schemes to manipulate its financial statements. First, the casino created false invoices from a vendor in order to inflate its revenue. Second, the casino engaged in insider trading by sharing non-public information with select investors who then traded on that information.

The SEC’s investigation also found that the casino had failed to implement adequate internal controls to prevent these violations from occurring. As part of the settlement, the casino agreed to pay a $1 million fine and to implement new internal controls.

This story highlights the importance of implementing strong internal controls to prevent financial manipulation and insider trading. Companies should have policies and procedures in place to ensure that their financial statements are accurate and that their employees are not sharing non-public information with investors.


It should be noted that while the casino industry is often divided into two separate worlds, an insider was able to take advantage of this division to manipulate stock prices and engage in insider trading. While it is impossible to know what other schemes could be hiding behind closed doors at casinos, this case serves as a reminder of how important it is for anyone involved with gambling activities to remain mindful of where their money goes and ensure they are not putting themselves in a vulnerable position.


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