The 500 Club has been allowed to reopen its bar and restaurant at 6 a.m. Tuesday, but the card room’s problems are more complicated.
The emergency closure order issued last Wednesday closed the card room until further notice. The state is continuing its investigation into what it calls insufficient funds to cover “chips in use.” On Friday, the state issued an accusation, which now threatens the card room’s owners with the loss of their state license.
A closure would have ecomic repercussions to the city of Clovis. The card room and restaurant employ 265 people. Of those, 202 are card-room employees, said Dusten Perry, the 500 Club’s general manager. The club generated $420,000 in revenues for the city of Clovis last year and $460,000 in 2015.
In 2015, the card room was issued a license following another accusation about card room investors not being identified in state documents. Following an investigation, the state Gambling Control Commission issued a license that continues through Sept. 30.
Even with the looming threats, the card room’s lawyer and general manager say they are hoping the card room can be open by the weekend.
The state Department of Justice’s Bureau of Gambling Control on Wednesday raided the business at Willow and Shaw avenues.
The state’s investigation determined that the 500 Club “lacked sufficient records to document its chips-in-use liability.”
Fresno lawyer Jim Betts, who represents the 500 Club, said the accusation was required within 48 hours of the closure order.
He said the 500 Club’s owners are requesting that a hearing be conducted within 10 working days.
In addition to possibly revoking the license, the state Department of Justice’s accusation could result in fines and penalties and award the state its investigative costs.
Last week’s closure followed an unrelated accusation in June that says the card room failed to disclose loans from those who should have had card room licenses and required identification as ownership partners.
I am hoping they are motivated to work with us and that it will be as soon as possible, but I don’t see any reason why it wouldn’t be this week.
Jim Betts, lawyer for the Clovis 500 Club
As of 10 days ago, the state said the chips-in-use liability “substantially exceeded the balances of the club’s chip liability and general accounts.” Last week, state Department of Justice officials conducted a second on-site evaluation and again determined that the 500 Club “lacked sufficient funds to cover chips in use.”
The card room has an $800,000 bond to meet its chips obligations. He said the card room is allowed to have the bond as a financial backup, which is permitted under state rules. The card room’s owners notified the state of the bond in 2015, said Betts, the card room’s lawyer.
“The (records) submission in 2015 included the bond and they confirmed receipt,” Betts said. “We gave them the bond, and at the very least, they never said a word.”
The state, he said, closed the card room without prior notice that the owners were failing to follow state rules.
“We are submitting the last piece of what the Bureau (of Gambling Control) has required for us and requesting that the card room be cleared for reopening,” said Betts. “I am cautiously optimistic it will be this week. I am hoping they are motivated to work with us and that it will be as soon as possible, but I don’t see any reason why it wouldn’t be this week.”
The 500 Club card room opened at Willow and Shaw in June 2012 with 18 tables, tripling in size from the old Clovis Avenue and Fifth Street location. The old site remains open as a restaurant and was unaffected by the state’s action.
The restaurant in the 13,000-square-foot Shaw and Willow avenues site will be open from 6 a.m. to 11 p.m. on weekdays. Weekend hours are yet to be determined.
The staff is hoping to have the casino reopened by the weekend, and the operation would return to 24 hours, officials said.