Owners of the club’s card room were notified Wednesday night.
The card room at the club, located at Shaw and Willow avenues, closed Aug. 16. The club’s restaurant remained open for much of the past two weeks, along with the 500 Club restaurant on Clovis Avenue.
The state earlier this month issued an emergency order that closed the card room after finding the card room’s owners didn’t have enough money to cover chips in use.
The state Department of Justice’s Gambling Control Bureau said it also had sought, on multiple occasions, records about the card room’s bank accounts, “but the Clovis 500 Club repeatedly failed to provide the requested documents.”
Card room owners maintained there was enough cash to cover the chips, whether from cash in the club, the card room’s vault or bank accounts. They said the 500 Club also has an $800,000 bond it could tap.
To reopen, the card room owners were required to reach an agreement with the state Gambling Control Commission. Terms of the agreement haven’t been disclosed.
Club owners had to provide “a report detailing the source of all funds” related to gambling activities, state reports said.
The state also sought to revoke the license of card room owner Louis Sarantos and deny his license renewal. The state also wanted card room owners to pay fines and penalties, as well as costs of its investigation.
State investigators also wanted removal of the card room’s general manager, Dusten Perry. A new, state-approved general manager would oversee all financial and staffing operations and provide the state with sources of funds as well as profit-loss statements.
That manager must certify independence from the ownership of the Clovis 500 Club, the state’s order said.
The state’s accusation followed an accusation in June that the card room failed to disclose loans from those who should have had card room licenses and been listed as ownership partners.
Among those who made loans to the card room operation in recent years was at least one convicted felon, according to state records and a lawsuit filed by a competitor. The state also found that one of the key employees at the card room didn’t have a license to work there.
The state requires disclosure of those involved in ownership of a card room. Any person in ownership must have state licenses to ensure that the partners do not have criminal backgrounds.
An accusation filed in June by the state was a follow-up to one issued in 2015.
In 2015, the card room was able to retain its license while the investigation continued. The license expires Sept. 30.
At issue was an agreement reached in 2011 with Fresno lawyer John Cardot, who once represented the 500 Club. That agreement with Louis Sarantos gave Cardot a 50 percent stake if he provided a $1.5 million loan to Sarantos to build tenant improvements when the 500 Club was expanded and relocated from downtown Clovis to Shaw and Willow avenues.
The updated accusation, filed June 29, states Sarantos failed to disclose Cardot as a financial interest holder and the terms of indebtedness. Sarantos also didn’t disclose names of six other financial interest holders and his level of indebtedness to them, the updated accusation says.
The new card room opened 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. There also is a restaurant in the 13,000-square-foot Shaw and Willow avenues site.
Closing the 500 Club also meant a short-term loss of revenue for the city of Clovis. Last year, the city got $420,000 from the card room’s operations. In 2015, the arrangement brought in $460,000, according to city documents.
The 500 Club has 265 employees. More than 200 are employed in the card room operation.