A two-year investigation into Amaya Inc.’s .9 million acquisition of PokerStars has resulted in 23 total charges of insider trading against three companies and three individuals by Quebec regulators—including five charges against CEO David Baazov.
The charges stem from a surge in Amaya’s share price ahead of the acquisition.
The charges are “very serious,” Sylvain Théberge, spokesman for the Quebec regulator the Autorité des Marchés Financiers, told CBC news. If found guilty, the Amaya officials could face fines of up to $5 million and five years in prison.
Baazov quickly released a statement denying the charges and saying he will “vigorously contest them,” and a few days later took a leave of absence.
The AMF also announced it had executed search warrants and obtained freeze and cease-trade orders in regards to 13 other individuals tied to mergers and acquisitions involving Amaya.
Théberge said the investigation began in June 2014, after Amaya acquired the privately held Rational Group—or Oldford Group—the parent company of online poker websites PokerStars and Full Tilt Poker. The acquisition made Amaya the largest online gambling company in the world. A raid of Amaya’s offices in Pointe-Claire was conducted in December 2014.
Baazov’s charges include aiding with trades while in possession of privileged information, influencing or attempting to influence Amaya’s market price and communicating privileged information.
Amaya also released a statement saying the charges are without merit and saying they involve allegations relating to a former financial adviser to the company and an employee.
Meanwhile, just one week into its online poker operations in New Jersey, PokerStars already appears to be dominating the market and attracting more players than any other site in the state.
According to PokerScout, PokerStars NJ averaged 170 cash game players in its first week with a 24-hour peak of 441 players. Meanwhile, WSOP/888 had 140 and 341, respectively. Party Borgata NJ is in third with a 95-player average over the week and a peak of 252.
Play is restricted to players physically located in the state and pales in comparison to the global PokerStars platform, which averages 17,000 cash game players.
Still, the New Jersey market has shown signs of growth, though most of its revenue comes from online casino games. The state’s online gaming win was a record $14.7 million in February, compared to $10.4 million in February 2015, reflecting an increase of 41.8 percent. Online poker, however, brought in just under $2 million, down 2.5 percent from 2015.
PokerStars NJ, however, also offers slots and casino games.