Office of the Attorney General
David Samson, Attorney General
FOR IMMEDIATE RELEASE:
March 18, 2002
FOR FURTHER INFORMATION CONTACT:
Thomas Auriemma, Kerry Hand (609) 441-2533, cell#
(609) 229-2198
Chuck Davis, Genene Morris (609) 292-4791
DGE Takes Enforcement
Action Against Arthur Andersen
TRENTON - Attorney General David Samson
today announced that the New Jersey Division of Gaming
Enforcement has filed with the Casino Control Commission
a complaint and motion for a temporary order seeking
to prohibit New Jersey casinos from doing business
with the accounting firm Arthur Andersen.
Under the New Jersey Casino Control
Act, Andersen's recent federal indictment for obstruction
of justice and destroying documents relating to the
Enron case disqualifies the company from continuing
to transact business with New Jersey casinos and their
parent companies.
"It is essential to maintain public
confidence in New Jersey's casino industry and its
financial soundness through objective and impartial
auditing," Attorney General Samson said. "Arthur
Andersen's indictment calls into question its integrity
and ability to meet the high standards required to
carry out sound business practices necessary to do
business with New Jersey casinos." (Attorney
General Samson's complete statement concerning today's
enforcement action against Arthur Andersen is attached.)
As part of the action before the Casino Control Commission,
the Division also seeks to revoke the exemption previously
granted to Andersen by the Commission. In 1986, the
firm was exempted from casino service industry licensing
in accordance with the Casino Control Act section
92c which allows companies already regulated by a
public agency to request exemption from Commission
licensing requirements.
"Based upon the seriousness of
the charges set forth in the federal indictment, exemption
from licensure is no longer warranted," DGE Acting
Director Thomas Auriemma said.
"Independent accounting firms play
a critical role in ensuring that casinos comply with
all necessary regulatory safeguards," Auriemma
said. "The charges in the indictment seriously
undermine the state's ability to rely upon audits
undertaken by Andersen. Swift action is, therefore,
appropriate to maintain the high standards demanded
by the Casino Control Act."
The motion for a Temporary Prohibitory
Order is expected to be heard at the next Commission
public hearing on March 27, 2002. A vendor may be
temporarily prohibited from transacting business with
casinos, pending a plenary hearing, in accordance
with sections 109 and 129 of the Casino Control Act.
If the Commission grants the motion, the casinos will
have 15 days to terminate their relationship with
Andersen. The Division also seeks a permanent order
prohibiting the casinos and their parent entities
from doing business with Andersen.
###
