Problems at the World Series of Poker

There are no spoilers in this post

There is a long history of problems at the World Series of Poker that most of the public is unaware of, problems with money being taken for one ostensible purpose and used for another and with dealers and tournament staff being cheated as a result. When Harrah's bought Binion's in 2004, everyone hoped that those problems would come to an end. Unfortunately, that doesn't appear to be the case. Let me give some background on that story and then on to the current problems.

The WSOP was begun by Benny Binion, the legendary casino owner, in 1970. It slowly grew until his death in 1989, after which his son Jack took over the family business and it began to grow even faster. A few years later, a legal battle between Jack and his sister Becky came up, with Becky winning control of Binion's Horseshoe Casino in 1998. After Becky took over the operations, things deteriorated quickly. Along with her husband, Nick Behnen (who was barred from holding a casino license by the state of Nevada because of his shady past), Becky Binion Behnen pretty much ran the place into the ground.

In 2001, the shit hit the fan, so to speak. The WSOP announced that they were going to withhold 3% from the prize pool to use as a "toke pool" - a fund that would be divided among the dealers and tournament staff as tips. This was a good idea, but some background is probably required for non-poker players to understand why. Big tournaments like this require a lot of people to run, obviously, and no casino has enough dealers or floor people on hand to handle such an event. So there is a pool of poker dealers and tournament staff that basically floats around the country running big poker tournaments. They have to pay their own way, though, so they have to be assured of making a certain amount of money to make it worthwhile and profitable for them.

It's in everyone's best interests to have high quality dealers and staff to run things, so having a pool that would guarantee them a minimum income helps the players as well as the dealers and staff. Relying on the players who finish in the money to leave tips, which most did, was too inconsistent, and those tips are not tax deductible, so it really hurt the winners to do it. All in all, a toke pool was a great idea for all involved and most of the major tournaments use one now for all these reasons.

The problem here was that rumors were flying that Becky was planning to use some of the money to reimburse her everyday hotel staff rather than distribute it all to the dealers and staff, and they were refusing to spell out how much would go to whom (the traditional breakdown was something like 2% to the dealers, 1% to the floor staff and tournament personnel). Word got around and a lot of players were talking about it. Jeff Simpson, a casino beat writer for the Las Vegas Review Journal, did a story on it and cornered a few players at the Horseshoe to get their thoughts on it. Among those quoted was Paul Phillips, a professional poker player from Las Vegas, who told Simpson that the players had been misled on the issue and felt antagonized, which was entirely true. Paul was also at the time a regular participant in the rec.gambling.poker (RGP) usenet newsgroup, which I have long participated in as well.

The day after Simpson's article was published, Paul Phillips was pulled from a game at the Horseshoe by some of Becky's goons security personnel, taken to a back room, photographed and barred from the casino for daring to say what everyone knew was true. Amusingly, her head of security told the newspaper that they barred him because they wanted to "avoid controversy" at the WSOP. And this all happened on the day the tournament started! Brilliant folks, eh? Needless to say, rather than avoiding controversy, it caused more. And adding to this, it was announced that Becky would consider letting him come back if he apologized to her for what he said in the paper. All of this caused quite a furor in the poker world, particularly in the RGP newsgroup. I was one of many, many people who came to Paul's defense and strongly criticized Binion's for their actions.

Ironically, Paul was proven 100% correct by what happened in the following few weeks. Linda Johnson, the founder of Card Player magazine, met with Becky and tried to get Paul unbarred (which was successful, but when he went back they intimidated him some more and he decided it was safer to stay away) and to settle once and for all the question of where the money would be going. Becky allowed Linda to release a statement in RGP that she had approved word for word, which said that every penny of the toke pool would go to the dealers and tournament personnel. She lied. Over the course of that years World Series, Becky shorted the dealers and tournament personnel to the tune of nearly $200,000, which resulted in some of them walking out on her when the tournament ended. She fired the tournament directors and her poker room manager, who was the daughter of the tournament director, as well as a couple of others and it blew up into an even bigger controversy.

In the process of all of this, I received a nasty and incoherent e-mail from Benny Binion Behnen, Becky's son, who was the head of the poker operation at the Horseshoe. He actually challenged me to a poker match, as though that would somehow absolve them of their lies. I'm not sure what his reasoning was, but he was quite irrational. And of course, I was barred from playing at the Horseshoe as well, which was hardly a big deal. I didn't play there anyway. It had long since become a broken down wreck of a casino, filled with the stench of a billion cigarettes and who knows what else. The only reason to go there would be to play in the WSOP, which I wasn't planning to do anyway as long as these scumbags ran the place. 2002 met with more controversy yet, with Becky firing some of the dealers for staging a walkout when they were lied to yet again, and getting sued. She finally ran the place into the ground completely in 2003 and in early 2004, Harrah's came in and bought up the Horseshoe and, along with it, the World Series of Poker.

Since then, the WSOP has continued to grow at an insane rate, going from over 2500 players in 2004 to over 5000 last year to an expected 8000 this year (they're capping the entries at 8000 and should easily fill them). That growth makes it even more crucial that there be a large and reliable staff of dealers and floorpeople to handle things. For this year's tournament, they hired 750 dealers from around the country to come in. Those dealers have to pay their way to Vegas, plus accomodations, so they have to be guaranteed a certain amount of money to make it worthwhile. And without dealers, you have no tournament.

Since Harrah's took over, sponsorship has boomed, which has brought in untold millions in revenue. ESPN, Party Poker and Milwaukee's Best Light are all major sponsors of the event and I'm sure they pay handsomely for their name on everything. Despite all that revenue, the size of the vig (the amount taken out of the prize pool by the casino as profit) and the toke pool (the amount taken out of the prize pool for the dealers and floor staff) has remained high.

Unfortunately, like 2001-2003, there are still irregularities in way people are being paid. A sizable contingent of the dealers at the WSOP walked out in protest last week, delaying the start of a tournament. Apparently, Harrah's held all the dealers' checks for one week to insure that they couldn't leave, and when they got them, the checks were much smaller than expected. And we're talking about what should be enormous sums of money.

Let's look just at one of the early tournaments (the WSOP is actually a series of over 30 tournaments). In the $2000 No Limit Hold Em event, there were 1919 entries. That's a total prize pool of $3, 838,000. Harrah's withheld a full 9% of the prize pool, about $350,000, out of which about 3%, or about $150,000, should have been divided between the dealers and the floor staff. By the industry standards (informal, not formal, these are just norms) $100,000 should go to the dealers (2%) and $50,000 should go to the floor staff (1%). With that number of players, you need approximately 200 dealers (192, actually), so each of them should have gotten about $500 for dealing that tournament, plus their hourly rate or "down" rate (there seems to be some confusion as to whether they're being paid hourly or per "down", which means per shift at the table).

Unfortunately, since Harrah's took over, the costs of the tournament have only gone up, not down, despite massive sponsorship deals that bring in huge amounts of money. Both last year and this year, they've had dealers and floor staff walk off and quit because they weren't getting what they were promised, which is the same sort of thing that was going on with Becky Binion Behnen running it. What Harrah's is making on the WSOP has become truly staggering, but they have continued the tradition of screwing over the dealers and staff. Unfortunately, the tournament has become so hugely popular that none of that is likely to impede the growth of the event. Don't be surprised if, over the next couple weeks, there is a massive walkout of all the dealers and floor staff to send a statement to Harrah's, however, that without dealers they've got no tournament.