ZAYAT SAYS LAWSUIT CLAIMING HE OWES OFFSHORE BOOKMAKER $1.65 MILLION ?MERITLESS?
by Ray Paulick | 05.21.2015 | 9:07am
Ahmed Zayat, celebrating American Pharoah's Preakness victory last Saturday
Ahmed Zayat, celebrating American Pharoah's Preakness victory last Saturday
Ahmed Zayat, owner of Kentucky Derby and Preakness winner American Pharoah, is fighting a lawsuit filed last year by a former ?recruiter? for offshore bookmakers who says Zayat failed to pay a $1.65 million gambling debt from 2003, leaving the recruiter on the hook for the money.
The suit was filed March 11, 2014, in U.S. District Court in New Jersey ? where Zayat resides ? by Howard Rubinsky, who said he was paid commissions from gambling operators on the betting volume and/or losses of people he recruited to wager on sports or horses.
Rubinsky was associated with brothers Michael and Jeffrey Jelinsky ? described by Zayat as family friends ? when they pleaded guilty in 2009 to illegal bookmaking felony charges in Las Vegas, eventually serving time in jail. Rubinsky pleaded guilty to felony charges of illegal transmission of wagering information, money laundering and abetting. He was put on three years probation for his role in the case.
The lawsuit is based on what Rubinsky and his attorneys say was breach of a ?personal services? contract and unjust enrichment, the ?personal service? being to provide Zayat ?a place to wager,? Rubinsky said during a Nov. 19, 2014, deposition. One of those places to wager, Rubinsky said, was a Costa Rica-based sports book named Tradewinds, where he said he helped Zayat get a $3-million line of credit to bet on sports. He earlier set Zayat up to wager at Pinnacle Sports in Curacao, Rubinsky said in his sworn deposition, adding that Zayat won $1.4 million in a short time and was banned by the owner of the sports book because ?he?s too sharp, I don?t want this kind of business.?
Rubinsky said Zayat lost $2 million at Tradewinds in 2003, paid approximately $350,000 to the casino, then refused to pay the remaining balance. In 2008, after Rubinsky said he pursued Zayat for what he alleged was the outstanding balance to Tradewinds, Zayat paid Rubinsky $25,000 via a check from the Zayat Foundation to Rubinsky?s sister. Zayat said in his deposition the payment was made to help Rubinsky get through a health problem. ?I said I was going to help him to make payment toward his medical care, and if he needs money to eat I am happy to help him every week with money to eat,? he said in his deposition.
Zayat, both in interrogatories filed with the court and in a Nov. 11, 2014, deposition, denied all of the allegations. ?I never placed sports bets through the Internet or telephone (or any other means) at Pinnacle or Tradewinds, or any other online-telephone sports betting venue, either directly or through the Jelinskys,? Zayat said in a sworn declaration.
Zayat admitted that he bet with the Jelinskys in 2007 while in California, and in his Zayat Stables bankruptcy filing in 2010 there are payments to the Jelinskys listed as personal loans to them.
In May 2008, Zayat received a visit from a special agent with U.S. Office of Homeland Security and an investigator with the Nevada Gaming Control Board concerning his wagering with the Jellinskys. He learned during that visit, listening to a taped conversation provided by the officials, that he was being scammed by the brothers.
In his deposition, Zayat said: ?They put on a tape which was a conversation between the two brothers supposedly trying to scam me. Remember, I told you that there was a summer, I believe it was either 2007 or something of that nature, where that summer where I was not able to bet on my own personal accounts because I was in California, and in California you can?t bet online at a California track. That was the law. And there, I was betting my horses through Michael, and Michael was apparently giving me horses that he personally liked, okay. And these horses were being put in supposedly in the pools, but they were actually ? the two brothers was conspiring and booking these bets. Meaning let?s say that they really like, legitimately they are betting the race themselves, they like one, two, three. They were on purpose giving me five, six, seven. They are telling me to bet it. These bets were never actually put on in the pools. They are booking these bets so these horses were being not correct. So I would lose because they are giving me the wrong horses. But even these were not a ? they were not putting the money in the pool that I thought it was. It never ? it went into their own pocket. So they developed a scam and they made me hear the conversation between the brothers plotting how they are actually going to do that by one calling me and telling me that he liked that, that, that, and then putting these bets.?
iStable.com
His relationship with the Jelinsky brothers was a red flag to several racing commissions, which in 2010 investigated and ultimately cleared Zayat for fitness to be a licensed owner. He was under scrutiny again in 2013 when the owners of a New Jersey harness track alleged Zayat was improperly extended up to $286,000 in credit by the state?s advance-deposit wagering system.
In a written statement about the Rubinsky lawsuit, Zayat said: ?As my family and the racing world awaits watching the brilliant American Pharoah attempt to make history in the Belmont Stakes, there are some who are attempting to cause a distraction with mention of the Zayat Stables reorganization in 2009 as well as bringing up fictitious stories from 11 years ago.
?Some media outlets conveniently fail to report that when Zayat Stables filed for bankruptcy protection, it was a defense against predatory lending practices and broken promises made by a bank. These same members of the media also fail to recognize that Zayat Stables paid 100 percent of its creditors in full and that the bankruptcy had nothing to do with me personally.
?The rhetoric accusing me of owing monies over gambling debts is a pathetic attempt to extort me and we are expecting this meritless lawsuit from a convicted felon to be dismissed.
?My family and I thoroughly enjoy interacting with the thousands of loyal fans who reach out to us in many ways including through social media and will continue to do so. We recognize that there will be people who attempt, often through false, desperate measures, to take attention away from American Pharoah, his Hall of Fame trainer Bob Baffert, and brilliant jockey Victor Espinoza. Our family is grateful for this incredible expeeience and will continue to enjoy the ride along with the colt?s legion of fans.?
The Rubinsky lawsuit has received considerable media exposure over the last 24 hours, including this piece in the New York Times that goes into the matter in further detail.
by Ray Paulick | 05.21.2015 | 9:07am
Ahmed Zayat, celebrating American Pharoah's Preakness victory last Saturday
Ahmed Zayat, celebrating American Pharoah's Preakness victory last Saturday
Ahmed Zayat, owner of Kentucky Derby and Preakness winner American Pharoah, is fighting a lawsuit filed last year by a former ?recruiter? for offshore bookmakers who says Zayat failed to pay a $1.65 million gambling debt from 2003, leaving the recruiter on the hook for the money.
The suit was filed March 11, 2014, in U.S. District Court in New Jersey ? where Zayat resides ? by Howard Rubinsky, who said he was paid commissions from gambling operators on the betting volume and/or losses of people he recruited to wager on sports or horses.
Rubinsky was associated with brothers Michael and Jeffrey Jelinsky ? described by Zayat as family friends ? when they pleaded guilty in 2009 to illegal bookmaking felony charges in Las Vegas, eventually serving time in jail. Rubinsky pleaded guilty to felony charges of illegal transmission of wagering information, money laundering and abetting. He was put on three years probation for his role in the case.
The lawsuit is based on what Rubinsky and his attorneys say was breach of a ?personal services? contract and unjust enrichment, the ?personal service? being to provide Zayat ?a place to wager,? Rubinsky said during a Nov. 19, 2014, deposition. One of those places to wager, Rubinsky said, was a Costa Rica-based sports book named Tradewinds, where he said he helped Zayat get a $3-million line of credit to bet on sports. He earlier set Zayat up to wager at Pinnacle Sports in Curacao, Rubinsky said in his sworn deposition, adding that Zayat won $1.4 million in a short time and was banned by the owner of the sports book because ?he?s too sharp, I don?t want this kind of business.?
Rubinsky said Zayat lost $2 million at Tradewinds in 2003, paid approximately $350,000 to the casino, then refused to pay the remaining balance. In 2008, after Rubinsky said he pursued Zayat for what he alleged was the outstanding balance to Tradewinds, Zayat paid Rubinsky $25,000 via a check from the Zayat Foundation to Rubinsky?s sister. Zayat said in his deposition the payment was made to help Rubinsky get through a health problem. ?I said I was going to help him to make payment toward his medical care, and if he needs money to eat I am happy to help him every week with money to eat,? he said in his deposition.
Zayat, both in interrogatories filed with the court and in a Nov. 11, 2014, deposition, denied all of the allegations. ?I never placed sports bets through the Internet or telephone (or any other means) at Pinnacle or Tradewinds, or any other online-telephone sports betting venue, either directly or through the Jelinskys,? Zayat said in a sworn declaration.
Zayat admitted that he bet with the Jelinskys in 2007 while in California, and in his Zayat Stables bankruptcy filing in 2010 there are payments to the Jelinskys listed as personal loans to them.
In May 2008, Zayat received a visit from a special agent with U.S. Office of Homeland Security and an investigator with the Nevada Gaming Control Board concerning his wagering with the Jellinskys. He learned during that visit, listening to a taped conversation provided by the officials, that he was being scammed by the brothers.
In his deposition, Zayat said: ?They put on a tape which was a conversation between the two brothers supposedly trying to scam me. Remember, I told you that there was a summer, I believe it was either 2007 or something of that nature, where that summer where I was not able to bet on my own personal accounts because I was in California, and in California you can?t bet online at a California track. That was the law. And there, I was betting my horses through Michael, and Michael was apparently giving me horses that he personally liked, okay. And these horses were being put in supposedly in the pools, but they were actually ? the two brothers was conspiring and booking these bets. Meaning let?s say that they really like, legitimately they are betting the race themselves, they like one, two, three. They were on purpose giving me five, six, seven. They are telling me to bet it. These bets were never actually put on in the pools. They are booking these bets so these horses were being not correct. So I would lose because they are giving me the wrong horses. But even these were not a ? they were not putting the money in the pool that I thought it was. It never ? it went into their own pocket. So they developed a scam and they made me hear the conversation between the brothers plotting how they are actually going to do that by one calling me and telling me that he liked that, that, that, and then putting these bets.?
iStable.com
His relationship with the Jelinsky brothers was a red flag to several racing commissions, which in 2010 investigated and ultimately cleared Zayat for fitness to be a licensed owner. He was under scrutiny again in 2013 when the owners of a New Jersey harness track alleged Zayat was improperly extended up to $286,000 in credit by the state?s advance-deposit wagering system.
In a written statement about the Rubinsky lawsuit, Zayat said: ?As my family and the racing world awaits watching the brilliant American Pharoah attempt to make history in the Belmont Stakes, there are some who are attempting to cause a distraction with mention of the Zayat Stables reorganization in 2009 as well as bringing up fictitious stories from 11 years ago.
?Some media outlets conveniently fail to report that when Zayat Stables filed for bankruptcy protection, it was a defense against predatory lending practices and broken promises made by a bank. These same members of the media also fail to recognize that Zayat Stables paid 100 percent of its creditors in full and that the bankruptcy had nothing to do with me personally.
?The rhetoric accusing me of owing monies over gambling debts is a pathetic attempt to extort me and we are expecting this meritless lawsuit from a convicted felon to be dismissed.
?My family and I thoroughly enjoy interacting with the thousands of loyal fans who reach out to us in many ways including through social media and will continue to do so. We recognize that there will be people who attempt, often through false, desperate measures, to take attention away from American Pharoah, his Hall of Fame trainer Bob Baffert, and brilliant jockey Victor Espinoza. Our family is grateful for this incredible expeeience and will continue to enjoy the ride along with the colt?s legion of fans.?
The Rubinsky lawsuit has received considerable media exposure over the last 24 hours, including this piece in the New York Times that goes into the matter in further detail.
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