David and Ofer Baazov: crimes, frauds and no punishment
Trading using insider information
David Baazov started his path in gambling from software development, founding Amaya Gaming company in 2005. The company grew rapidly: in 7 years David made a billion-dollar deal and bought the Rational Group brand (owned PokerStars and FullTitl). This came to the attention of state regulators of Great Britain and Canada, later the Financial Markets Commission initiated searches in the offices of David’s company. The Commission filed charges: “Trading using insider information.” David Baazov was not able to disprove it, he was fired from the CEO’s position at Amaya. To save the reputation of the company, new executives had to change its name to Star Group.
After the first high-profile scandal Ofer Baazov (David’s brother) entered the gambling arena. His name came out in the investigation process: with the data received from David, Ofer earned about 1.5 million dollars. The scheme was simple: David stole insider information, passed it to the brother, and Ofer (together with a partner Levett) provided it to interested parties.
It should be noted that Ofer’s reputation had not been perfect before this case. Ten years earlier, he was associated with the disappearance of 1 million dollars deposited by users of the BetonUSA website that went bankrupt.
Charity fraud and civil suits
In 2017 came to light one more fraud case involving David Baazov. Representatives of Lion’s Heart Self Help, a non-profit organization based in Africa, disclosed information about fraudulent lotteries organized by Amaya subsidiaries in 2010 in Kenya. According to the announcement, 25% of donations had to be allocated to charity, but that did not happen. The amount of money was deposited by Baazov brothers in Kenyan NIC Bank to be withdrawn abroad later.
It seems that such a story will be incomplete without civil suits. David Baazov participated in them as well. In 2017 Kalani Lala, president of the investment company KBC Aldini Capital took legal action against David accusing him of illegal usage of his (Lala`s) name and signature. Kalani Lala reported that such actions resulted in his reputation damage and deterioration of relations with business partners (mainly Muslims) who prefer not to deal with the gamblers and businessmen working in this field.
The unique case in the Canadian court
Moreover, in 2018 the name of David Baazov was involved in the cases of not paying salaries for the employees and compensations to investors affected by him. Let us start with the salaries. That year, Star Group received charges from Gideon van Kessel, a consultant and strategic advisor. According to Kessel, David hired him to Amaya Inc. The company stopped paying salaries to Kessel and several other employees in 2014 when the Quebec securities regulator started to monitor the business activity of the company.
As for the compensations, this incident is truly unique in the Canadian court system. In 2018, David Baazov was under proceedings in the Canadian court, and his lawyers received 320,000 confidential documents from the prosecutors with the request to give them back. This procedural error led to closing the case. David and his company still have to pay 30 million dollars compensations to those investors who were affected by the disclosure of the confidential information.