San Jose Municipal Code Part 1 Regulatory Action Procedures

A. The procedures set out in this chapter shall apply to all regulatory actions that the administrator is authorized to take against cardroom permittees and licensees.

B. For purposes of this chapter, the person who is the subject of the regulation action means the cardroom permittee or any licensee that is charged with wrongdoing.

(Ord. 28517.)

Any cardroom permit issued under the provisions of this title shall be subject to regulatory action on any of the following grounds:

A. The cardroom permittee or any stock ownership licensee has violated any provision of this title or any provision of Chapter 4.77 of Title 4 of this Code.

B. The cardroom permittee or stock ownership licensee failed to timely pay any fees due under this title.

C. The cardroom permittee or any stock ownership licensee has violated any term or condition of either the cardroom permit or the stock ownership license.

D. The cardroom permittee or any stock ownership licensee has committed acts constituting a violation of:

1. State gambling law; or

2. Any federal law substantially related to the qualifications, functions, or duties of the cardroom business or gambling business; or

3. Any law of any other state or territory of the United States relating to the qualifications, functions, or duties of the cardroom business or gambling business.

E. The failure or refusal of any cardroom permittee or any stock ownership licensee to make and file any statements as required by this title within the time required or to timely pay any sums due under the tax provisions of Chapter 4.77 of Title 4 of this Code.

F. The cardroom permittee or any stock ownership licensee supplies information to the administrator that is untrue or misleading.

G. The cardroom permittee or any stock ownership licensee has knowingly made false statements on any filing, registration or statement required under this title.

H. The cardroom permittee or any stock ownership licensee has committed any acts involving dishonesty, fraud, or deceit with the intent to substantially benefit the cardroom permittee or any stock ownership licensee or another, or to substantially injure another.

I. The operation of the cardroom violates the city's Zoning, Fire, or Building Codes or other ordinances or regulations, or applicable state laws or regulations relating to the operation of the premises.

J. The operation of the cardroom substantially aggravates the crime problems in the area, makes law enforcement unduly difficult, or is otherwise detrimental to crime prevention or is detrimental to the public peace, health or safety in the area.

(Ord. 28517.)

All licenses issued under the provisions of this title shall be subject to appropriate regulatory action on any of the following grounds:

A. The licensee has violated any provision of this title or any provision of Chapter 4.77 of Title 4 of this Code.

B. The licensee has failed to timely pay any fees due under this title.

C. The licensee has violated any term or condition upon which the license was issued.

D. The licensee has committed acts constituting violation of:

1. State gambling law; or

2. Any federal law substantially related to the qualifications, functions, or duties of the cardroom business or gambling business; or

3. Any law of any other state or territory of the United States relating to the qualifications, functions, or duties of the cardroom business or gambling business.

E. Failure of the licensee to establish his or her continued eligibility and qualifications for licensing under the affirmative criteria for licensing set forth in Chapter 16.32.

F. Failure to provide information, documentation, and assurances required by the administrator to demonstrate the licensee's continued qualification for licensing.

G. Failure to reveal any material fact relating to the licensee's continued qualification for licensing.

H. The supplying of information which is untrue or misleading.

I. A felony conviction, including by a plea of nolo contendere, or a conviction by any federal court or a court in another state for a crime that would constitute a felony in California.

J. A misdemeanor conviction, including by a plea of nolo contendere, or a conviction by any federal court or a court in another state for a crime that would constitute a misdemeanor in California, involving dishonesty, moral turpitude, prostitution, sale or possession for sale of a controlled substance, gambling, or any other crime substantially related to the qualifications, functions, or duties of the cardroom business or gambling business, within a ten-year period immediately preceding the submission of the initial licensing application or renewal application.

K. Association of the licensee with criminal profiteering activity or organized crime as defined in the California Penal Code Section 186.2 of the California Control of Profits of Organized Crime Act, Penal Code Sections 186 et seq.

L. Contumacious defiance by the licensee relating to any legislative investigative body or any other investigative body in any state of the United States.

M. The licensee is a partner, officer, director or shareholder or has any financial interest in any business organization that engaged in any form of prohibited gambling pursuant to the California Penal Code whether within or outside of the State.

N. Denial, revocation, or suspension of a state gambling license, key employee license, work permit, registration, or finding of suitability pursuant to state gambling law or the denial, revocation, or suspension of a regulatory license for lawful gambling in any other state.

O. The commission of acts involving dishonesty, fraud or deceit with the intent to substantially benefit him or herself or another, or substantially injure another.

P. The licensee is less than twenty-one years of age.

(Ord. 28517.)

A. The Administrator shall make appropriate investigations to determine whether grounds may exist for regulatory action. If an investigation cannot be concluded and a notice of Regulatory Action served in accordance with Section 16.34.060 of this Chapter within one hundred and eighty (180) Business Days after the date of discovery by the Administrator of the incident and/or circumstances that precipitated the investigation, the Administrator shall inform the Chief of Police in writing of the focus of the investigation and an estimated date for completion of the investigation. Thereafter, the Administrator shall provide the Chief of Police with a written status update on a monthly basis until the investigation concludes.

B. Prior to serving a notice of regulatory action, the Administrator shall provide the Cardroom Permittee or Licensee who is the subject of the investigation with the opportunity to meet with the Administrator in order for the Administrator to inform the Cardroom Permittee or Licensee generally of the basis for the proposed action.

C. If, after investigation, the Administrator is satisfied that grounds exist for a regulatory action hearing, the Administrator shall file a notice of regulatory action in accordance with Section 16.34.060.

(Ords. 28517, 30616.)

A. In determining the appropriate regulatory action to take against a person who is the subject of the regulatory action, the administrator may consider, but is not limited to, the following mitigating and aggravating factors:

1. The seriousness of any crimes constituting grounds for regulatory action for which the person who is the subject of the regulatory action has been convicted including, but not limited to:

a. The fines, jail or prison sentence, other punishment, restitution, and fees imposed by the court;

b. How much of the sentence was completed;

c. Whether the person paid his or her fines and provided full restitution to the crime victims;

d. Whether the person paid any other costs imposed by the sentencing court.

2. The nature of the conduct constituting the grounds for regulatory action.

3. The duration of the conduct constituting the grounds for regulatory action.

4. The numbers of instances of conduct constituting the grounds for regulatory action and whether or not the conduct is part of a pattern of misconduct.

5. Whether the conduct constituting the grounds for the regulatory action was deliberate or inadvertent.

6. The degree of injury to any victim, including the city, either financial or physical, caused by the conduct giving rise to the grounds for regulatory action.

7. The motivation of the person who is the subject of the regulatory action.

8. Restitution provided to the victim.

9. Whether the violations are continuing in nature.

10. Prior regulatory violations of this title, of Chapter 4.77 of Title 4 of this Code, or of state gambling law, and any regulatory action ordered pursuant to this title or any regulatory or other enforcement action taken by the state pursuant to the state gambling law.

11. Voluntary corrective action taken to correct the grounds for regulatory action prior to the regulatory action hearing.

12. Any other mitigating or aggravating circumstances the administrator may consider applicable.

B. In addition to the considerations set forth in Subsection A., the administrator may also consider the following additional mitigating and aggravating factors with regard to cardroom permittees that are subject to regulatory action:

1. Any criminal convictions of the cardroom permittee, or any stock ownership or key employee licensee, involving any crimes that would constitute grounds under this title for the denial, suspension, or revocation of a stock ownership or key employee license.

2. The commission of any act by the cardroom permittee or any stock ownership or key employee licensee, involving dishonesty, fraud or deceit with the intent to substantially benefit himself or herself or another, or substantially injure another.

3. Whether the cardroom permittee or any stock ownership or key employee licensee, has previously operated in this or another state under a gambling, gaming or similar license or permit that has been revoked or suspended, the reasons therefor, and the actions of such person thereafter.

4. Whether the cardroom permittee or any stock ownership or key employee in this or another state has been denied a gambling, gaming or similar license or permit, the reasons therefor, and the actions of the person thereafter.

5. The business and credit history of the cardroom permittee and stock ownership licensees.

(Ord. 28517.)

A. If a regulatory action is imposed, the Administrator shall serve on the Cardroom Permittee or Licensee a notice of regulatory action. The notice shall state:

1. All the grounds for regulatory action;

2. The regulatory action and a statement of the reasons for the regulatory action, including all the aggravating and mitigating factors that the Administrator considered relevant to his or her decision; and

3. The name of each person who committed the alleged violation, if known.

B. The notice of regulatory action shall become a final decision effective twenty-one (21) calendar days after service of the notice of regulatory action upon the person who is the subject of the regulatory action unless the person who is the subject of the regulatory action files a written request for a regulatory action hearing with the Administrator before the close of business on the twentieth day.

(Ords. 28517, 30616.)