- Associated Press - Friday, February 12, 2016

SPARKS, Nev. (AP) - A Nevada gaming control commissioner resigned Friday after details of a federal investigation surfaced involving The Nugget in Sparks that was under the ownership of her family.

Gov. Brian Sandoval said Michonne Ascuaga resigned her position as a member of the Nevada Gaming Commission on Friday.

Her letter said she was resigning to avoid having her family’s “on-going business litigation” distract from the regulatory work of the commission.

The letter said in part: “I always tried to conduct myself with the highest standards of professionalism consistent with the tradition members of this body have followed past and present.”

The governor said in a statement: “I appreciate that she has put the credibility and reputation of the Gaming Commission first. Michonne is a consummate professional and will continue to be a leader in our community.”

Sandoval appointed her to the commission last April. Ascuaga was the CEO of The Nugget for 16 years until it was sold. Her father founded the hotel-casino in 1955.

The federal investigation came to light as part of an ongoing legal dispute between the Ascuagas and Wolfhound Holdings LLC, the company that purchased the hotel-casino in 2013.

An investigation by the Financial Crimes Enforcement Network was detailed in a lawsuit filed Wednesday by Wolfhound Holdings in Washoe District Court.

The holding company suggests the Nugget was investigated for failing to meet federal record-keeping and reporting requirements and for not establishing an effective anti-money laundering program.

The status of the investigation was not revealed in interviews or in documents.

Ascuaga said in a statement that she was never the target of the investigation. She said she has not had any contact with investigators since November 2013.

“The Sparks Nugget was informed in November 2013 by the Department of Treasury that the department was investigating whether it was appropriate to impose civil penalties for possible violations of anti-money laundering regulations,” she said in the statement. “The matter arose from an audit-type examination conducted by the IRS at the casino in 2010. This was all disclosed immediately to the buyer.”

She said after the sale, Wolfhound Holdings assumed the responsibility of resolving those issues with federal regulators.

Nugget spokesman Joe Sala said the hotel-casino’s owners have no comment on the matter.

The dispute between Wolfhound Holdings and the Ascuaga family started in January 2015 when the family filed a lawsuit against Wolfhound, claiming they were still owed money under the purchase agreement.

John Echeverria, the Ascuagas’ attorney, said Wolfhound Holdings knew about the problems the property was facing before the purchase.

This story has been corrected to show The Nugget is in Sparks, Nevada, not Reno.

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