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Don't go too hard on him until the facts are actually known.

I used to host home games at my house. They were quasi-legal because I didn't take a rake and no one was allowed to tip the dealer, a dealer who wanted to break into the cardroom at a legit casino nearby. It wasn't easy at the time to get into a cardroom because it's so lucrative so a lot of these people were blackjack dealers who wanted a lateral move. This was right before and at the beginning of the "Poker Boom" characterized by people like Chris Moneymaker. I stopped soon after because so many other people were hosting the parties that I didn't have to host to get my action.

BYOB and a few of us regulars would chip in for something like a 6ft sub sandwich or catering type nachos. I'd have a couple racks of soda and everyone was free to raid the fridge if they didn't like the food. We often would tip the dealer $5-10 each at the end of the night, a big winner might have tipped $50 (this is the only reason it was quasi-legal and not actually legal). However, we were also playing $0.10/$0.25 no-limit holdem so a big big pot would be $100. Like that pot would happen maybe once every four sessions. None of us were rich. I would always stop someone from spending more than say $2-300 if I knew they were working class like me, got drunk and went on tilt.

These people are rich, they want a home game with catered food, free drinks, concierge service. They want that home game experience with high end tastes instead of going to California's shitty cardrooms. I really doubt if dude was making any money from the whole thing. Thing is, California is crazy with their home gaming rules. I'm not even sure my game would have been tolerated.