Civil suits may get more scrutiny from Nevada Gaming Control Board

Feb 20, 2018 3:00 AM

It is always a challenge to have a conversation with current and former Nevada Gaming Control Board agents, members or commissioners about contemporary topics. Not that they are unwilling to talk, but they are unwilling to be quoted and do not want anything coming back to them or on them that could bring the ire of the respective Chairs or division chiefs.

One would think those who left the board would be more relaxed about being quoted. But as a number of them have ongoing gigs with existing gaming licensees they do not want anything to interfere with those relationships as they are generally paid rather handsomely for their credibility, accesses and knowledge of the inner workings of the regulatory processes.

So out of respect for their individual requests for anonymity and declinations to be directly quoted, the following is a consensus of some of the conversations, speculations and opinions of a few persons with intimate knowledge of past and present processes of the Nevada Gaming Control Board and Commission regarding the Wynn matters.

In general, the Board and Commission try to avoid getting involved or over scrutinizing civil actions and generally look at them in hindsight and in light of other concerns or lack of concerns in a gaming licensee’s application with an eye toward any impact on licensing suitability.

Generally, once a licensee has an active gaming license and a civil litigation matter comes up, it would require something very significant in the civil matter to trigger a licensing update or an in depth review. As the licensee has already been approved there is great discretion by the concerning division head and respective Chair whether they will want the matter pursued.

Given the regulatory embarrassments and questions swirling around the Wynn matter, that past practice might just change.

As a few people put it, a regulatory body with full-time investigative staff should not have been surprised by a newspaper story that originated from publicly accessible information in a civil case between two very prominent gaming licensees (referring to Elaine and Steve Wynn).

Others pointed out, while it will be hard to prove allegations either way about what happened or did not happen in the privacy of an office or hotel room, if a settlement was made and not disclosed or the money trail of the settlement was clouded to avoid reporting then the burying of the activity would, though politically incorrect to say it, for regulators, be as bad or worse than the underlying indiscretions/claims.

Odd thing about Nevada gaming regulators, screw up and be up front with them about it and they will weigh the honesty very heavily in their decisions; hide something and the wrath will be heavy if not license-ending.

To the question of what long term changes to expect out of the regulatory process from the Wynn matter, the consensus was, likely, going forward the details of a civil matter involving gaming licensees will be concurrently compared to the licensee’s applications and woe to those whose facts in court do not match representations on their gaming applications.

If the practice of concurrent examination of civil actions being compared to license applications becomes a standard, there are more than one current civil matters, un-related to Wynn, that many cause one or more of its participants to start sweating.

Pursuing integrity fee

It appears the NBA and MLB are starting to sing from the same sheet of music in their pursuit of a percentage of the wagers made on their respective sports. For those states considering allowing sports wagering, if the U.S. Supreme Court does rule against the federal ban on sports wagering, the two leagues are asking for 1% of the gross wagers made on their sport as an integrity fee.

The notion behind the integrity fee is presumably to help the leagues keep the games honest. Since the leagues already spend money to assure the games are clean, I wonder if they would commit to return any unspent money supposedly collected under the integrity fee banner if not spent for the purported purpose.

While the sports wagering industry has been focused on the overturning of the federal ban, the leagues have been starting to go state by state to lobby for their interests and percentage of the action. If the industry does not get together in an organized way to provide good counter arguments on that same state by state basis, the industry might lose the fight over the integrity percentage before it even gets in the ring.

Cantor v. Asher update

For those who have been following the very long running court battle between Cantor and Joe Asher of William Hill, the fight isn’t over yet.

Cantor has appealed the surprise verdict against them and the case now shows every sign the fight will last longer than World War II.