Pressure on Casino Executives and Regulatory Lapses
A gaming lawyer and former UNLV professor, Anthony Cabot, noted that the demand for revenue among casino executives has led establishments worldwide to overlook criminal activities. Resorts World Las Vegas is among those facing repercussions, having recently been fined $10.5 million—the second highest in Nevada’s history—for not adhering to federal anti-money-laundering regulations, allowing illegal bookmakers to place large bets.
Severity of the Penalty
Cabot stated the fine’s magnitude, part of a stipulated settlement to be reviewed by the Nevada Gaming Commission, is not surprising. It ranks second only to the $20 million penalty imposed on Wynn Resorts in 2019 for neglecting to investigate sexual misconduct claims against its ex-CEO, Steve Wynn. “In recent years, the Gaming Control Board has been imposing hefty fines on larger casino operations,” Cabot remarked during his discussion on casino ethics at the World Game Protection Conference in Las Vegas.
Wynn Resorts’ Settlement
In a notable case, Wynn Resorts agreed to pay $130 million to the federal government to resolve allegations of collaborating with unlicensed money-transmitting businesses globally. The Gaming Control Board has not yet taken additional action against Wynn despite the federal penalties.
Consequences for Executives
Furthermore, in December, the gaming license of Scott Sibella, former president and COO of Resorts World Las Vegas, was revoked after he pled guilty to federal charges related to failing to report illegal gambling activities at MGM Grand in 2018.
Global Regulatory Issues
Cabot emphasized the pressing need for the casino industry to rethink its regulatory strategies, citing a troubling trend of prioritizing revenue over compliance and ethics. Australia has been grappling with money-laundering issues for the past year and a half, involving criminal syndicates from mainland China gambling with companies like Star Entertainment and Crown Resorts. Crown faced a significant penalty of $300 million in July 2023 for regulatory failures.
Concerns Over Regulatory Entities
Cabot criticized Australian regulators for failing to revoke gaming licenses in light of serious violations, arguing that allowing companies to remain operational sends a dangerous message. He expressed disappointment with the message that established casino firms might be “too big to fail,” a perspective that undermines compliance incentives.
Future of Compliance in Nevada
For Nevada, Cabot believes the situation is notably better than before the implementation of anti-money-laundering laws, but acknowledges room for improvement. He warned that ensuring accountability is essential, suggesting that regulatory authorities need to target responsible individuals rather than penalizing the companies indiscriminately.
Due Diligence and Ethical Practices
Resorts World’s case is not directly tied to global money laundering issues; however, Cabot emphasized the importance of conducting thorough due diligence to prevent illicit financial transactions. While past problems such as clandestine cash transactions have lessened significantly in Las Vegas since the introduction of federal AML regulations, he expressed alarm at ongoing issues in other regions, thereby highlighting the stark contrast in regulatory landscapes globally.
