GamblingCompliance: Nevada Gaming Commission Backs Swift Casino Game Approvals

21ST OCT 2016 | WRITTEN BY: CHRIS SIEROTY

Getting new games, whether they are games of skill or chance, on the casino floor in Nevada just got a little easier after the state’s gaming commission on Thursday approved new rules for a streamlined field test process.

The five-member commission approved amendments to Regulation 14 that would create a New Innovation Beta (NIB) process intended to speed up the development of new games by letting manufacturers quickly test their products in casinos.

Currently, gamemakers use field trials to see if their products can stand up to everyday use and to see if gamblers find them understandable and fun to play.

However, games are required to meet all of Nevada’s regulatory standards before field trials can begin.

Then NIB process does away with that requirement.

“This new program shows the [Nevada] Gaming Control Board’s progressive vision for introducing new concepts and technologies and will allow the slot manufacturers to manage their research and development effort to maximize their product offerings and speed to market,” Marcus Prater, executive director of the Association of Gaming Manufacturers (AGEM), told GamblingCompliance.

AGEM, a Las Vegas-based international trade association, worked with Nevada gaming regulators to develop the new regulations.

“Ultimately, the entire industry will benefit as operators and suppliers work together, and players can try new games sooner and vote with their wallets on what the casino floor will look like going forward,” Prater said.

Another change is regarding notifications to gamblers that they are actually testing a new game.

During the regular field trial, gamblers may be told but it is not mandatory, according to the Nevada Gaming Control Board (NGCB). However, regulators say that changes with NIB mean that now gamblers will be told they are testing a game.

A.G. Burnett, as chairman of the NGCB, will make the decision whether or not to allow a manufacturer into the NIB process, according to the 12-page draft of the proposed amendment to NGC Regulation 14.

The new rules also restrict testing of a new gaming device to no more than 180 days. Chairman Burnett can approve an additional 90 days of testing beyond the maximum field test period.

Alongside traditional slots game suppliers, developers of skill-based games are also looking forward to using the new testing rules.

“GameCo will be making our Nevada license application in the next 30 days,” Blaine Graboyes, CEO of GameCo, told GamblingCompliance in an email Thursday.

“We’re thrilled to be bringing our product to Nevada,” Graboyes said. “As the first skill-based video game gambling product approved by any U.S. gaming regulator, we expect to be a leader in the Nevada market too.”

GameCo is deploying its skill-based slot machines on casino floors at three Caesars Entertainment properties in Atlantic City. The machines, called VGMs, are undergoing several weeks of testing.

Graboyes said GameCo’s goal is to launch products as soon as possible in Nevada.

“We plan to leverage the New Innovation Beta program to speed our deployment to casino floors,” Graboyes said.

Fellow skill-based start-up Gamblit Gaming debuted six skill-based gaming positions with room for four players each this month inside of Harrah’s Rincon, a casino that Caesars manages in southern California.

The plan is to then field trial games at Caesars’ Nevada properties shortly afterwards. Caesars anticipates deploying 125 Gamblit games into multiple properties from next year.

“We couldn’t have asked for a better deployment channel,” said Ivan Souffront, director of Compliance & B2C Operations at Gamblit. “This reg change represents Nevada’s commitment to the future of gaming and an opportunity for Gamblit to deliver the content that players are hungry for. We build our products from the ground up and it used to take months before a new product could hit the casino floor.  The NIB process will allow us to do what used to take months in weeks or even days.”

Souffront told GamblingCompliance in an email that Gamblit is working on a variety of games and devices right now, and “we plan to wholeheartedly embrace the NIB program.”

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KNPR’s State of Nevada – Gaming Companies Look Toward The Future At The Global Gaming Expo

Here is a link to my apperance on KNPR’s State of Nevada program talking about what was new at Global Gaming Expo: http://knpr.org/knpr/2016-09/gaming-companies-look-toward-future-global-gaming-expo

The Global Gaming Expo is taking place this week.

It’s sort of like a trade show for the gaming industry.

They are taking in the latest technology for slots machines and table games.

Meanwhile, gaming honchos will talk about what’s coming down the road for gaming.

Chris Sieroty is U.S. editor with GamblingCompliance

INTERVIEW HIGHLIGHTS:

Last year, skilled based games were supposed to be the wave of the future. Have they arrived yet?

I think it is, because on the gaming floor there are companies like Gamblit Gaming, GameCo, these smaller firms that are actually announcing they’ve reached agreements to test games in casinos. GameCo in Atlantic City I think just came out on Monday. And now, they have these big exhibits.

For Gamblet Gaming, they’re exhibiting two new games off of some downloaded games like “Into the Dead” and “Catapult Kings.” “Into the Dead” has been downloaded some 60 million times and now they’re premiering gamblized versions of these games all in an effort to attract a new crowd into the casino.

On efforts to attract Millennials but keep Baby Boomers and Gen-Xers:

There is an effort to attract them but there is also an effort to please Baby Boomers and the Gen-X crowd. You have the “Seinfeld” game coming out as just one example of the industry trying to maneuver into attracting a new generation into the casino while not losing the people who gamble.

Do those themed slot machines actually work?

Yeah, I think so. They feel comfortable with it. They like the sound, the music, whatever. The voice. The games are designed to attract you to put money in, we all know this. I think these games do. Wheel of Fortune is one of the most successful slot machines ever.

E-Sports is another area that looks like it is growing. E-Sports is where people play video games and other people watch. People are already betting on those matchups just like they do Sunday football games. Is that section of the industry going to keep increasing?

I think it is going to keep increasing. The idea is to bring all these different leagues under one roof and have a commissioner or league office that oversees E-sports. So you’re not having one contest between three people or two teams playing… “Call of Duty” and they want to make it like the NBA.

Downtown Grand has made a huge effort. Seth Schorr, who runs that casino-hotel, has made a huge effort to attract people with games where you can win prizes. They haven’t really gamblified it yet here but I’m sure that’s coming down. There’s another place on Fremont Street that is going to be opening up for E-sports.

It’s early. It’s early in the U.S. for these games and forming a relationship and really making sure there are legitimate ways to bet on these that people aren’t going to be taken advantage of.

What is the future of daily fantasy sports?

You have so many companies spending so much money to try to attract more players. That’s what you have to do.

Set aside U.S. Fantasy from Draft Kings and Fan Duel, those are different. U.S. Fantasy you’re betting with odds. It’s a pari-mutuel system like when you go to the race track you bet the favorite two-to-one… It’s a different form than Draft Kings or Fan Duel.

In terms of U.S. Fantasy, they’re looking to bring it to other states. I know they’ve looked to bring it to casinos in Pennsylvania. There are other states they could go into like New Jersey.

Fantasy sports, you have the people playing it. It’s here. I think the push now from AGA, or American Gaming Association, is to legalize sports betting.

Is accepting the fact that gambling and sports go hand in hand something that’s getting discussed this week?

I think David Stern [former NBA commissioner] is here to announce his support for legalized sports betting, following the current commissioner Adam Silver’s opinion piece in the New York Times about a year ago. I think they’re going to come out and say, ‘look we need to do this.’

If you talk to the AGA, the line is ‘it’s a $150 billion in illegal betting,’ and they say that’s a conservative market. It’s an ongoing subject. They’re waiting for the election to be over and start again to see if they can overturn the federal ban on sports betting.

On the new type of machine that takes bets in different currencies:

The company’s name is JCM Global and they have a product called Fusion. It’s like a little part of an ATM that goes into the slot machine where you put your card in. Say you’re here from Germany and you have a Euro and you don’t want to change it out, or there’s no place to change it out. You can put it into the machine and the machine will allow you to bet in dollars. You can make a sports bet from there. So you don’t have to get up and go to the sports book and make a bet.

This is all about convenience. This is all about getting you to stay at that machine to play longer. If you hit a jackpot, you put your card in. It has all your personal information and it shoots out your IRS forms. It’s a little Big Brother-ish but this is the way that they’re going.

Is it a big deal to see non-gaming revenue as a focus of a seminar at this conference?

When I was at the East Coast Gaming Conference, it was a big topic there. You have a lot of companies realizing, ‘oh wait, we gotta upgrade this, because this is a revenue source.’ Are there the traditional slot parlors where people can just come in and play? Yes. But you see a lot of focus on new restaurants, new bars and it is important. Every year at G2E there is a huge area set off for the latest food. What’s available for to serve in your casino. It is important.

GamblingCompliance: Nevada’s Mesquite Gaming Seeks Stricter AML Reporting For Sportsbooks

6TH OCT 2016 | WRITTEN BY: CHRIS SIEROTY

The Nevada Gaming Control Board on Thursday will consider a petition filed by a small Nevada gaming company that seeks to have regulators tighten reporting requirements for cash payouts at satellite sportsbooks across the state.

The three-member control board will consider Mesquite Gaming’s petition to amend Nevada Gaming Commission regulations to require satellite sportsbooks that are not subject to federal anti-money laundering (AML) reporting requirements to submit a “Satellite Sports Book Payout Report” to Nevada regulators.

The report would cover all non pari-mutuel payouts of $10,000 and higher or that aggregate to more than $10,000 during the designated 24-hour gaming day, said Mesquite Gaming’s corporate compliance officer Catherine Catanzaro.

Currently, satellite sportsbooks that have annual gross revenues of less than $1m are required to report any wagers in excess of $10,000 to the Internal Revenue Service (IRS).

But instances of cash payouts exceeding $10,000 are not required to be reported.

As a result, Catanzaro said, a gambler could wager less than $10,000 and win more than $10,000 but there is no need to report these transactions to either the IRS or the Nevada Gaming Control Board.

“We believe the current practice of exempting these satellites from reporting winning sports wagers of $10,000 or higher facilitates money laundering, increases the risk of criminal activity through third-party betting … and could potentially damage the integrity of gaming” in Nevada, Catanzaro wrote in the petition filing.

Catanzaro asked regulators to consider changing Nevada regulations to make satellite sportsbook operations that do not exceed $1m in annual gross gaming revenue to be subject to Title 31 reporting.

Under the federal Bank Secrecy Act, licensed casinos, card clubs and sportsbooks are required to submit reports on all gambling transactions over a certain size or are apparently suspicious to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN).

However, the reporting requirements of the act, also known as Title 31, do not apply to gaming companies making less than $1m in annual revenue.

Mesquite Gaming owns the Casa Blanca and Virgin River casinos in Mesquite, which is about 100 miles north of Las Vegas. The Eureka casino is the only other casino in Mesquite.

In July, Mesquite Gaming CEO Anthony Toti sent a letter to FinCEN asking for a broader definition of what is understood to be a casino under the Bank Secrecy Act.

Toti also wanted a ruling on what constitutes the “principal headquarters” as it pertains to the satellite sportsbooks, including those run by William Hill and other companies.

Although the letter to FinCEN does mention CG Technology, it is clearly William Hill that Toti believes has an unfair competitive advantage.

“Our in-house sportsbook operation, subject to Title 31 reporting, is significantly impacted by this regulation as our competitor’s book, Eureka Hotel and Casino, is a satellite operation licensed to William Hill with gross sports revenue of less than $1m and therefore is only required to complete [IRS] Form 8300 for cash wagers over $10,000,” Toti wrote.

William Hill operates 104 of the 190 licensed sportsbooks in Nevada.

Toti said William Hill’s satellites “should not be permitted to evade reporting under Title 31,” as the definition includes the term “principal headquarters,” which he believes should refer to William Hill as the company that is licensed by the state to operate the satellites.

“I also believe that the current practice of exempting these satellites from compliance with Title 31 and Suspicious Activity Reporting (SAR) increases the risk of criminal activity through third-party betting, facilitates money laundering and severely hampers the efforts of law enforcement in identifying criminal activity,” Toti wrote.

He added that “this situation created an unfair advantage to William Hill over in-house operated books in Nevada subject to Title 31.”

Today’s hearing in Nevada comes just a few days after sportsbook operator CG Technology was fined a total of $22.5m by federal regulators, including FinCEN, over “egregious and systemic” AML violations.