Posts by sierotyfeatures

My name is Chris Sieroty, and I’m U.S. Editor with GamblingCompliance in Washington, D.C. We are a trade publication covering the gambling industry. Previously, I was a producer with KNPR’s State of Nevada news program, as well as a contributing writer with Nevada Business magazine, and the banking and finance columnist with the Las Vegas Business Press. Prior to joining KNPR, I was a gaming and banking reporter with the Las Vegas Review-Journal and Las Vegas Business Press. I also was the Banking Insider columnist for the Las Vegas Business Press. This blog allows me to post stories that have been previously published in various newspapers and magazines, while also allowing me to publish original content on subjects that interest me from sports to politics and whatever else amuses me. You can contact me at

GamblingCompliance: MGM Buys WNBA Team As Sports Settle In Las Vegas


MGM’s purchase of a Women’s National Basketball Association (WNBA) franchise underlines the rapprochement between professional sports and the casino industry even if it is unlikely to lead to other franchises being acquired by gaming companies, according to a leading sports analyst.

Michael Colangelo, a sports consultant in Los Angeles, called MGM Resorts International’s purchase of WNBA’s San Antonio Stars an “interesting investment,” but he does not expect the casino company to look to acquire another professional franchise.

“Another professional team may be difficult,” Colangelo told GamblingCompliance on Thursday. “This could theoretically be to test to see how it works out. The billion-dollar investment would be difficult with their current debt structure.”

As of June 30, MGM’s outstanding debt stood at $13.3bn.

“MGM would most likely want to own a team in Las Vegas. The National Football League (NFL) is already moving there. The National Hockey League (NHL) is already there. There aren’t many options,” said Colangelo, assistant director of the Sports Business Institute with the University of Southern California’s Marshall School of Business.

MGM on Wednesday acquired the San Antonio Stars and will relocate the team to Las Vegas, another move by a professional sports franchise to the nation’s gambling capital.

Terms of the deal were not disclosed.

Colangelo said professional sports leagues will be careful moving into Las Vegas and will continue to monitor and learn from the NHL’s Vegas Golden Knights.

The Golden Knights began their inaugural season this month playing their games at the T-Mobile Arena on the Strip, which is owned and operated by MGM.

“In terms of MGM, we’ve reviewed the problem with raising capital to purchase a team,” Colangelo said. “They would really have to show shareholders true value since National Basketball Association (NBA), NFL and Major League Baseball (MLB) teams are so expensive.”

He added that “any expansion fee would be prohibitive to a publicly traded company.”

Bill Foley, owner of the Golden Knights, paid $500m to the other NHL owners as an expansion fee. When the NHL expanded in 2000 to Minnesota and Columbus each paid just $80m to join the league.

Maybe Major League Soccer (MLS) would work, “if they think that Vegas is America’s next great sport city, but their expansion fee is pretty high,” Colangelo said.

“The NBA could be an option, but that’s a longshot due to the costs associated with an NBA team and the fact that teams aren’t moving. The NFL is not an option since teams must be privately owned by majority ownership.”

NFL owners voted 31-1 in March to allow the Oakland Raiders to move their franchise to Las Vegas by 2020.

“Publicly-traded companies have owned — and do own — professional sports teams, but this is a bit different where a publicly-traded casino company owns a team,” Colangelo said. “The truth is views are starting to shift in regards to gambling.”

The WNBA welcomed MGM’s acquisition of one of its struggling franchises.

“We are thrilled to bring the first major professional basketball team to Las Vegas,” said WNBA president Lisa Borders. “With its culture of diversity and inclusion, MGM is an ideal fit for the WNBA.”

Borders said the move has already been approved by the WNBA and NBA Board of Governors. The Stars franchise was originally established for the WNBA’s inaugural season in 1997 in Salt Lake City before moving to San Antonio prior to the 2003 season.

“We appreciate, now more than ever, the league’s confidence in Las Vegas and believe the team will be a tremendous addition to the city,” said Lilian Tomovich, MGM’s chief experience and marketing officer.

Colangelo believes gaming companies will continue to seek out opportunities to add new entertainment offerings.

“It not only helps them diversify their portfolio, but it also helps them put an event in a building 17 nights a year,” Colangelo said. “There are new venues popping up in Las Vegas at an amazing rate. There is a lot of competition to bring in actual events so these venues aren’t dormant.”

The move is not the WNBA’s first relocation of a team into a casino.

The Connecticut Sun are owned by the Mohegan tribe and play their games at the Mohegan Sun casino-resort.

The Sun used to be located in Orlando, Florida, but financial problems in 2002 left the franchise close to disbanding before the Mohegan Tribe bought the team and relocated them to Connecticut.


PaymentsCompliance: Personal Liability Regime Threatens U.S. Gambling Sector


U.S. enforcement authorities have warned businesses linked to the country’s gambling sector that their appetite for taking action against individuals is growing larger.

“We have been focused on individual liability,” Veronica Agpaoa, an enforcement officer with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN), told delegates at this week’s Global Gaming Expo (G2E) in Las Vegas.

Agpaoa also cited FinCEN’s $1m fine against Sparks Nugget Casino in northern Nevada, reported by sister publication GamblingCompliance, as a “good example of how a culture of non-compliance can impact the company.”

Last year, FinCEN accused Sparks Nugget of “egregiously” violating its anti-money laundering (AML) responsibilities under the Bank Secrecy Act (BSA), including disregarding the recommendations of the casino’s own compliance manager.

The agency also said the casino chose not to file suspicious activity reports (SARs) the manager had prepared and ordered her not to interact with Internal Revenue Service auditors.

Agpaoa described the Thomas Haider case as a wake-up call for the casino industry that made them “think about individual liability” when it came to AML violations.

Haider, the former chief compliance officer of money transmitter MoneyGram, agreed in May to pay a $250,000 civil penalty and be barred from employment in a similar role at any financial institution for three years.

The case had been closely watched by the payments and gambling industries as a test of the federal government’s willingness to punish executives for institutional failures.

Haider was sued by the U.S. government in 2014 for allegedly failing to stop fraudulent transfers and structuring an ineffective AML program.

Vasilios Chirsos, a principal in PwC’s financial crimes unit, credited the gaming industry for taking up the challenge of dealing with AML compliance issues, especially when it comes to increasing corporate spending.

He said gaming companies surveyed by PwC had increased spending on compliance by 74 percent, which “is a remarkable figure.”

Chirsos and Agpaoa participated in an hour-long G2E panel discussion on AML and financial crime compliance on Tuesday.

Chirsos urged compliance officers attending the session to take a risk-based approach to checking their AML programs.

“If I was sitting in your shoes, I would want to get an outside test of your AML program,” Chirsos said. “It needs to be done on a regular basis. You don’t want an independent test that is insufficient and won’t prepare you for an audit.”

John Byrne, an attorney with the Association of Certified Anti-Money Laundering Specialists (ACAMS), said that companies need to invest in employee training and monitoring high-risk gamblers to avoid FinCEN or Internal Revenue Service audits, fines and potential criminal liability.

“We still have room for improvement,” said Byrne, who moderated the panel discussion.

“It starts at the top with internal controls and training,” Byrne said. “Many companies have policies and procedures written down but [they] are never updated or read. It’s important the policy is well understood as part of [your] corporate culture.”

The gaming industry is also being asked to file SARs with FinCEN if they deem a cyber event to be suspicious.

“The [government] has been vague on what information needs to be included when filing a SAR,” said Elizabeth Tranchina, vice president and legal counsel with Pinnacle Entertainment. “We are asking for more guidance. It’s a judgment call for now.”

Agpaoa expected new guidelines soon after discussing the issue with the American Gaming Association (AGA) through a FinCEN committee “to help out policies in the future.”

In January, FinCEN also issued new guidance to clarify when individual casinos may share SARs with their parent companies or affiliates.

FinCEN’s view is that SAR-sharing within domestic offices will enhance a casino’s ability to form a clear and comprehensive understating of the “red-flag” activities engaged in by customers, resulting in more uniform and consistent compliance practices.

Patrick Martin, director of regulatory compliance with the Ohio Casino Control Commission, told about three-dozen attendees that the new policy has resulted in increased sharing of SARs between casinos and enforcement agencies.

GamblingCompliance: Gaming Regulators Struggle To Deal With Legal Marijuana


Nevada’s legalization of medical and recreational marijuana has made it easier for users to buy pot at dispensaries but more difficult for gaming companies that must deal with a wide-range of compliance, employment and ethical issues that result from legal cannabis.

The Nevada Gaming Control Board will not license individuals who run medical or recreational dispensaries, because even though marijuana is now legal in Nevada, it is still considered to be illegal under federal law.

State gaming laws and regulations specifically prohibit behavior by gaming licensees that would discredit the industry.

Nevada gaming regulators believe violating federal law would do exactly that. They are also concerned that the federal government may investigate the state’s multi-billion-dollar gaming industry if it appears state officials are unconcerned about pot use.

“We think that gaming companies should not be involved in medical (or recreational) marijuana now,” Terry Johnson, a member of the Nevada Gaming Control Board, said Monday at the Global Gaming Expo (G2E) at Sands Expo and Convention Center in Las Vegas.

Johnson participated in a panel discussion on the impact marijuana legislation at the state level was having on the gaming industry.

He said regulators were concerned about the co-mingling of cash from any casino business that might be involved in the lawful marijuana sector. Johnson said there is “no banking of pot cash.”

He also expressed concern about gaming assets being the subject of public forfeiture from any legal problems that arise from a company being involved with medical or recreational marijuana on a state level.

Currently 29 states and the District of Columbia have legalized medical marijuana, while eight states and D.C. have legalized recreational marijuana.

“It’s still a Schedule 1 drug, which means it’s illegal for any purpose,” under federal law, said William Bogot, an attorney with Fox Rothchild in Chicago.

Bogot cited the so-called Cole memorandum, issued in August 2013 by then-U.S. Deputy Attorney General James M. Cole, which set expectations for the federal government, state governments and law enforcement on how to deal with states that had voted for, and implemented, legal cannabis programs.

Cole wrote that if states create strict regulatory guidelines to monitor the growth, distribution and sale of regulated cannabis and create a transparent market, the federal government would leave the states alone.

“Recently this has been on shaky ground,” Bogot said. “Attorney General Jeff Sessions has said he does not agree with the Cole memo. So far we are waiting to see what happens.”

Sean McGuinness, an attorney with Lewis Roca Rothgerber Christie in Las Vegas, agreed.

“If there is some challenge, Colorado Governor John Hickenlooper has said he is ready to challenge the federal action,” McGuinness said. “Governor Brian Sandoval in Nevada may be in the same situation.”

Colorado, which is home to both commercial and tribal gaming and legal marijuana, also has strict regulations banning casino operators from doing business with marijuana entities.

“I’ve had operators get in touch with me to ask if they can get involved in the marijuana business,” said Mark Hartman, executive director of the Colorado Department of Revenue.

Hartman has turned them down, saying it is unlawful in the eyes of the federal government.

He also said one individual gave up his gaming license to get into the marijuana business. He declined to identify the person.

Colorado was the first state to legalize recreational marijuana in 2014. But Colorado and Nevada are both struggling to implement rules for marijuana intoxication and responsible gambling.

Johnson said one of the responsibilities a gaming licensee has in Nevada is monitoring for gamblers who might be intoxicated by alcohol.

He said the question of cannabis and responsible gaming should be one of the issues tackled when Governor Sandoval’s Nevada Gaming Policy Committee meets in December.

Sandoval issued an executive order in September summoning the 12-member committee to address the issues surrounding recreational marijuana use and how it affects the gaming industry.

“Since the passage of [2016’s marijuana referendum] Question 2, I have called for Nevada’s marijuana industry to be well-regulated, restricted and respected,” Sandoval said in a statement.

Sandoval said the committee would look at the issues surrounding legal marijuana to protect the state’s “gold standard gaming reputation.”

“Gaming has an outsized economic impact on our state,” Johnson said at G2E. “We have to make decisions to keep that industry strong.”

The policy committee is expected to make its recommendations to the state Gaming Control Board by June 15 next year.

PaymentsCompliance: FinCEN Issues Warning Over Venezuelan Fund Flows


Federal regulators are telling U.S. financial institutions, especially those located in south Florida and Texas, to be aware of Venezuelan officials trying to move or hide illegal assets.  

The Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Department of Treasury, issued a seven-page advisory on Wednesday to alert financial institutions of widespread public corruption in Venezuela.

FinCEN officials believe awareness of money laundering schemes used by Venezuelan officials may help financial institutions to differentiate between illicit and legitimate transactions.

They also expect the assistance to allow financial institutions to identify and report transactions involving suspected illegal proceeds being moved by their customers, including through private and correspondent banking relationships.

“In recent years, financial institutions have reported to FinCEN their suspicions regarding many transactions suspected of being linked to Venezuelan public corruption, including government contracts,” said acting FinCEN director Jamal El-Hindi.

The advisory also describes a number of financial red flags to assist in identifying and reporting suspicious activity. Those red flags are:

  • Transactions involving Venezuelan government agencies and state-owned enterprises (SOEs), particularly those involving government contracts, can potentially be used as vehicles to move, launder, and conceal embezzled corruption proceeds.
  • Corrupt officials may use contacts within the Venezuelan government as vehicles to embezzle funds and receive bribes, including transactions from government contracts into personal accounts.
  • Transactions involving Venezuelan government contracts that are directed to companies that operate in an unrelated line of business. For example, payments for construction projects directed to textile merchants.
  • Transactions for the purchase of real estate, primarily in the south of Florida and Houston, Texas, regions, involving current or former Venezuelan government officials, family members or associates that are not commensurate with their official salaries.
  • Transactions involving Venezuelan government contracts that are directed to personal accounts.

El-Hindi also reminded financial institutions that “not all transactions involving Venezuela involve corruption.”

“But, particularly now, during a period of turmoil in that country, financial institutions need to continue their vigilance to help identify and stop the flow of corrupt proceeds and guard against money laundering and other illicit financial activity,” he said.

FinCEN said the advisory should be shared with private banking units, chief risk officers, chief compliance officers, anti-money laundering and Bank Secrecy Act analysts, sanctions analysts and legal departments.

FinCEN officials also reminded financial institutions of their regulatory obligations under the USA PATRIOT Act to apply enhanced scrutiny to private banking accounts held by, or on behalf of, senior foreign political figures.

They should monitor transactions that could potentially represent misappropriated or diverted state assets, the proceeds of bribery or other illegal payments, or other public corruption proceeds, the authority said.

Recent sanctions were placed on the country’s vice president and one of his associates for trying to launder money and assets connected with a narcotics trafficking business.

The Treasury Department’s Office of Foreign Assets Control (OFAC) designated Venezuelan Vice President Tareck El Aissami to the Foreign Narcotics Kingpin Designation Act.

OFAC also designated his front man, Samark Lopez Bello, for materially assisting El Aissami and acting on his behalf. Their designation disrupted their ability to launder illicit proceeds and hundreds of millions in assets have since been blocked.

GamblingCompliance: IRS Criminal Chief Expresses ‘Keen Interest’ In Gaming Industry


The head of the Internal Revenue Service Criminal Investigation unit recently warned casino executives that the gaming industry is one of the very few that the agency has a “keen interest in at all levels,” and that law enforcement could be watching them.

“So, I would encourage you to make sure that the business side of your casino takes AML controls just as seriously as its other threats,” Don Fort, the recently appointed chief of criminal investigations with the IRS, said in remarks prepared for an AML conference in Las Vegas.

Fort admitted there were a “variety of customers and (a) breadth of transactions” in the gaming business.

Fort said many of those customers are legitimate, hard working people just trying to hit it big in Las Vegas. But others, he said, may be trying to hide and conceal illicit proceeds or violate bank secrecy laws, and even various tax crimes.

All of these potential violations, he said, intersect with our primary jurisdiction that includes tax, money laundering and Bank Secrecy Act (BSA).

“First and foremost … we are a tax agency,” Fort reminded conference attendees last week. “We take this very seriously. What we do in investigating and recommending cases for prosecution to the (U.S.) Department of Justice is crucial.”

Fort cautioned attendees that it is extremely important for the casino industry to understand and embrace a risk-based approach to anti-money laundering compliance.

“Casinos are not strangers to the concept of risk,” he said. “You calculate the risk of losing money as part of your business operations every day. You safeguard yourselves from cheating and theft.”

“I would encourage you to make sure that the business side of your casino takes AML controls just as seriously as its other threats,” Fort said.

Fort was the keynote speaker on August 16 at the 2017 National Title 31 Suspicious Activity & Risk Assessment Conference and Expo held at the Cosmopolitan of Las Vegas.

Casinos and card clubs have been required to comply with reporting requirements of the BSA for many years and since 2001 have been obligated to implement formal AML policies.

But recent years have seen a notable increase in federal enforcement activity for AML lapses, with at least seven actions brought against licensed gaming operators since the beginning of 2015.

Fort educated conference attendees as to how his investigators build a criminal case against a casino.

He said the IRS uses special investigative techniques and data analytics tools to look for evidence that demonstrates willful actions to avoid regulatory requirements.

In a typical case, evidence may include communications between employees and senior leaders and with patrons that are well-know to the property.

Fort’s also suggested a simple step to avoid a criminal case: casino employees should be made to understand that “law enforcement could be watching.”

So what can casinos do to better protect themselves from enforcement risks?

Fort said it starts with providing a thorough, detailed narrative in suspicious activity reports (SARs) to assist the IRS and other federal agencies, including the Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Department of Treasury.

Then casinos must implement reasonably designed procedures for “using all available information to determine … the occurrence of any transactions or patterns of transactions required to be reported as suspicious.”

According to federal regulations, a compliant risk-based program should pay attention to five specific factors: customers’ source of funds; customer due diligence; international money transfers; pass through activity; and third-party transactions.

“But the most important of all is to create a culture of AML compliance,” Fort said. “Violating BSA can result in FinCEN imposing civil penalties against the casino itself, as well as its employees, partners, officer and directors. It can also result in … criminal penalties.”

He added that from the IRS Criminal Investigation’s (IRS CI) perspective, SARs and the information contained within them is incredibly valuable, bringing to light behaviour and activities that in many cases are the only indication of other criminal activity.

The IRS CI downloads about a million SARs each year, he said. The total nuimber of SARs filed by casinos and card clubs has increased from 49,558 in 2015 to 57,210 last year.

So far in fiscal year 2017, the IRS has successfully prosecuted one case involving illegal gambling.

In October, David Stewart of Orlando, Florida, was sentenced to 41 months in prison for wire and bank fraud in connection with an illegal online gambling business.

The IRS said Stewart got financial institutions to process internet gambling payments by disguising the transactions as payments for online television and movie subscriptions from DiamondPayTV, a phony online merchant.

Stewart then funneled the illegal gambling proceeds through business bank accounts that he opened in the names of shell companies and transferred the funds to overseas accounts controlled by the internet casinos, according to the IRS.

During a one-year period, Stewart and others involved processed over 59,000 credit card transactions for illegal internet gambling, totaling about $4.2m.

Since October 2014, none of the illegal gambling convictions won by the IRS involve commercial or tribal casinos. The 12 cases involve people being sentenced for not paying taxes on proceeds from illegal gambling operations, video poker, bookmaking or online gambling.

Despite its unique focus, Fort said IRS CI plays a “critical role” in cyber crimes cases and terrorism cases; not by going after the hacker or terrorist, but going after the money.

The challenge today is having more responsibility with the same number of agents — 2,200 — that the IRS had “about 40 to 50 years ago,” Fort said.

“Financial crime has not diminished, in fact, it has proliferated in the age of the internet and virtual currency.”

GamblingCompliance: U.S. Supreme Court Case A Predicament For Sports Leagues


If the U.S. Supreme Court rules New Jersey can offer legal sports betting, the four major U.S. professional sports leagues may not be pleased with the outcome but they are likely to be prepared for that outcome, a panel of experts said Tuesday.

David Purdum, a gambling reporter with ESPN, said if the leagues were to lose their case, they “would relinquish all control of sports betting.”

Currently, the leagues have control by being able to go to court to block any proposed expansion of sports betting in the U.S. That is lost if the Supreme Court overturns the federal ban on wagering on sports.

Purdum said the best-case scenario for the leagues would be a “direct and significant revenue stream” from legal sports betting in the U.S. The catch, Purdum said, is the leagues will want to avoid the appearance of making that direct connection to gambling.

The Supreme Court is expected to hear New Jersey’s challenge to the scope of the Professional and Amateur Sports Protection Act (PASPA) by late fall or early winter.

Purdum added that he did not think a loss would be the worst case scenario for professional sports leagues. He believes they are worried about a patch work, or state-by-state, system of regulations with no revenues for the leagues.

“It still comes back to they want to make money,” Purdum said.

Andrew Brandt, director of the Jeffrey S. Moorad Center for the Study of Sports Law at Villanova University, said on the legal front, the Supreme Court taking this case is a big deal.

The court decided to take up the case despite the U.S. solicitor general’s opposition and the Supreme Court’s denial in 2014 to consider an earlier version of this case.

Brandt said “evolving” was the word he kept hearing when it came to the position of the four major professional sports leagues — the National Football League (NFL), the National Hockey League (NHL), Major League Baseball (MLB) and the National Basketball Association (NBA) — on sports betting.

“We are only three years from [former Dallas Cowboys quarterback] Tony Romo being told he couldn’t attend a fantasy sports conference in Las Vegas,” Brandt said. “Not because it was Vegas, but because it was held in a casino.”

“We are at a different point today,” Brandt said.

Both Brandt and Purdum participated Tuesday in a webinar presented by Clarion Gaming on preparing for the Supreme Court’s New Jersey decision and options for the sports industry.

Moderator Daniel Wallach, a gaming attorney with Becker & Poliakoff in Fort Lauderdale, Florida, asked if Nevada should be concerned that the court could decide not only to maintain a wagering ban on New Jersey but also extend the betting prohibition to the Silver State.

Wallach called it the “doomsday scenario,” where the court kills an industry.

He cited an article by Ryan Rodenberg, who teaches at Florida State University and is considered an expert on PASPA, that said the Supreme Court might simply eliminate the exemptions from PASPA instead of overturning the federal ban.

Under PASPA, which Congress passed in 1992, Nevada is completely exempt from the federal sports-betting ban and Delaware, Montana and Oregon are partially exempt.

Beyond those four states, evidence from Congress indicates Arizona, New Mexico, North Dakota, South Dakota and Wyoming also are exempt from PASPA in varying degrees, according to Rodenberg’s article in the Duke Law Review.

Purdum acknowledged the doomsday scenario as a possibility, but from a practical standpoint it is unlikely that the justices would decide to take away an industry that generated $4.5bn in bets last year.

“There will be some type of compromise and a ruling will come down the middle,” Purdum said.

Until there is a decision, the four major professional sports leagues have been reluctant to comment on the Supreme Court’s decision to take the case.

But the commissioners of the NBA and MLB, along with Major League Soccer (MLS), have said they need to be in a position to try to shape what a future regulatory scheme for sports betting might look like, even as both the NBA and MLB continue to oppose New Jersey’s efforts in court.

“There will be some point when they can’t straddle the issue anymore,” Brandt said.

Brandt expects the NFL to reach that point in about three years, when the Raiders complete their move from Oakland to Las Vegas.

“I think the NFL understands their predicament,” Brandt said. “Commissioner Roger Goodell praises Nevada’s gaming regulations, while fighting those exact same regulations New Jersey has proposed.”

Brandt, a former vice president with the NFL’s Green Bay Packers, said people associated with the NFL he has spoke to about the Raiders move to Las Vegas were concerned about whether the market was large enough to support a team or whether it is just a tourist market.

They also expressed their concern if there was long-term support for the team, he said.

All those issues, Brandt said, were more important than gambling and casinos, which “to me was an astounding response.”

Gary Bettman, commissioner of the NHL, which includes a new franchise in Las Vegas, recently told reporters: “We’re a small part of betting compared to football and basketball … I don’t worry about fixing games.”

Purdum reminded opponents of legalized sports betting that whether legal or not there are going to be scandals in the future.

“It’s time to move past that and have something more pragmatic,” Purdum said.

GamblingCompliance: Fitch Sees Flat Regional Gaming Markets But Bright Future For Las Vegas


Regional casino revenues in the U.S. are expected to be no better than “flattish to slightly positive” this year, with the forthcoming Hard Rock casino in Atlantic City a threat to incumbent operators there, according to a report published by Fitch Ratings.

The ratings agency attributes its cautious outlook for some regional markets to pockets of weak consumer confidence, particularly in parts of the country reliant on the energy sector.

Revenues from casino markets outside Las Vegas were up 2 percent through the end of May, with June up on the prior year as well, Colin Mansfield, director of corporate ratings gaming, lodging and leisure, wrote in a report following meetings with gaming companies and manufacturers.

“The consumer continues to feel healthy, except in petrochemical-dependent pockets of the southeast,” Mansfield wrote, referring to Louisiana and parts of Mississippi in particular. “Northeast and western markets continue to fare better than the more mature Midwest and some southeast markets with more struggling economies.”

Mansfield told GamblingCompliance that Midwestern markets such as Indiana, Missouri and Iowa are likely to see flat revenues this year as they generally have “a relatively stable supply but not a great deal of positive economic catalysts.”

“Conversely, some pockets of slightly positive growth will likely be seen in Ohio and Massachusetts as casino openings from the past few years continue to ramp up, and markets with stronger underlying fundamentals (Florida, Las Vegas Locals),” Mansfield said.

In New Jersey, Mansfield said that most of the casino operators Fitch recently met with “believe the addition of Hard Rock to Atlantic City will negatively impact the market.”

Hard Rock International, which is owned by the Seminole Tribe of Florida, has begun a $500m renovation of the shuttered Trump Taj Mahal, which it acquired for just $50m.

Hard Rock boss Jim Allen has been bullish about the future of the Trump Taj Mahal and Atlantic City, telling attendees recently at the East Coast Gaming Congress at Harrah’s Atlantic City that the “challenging days are behind us.”

That may be so. Through the end of June, year-to-date gaming revenues in New Jersey were up 3.5 percent. However, a 28 percent increase in internet gaming accounts for a significant chunk of that and land-based gaming revenue at Atlantic City casinos was up only 1.5 percent, according to the New Jersey Division of Gaming Enforcement.

New Jersey currently has seven casinos in Atlantic City, with the Atlantic Club, Showboat, Revel, Trump Plaza and Trump Taj Mahal casinos all closing between January 2014 and October last year.

Mansfield on Thursday reiterated his concern that the addition of Hard Rock “will negatively impact some of the current operators.”

“Atlantic City has stabilized around a $2.4bn per year market and the current operating environment (with seven properties) has been healthier,” Mansfield told GamblingCompliance. “It’s allowed the remaining operators to increase their profitability relative to a few years ago when there were as many as 12 properties.”

As for Las Vegas, Mansfield noted that the development of non-gaming offerings continues to “be in favor given the strength of visitation and convention business in the face of stagnant room supply.”

The next injection of new supply on the Las Vegas Strip is expected to come when Malaysia’s Genting Group opens the $4bn, 3,000-room Resorts World Las Vegas project.

The Malaysia-based Genting bought the property in 2013 from Boyd Gaming for $350m. Boyd had started building a resort on the site of the former Stardust casino when the recession struck, leaving just a steel-and-concrete skeleton standing on the property.

In a note to clients, Mansfield and fellow Fitch analyst Alex Bumazhny said the Resorts World property “has not changed much since our last visit in October.”

Meanwhile, the stalled Alon casino project appears to continue to be up for sale, the analysts noted.

By the time Resorts World opens, Las Vegas will have hosted its first NFL game after owners approved the relocation of the Oakland Raiders to southern Nevada in time for the 2019 season.

“All [casino] operators feel the new NFL franchise is positive for the long-term health of Las Vegas and will help boost visitation around the eight home games,” Mansfield said, citing meetings with nine gaming companies including Las Vegas Sands, Wynn Resorts, MGM Resorts International, and Caesars Entertainment.