AGA and the Nevada Gaming Control Board need to up their profiles amid sports betting scandal

March 27, 2024 7:08 PM
  • John L. Smith, CDC Gaming Reports
March 27, 2024 7:08 PM
  • John L. Smith, CDC Gaming Reports

Talk about March Madness.

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During one of the busiest times of the year for the skyrocketing legal bookmaking industry and at a time that the once-scorned gambling activity has gained unprecedented acceptance, the betting scandal surrounding Los Angeles Dodgers superstar Shohei Ohtani and his former interpreter is interrupting the Big Dance party.

It’s also putting an increasingly intense spotlight on the Nevada Gaming Control Board and the American Gaming Association, thanks to a scandal that’s now been eclipsed by sports celebrity. It’s the true, and unsurprising, tale of Strip gaming companies allowing illegal bookmakers to gamble on property, despite knowing their profession.

On first blush, the Gaming Control Board would appear to have the most credibility at stake. GCB agents have long been tasked with balancing their duties in the field with the political reality of attempting to regulate an enormous and complex industry traditionally riddled with customers gambling with hard-to-explain income. Do too little and you’re inviting criticism. Press too hard and you’re driving away good customers.

Did the GCB know about Wayne Nix, who appears to have made little secret of his illegal bookmaking enterprise as he recruited new clients from his fellow Las Vegas casino customers? How about Matt Bowyer or some of the other illegal bookmakers who are bound to surface as the federal investigation wears on?

Clear federal laws, including the Bank Secrecy Act (BSA), require casinos to know their customers and act accordingly. Failure to do so cost former MGM Grand President Scott Sibella dearly, after he pled guilty in January to a single violation of the BSA in a case connected with Nix.

That case is just part of an expanding federal investigation being brought out of California by IRS Criminal Investigation and Homeland Security investigations. The twisted tail of California resident Bowyer, a former high roller at Resorts World Las Vegas, continues to play out in the federal investigation of former Ohtani interpreter Ippei Mizuhara. Although Mizuhara is being accused of stealing $4.5 million from Ohtani to pay sports-gambling debts, the investigation is far from finished.

The case emanated from California, but the tar of scandal splashes on Las Vegas, due to Bowyer’s high-roller status. I suspect we’ll be reading his name a lot in the months to come. After all, it only makes sense that he would have a lot more than one client.

As the gaming industry’s lobbying arm and guardian of its image, the AGA just might be faced with the toughest task of all: celebrating the spread of legalized sports betting, while calling for federal-government assistance in rooting out illegal-bookmaking networks when it’s clear that some of your own members have been marketing to the outlaws. Talk about juggling chainsaws.

In recent years, AGA President and CEO Bill Miller has called for federal law enforcement to go after illegal sportsbook and igaming operators. In December 2022, Miller told a group of lawmakers that he believed some illegal operators wanted slip into the legal side of the industry without following the rules. He told the National Council of Legislators of Gaming States, “… An indictment will make it very difficult for someone who lives in that gray area to ever get licensed.”

In a letter to U.S. Attorney General Merrick Garland in April of that year, Miller called for a federal crackdown on illegal sportsbooks and casinos. In doing so, it’s clear he was attempting to protect the legal side and focus on the fact that illegal sports betting alone generated billions annually.

“While the challenge of illegal gambling is not new, the brazen and coordinated manner in which it occurs – both online and in communities – has elevated this problem to a level that requires federal attention,” Miller wrote.

Since then, he’s taken a more public role in stating the importance of policing the illegal end of gaming, whether it’s at the federal or local levels.

Not everyone is applauding the industry’s rhetoric in the face of a harsher reality. This week, former gaming-industry executive Richard Schuetz penned an insightful editorial on the subject that cut through the fog on the casino floor.

It would be refreshing to see current industry leaders show half as much candor as they rush to meet the next quarterly profit goals.

As for Miller, he might be working on a follow-up essay with a working title “Casino regulation begins at home.”