Nevada gaming regulators approve changes covering cashless gaming and digital payments

June 26, 2020 11:05 AM
  • Howard Stutz, CDC Gaming Reports
June 26, 2020 11:05 AM
  • Howard Stutz, CDC Gaming Reports

Nevada moved a step closer Thursday to launching cashless gaming systems and digital payment technology inside a rapidly changing casino industry that is now exploring different money-handling solutions.

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In a unanimous vote, the Nevada Gaming Commission approved changes to two regulations covering the electronic transfer of money to games or gaming devices.

The cashless systems, some of which are in use in tribal casinos and other markets, are still subject to additional requirements under the Gaming Control Board’s technical standards.

Acting Gaming Commission Chairman John Moran Jr. said the changes in the regulations “were a good idea” and could enhance the gaming experience at a time when the state’s gaming industry is operating under COVID-19 health, safety, and enhanced cleaning guidelines.

The changes cover two regulations concerning the electronic transfers of money to games or gaming devices. Current regulations do allow customers to transfer money from a debit card to a game or gaming device, but very few properties have licensed systems in place.

Other changes include a daily monetary transfer limit and messages regarding responsible gambling “conspicuously displayed” on devices that include the website of the Nevada Council on Problem Gambling.

“Removing the prohibition of a cashless wagering system, and approving those systems, is opening the door for new gaming technology,” said Gaming Commission Member Deborah Fuetsch.

In support of the regulatory changes, Moran cited comments made in a letter to the commission by a lawyer for the Association of Gaming Equipment Manufacturers.

AGEM attorney Dan Reaser said a cashless environment in Nevada would have “profoundly positive” impacts.

“These outcomes range from enhanced legal compliance, improved public health and safety, especially given the COVID-19 pandemic, as well as more robust responsible gaming alternatives and advanced operating efficiencies,” Reaser wrote.

Gaming Control Board Chairwoman Sandra Douglass Morgan told the commissioners that workshops could be conducted with gaming equipment developers to respond to other changes sought in the regulations.

The American Gaming Association believes the time is now for cashless gaming. Last week, the Washington, D.C.-based trade organization announced a framework for allowing digital payments on casino floors, citing a study that found a majority of casino customers want the option to use cashless or digital technology for gaming.

Though the COVID-19 pandemic spurred a renewed interest in cashless gaming, the AGA has been leading an 18-month collaborative industry-wide effort to come up with a structure that covers eight principles for modernizing casino payments nationwide.

“I applaud today’s decision by the (Nevada) Gaming Commission to introduce added regulatory flexibility for digital payment options on casino floors,” AGA CEO Bill Miller said on Twitter. “This important step supports innovation while bolstering existing responsible gaming, financial tracking, and public health measures.”

One of the issues raised by commissioners involved the use of prepaid debit cards and whether or not they could be used to fund gaming activity. Control Board member Phil Katsaros said such cards were considered a debit instrument under the regulations.

Some years ago, Nevada outlawed credit cards from being used directly on a slot machine.

In addition to AGEM, the regulatory changes were supported by responsible gaming advocates, who said many cashless payment technologies are being developed with player protection features.

“There are clear and obvious benefits associated with cashless payment systems, the most important of which are enhanced spend tracking and record-keeping as well as enhanced (Know Your Customer) and (anti-money laundering) benefits. There are also critically important benefits from a responsible gaming perspective,” Alan Feldman, Distinguished Fellow for Responsible Gaming at UNLV’s International Gaming Institute, wrote in a letter to the Gaming Commission.

Jennifer Carleton, an attorney for Las Vegas-based Sightline Payments, told gaming regulators in a letter that Sightline, a digital payment solutions company, believes customer identity needs to be established prior to wagering activity as one of the best practices to prevent money laundering or problem gambling.

Sightlines doesn’t support “amendments to Nevada gaming regulations that would allow for patrons to anonymously wager with cash directly at a gaming device or table game,” Carleton wrote.

The only opposition to the regulations came from United Auto Workers Local 3555, which represents some 3,000 dealers, slots, cage, and count team workers in Nevada casinos. The union was opposed to the changes for four reasons – responsible gaming issues, the potential for such systems to be compromised by fraud or hackers, potential job loss by casino workers, and a possible reduction in casino workers’ tip income.

Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at Follow @howardstutz on Twitter.