Compliance Updates
UKGC: Systemic failings at Caesars Entertainment UK leads to the departure of three senior managers and sanctions of £13m
The UK Gambling Commission has announced that Caesars Entertainment UK Limited is to pay £13m and must implement a series of improvements following a catalogue of social responsibility, money laundering and customer interaction failures including those involving ‘VIPs’.
As a result of this investigation three senior managers at the company surrendered their personal licences.
The Regulator’s investigations into Personal Management Licence holders are ongoing.
The land-based gambling business, which operates 11 casinos across Britain, will pay the money following an investigation by the Commission which found serious systematic failings in the way the company took decisions about VIP customers between January 2016 and December 2018.
Social responsibility failings included:
- Inadequate interaction with a customer who was known to have previously self-excluded and lost £240,000 over a 13-month period
- Inadequate interaction with a customer who lost £323,000 in a 12-month period and had displayed signs of problem gambling which included 30 sessions exceeding five hours
- A customer allowed to lose £18,000 in a year despite identifying herself as a self-employed nanny and informing staff that her savings had been spent, and that she was borrowing money from family and using an overdraft facility to fund gambling activities
- Inadequate interaction with, and source of funds checks on, a customer who identified as a retired postman and lost £15,000 in 44 days.
Money laundering failings included:
- The operator not carrying out adequate source of funds checks on a customer who was allowed to drop around £3.5 million and lose £1.6 million over a period of three months.
- The operator not obtaining adequate evidence of source of funds for a politically exposed person (PEP) who lost £795,000 during a 13-month period
- The operator not carrying out enhanced customer due diligence (ECDD) checks on a consumer who lost £240,000 over a 13-month period
- The operator not carrying out adequate source of funds checks on a customer who identified as a waitress and was allowed to buy-in £87,000 and lose £15,000 during a 12-month period.
Neil McArthur, Chief Executive of the Gambling Commission, said: “We have published this case at this time because it’s vitally important that the lessons are factored into the work the industry is currently doing to address poor practices of VIP management in which we must see rapid progress made.
“The failings in this case are extremely serious. A culture of putting customer safety at the heart of business decisions should be set from the very top of every company and Caesars failed to do this. We will now continue to investigate the individual licence holders involved with the decisions taken in this case.
“In recent times the online sector has received the greatest scrutiny around VIP practices but VIP practices are found right across the industry and our tough approach to compliance and enforcement will continue, whether a business is on the high street or online.
“We are absolutely clear about our expectations of operators – whatever type of gambling they offer they must know their customers. They must interact with them and check what they can afford to gamble with – stepping in when they see signs of harm. Consumer safety is non-negotiable.”
All £13m from this case will be directed towards delivering the National Strategy to Reduce Gambling Harms.
The action against Caesars is the latest in a line of tough regulatory action by the Commission.
Since January the Commission has suspended the operating licences of Stakers Limited, Addison Global Limited, and Multi Media International Limited.
So far this year regulatory action has led to the industry paying £27 million in penalty packages. This includes £11.6 million for Betway and £3 million for Mr Green.
Read public statement about Caesars Entertainment here.
Source: UKGC
Amidst an evolving economic landscape, gaming executives report a positive outlook on future industry business conditions while remaining satisfied with the current business environment, according to the American Gaming Association’s (AGA) Gaming Industry Outlook.
Nearly all gaming executives surveyed characterized the current business environment as good (44%) or satisfactory (50%), mirroring similar sentiment from Q3 2023. Meanwhile, executives are more optimistic about future conditions, with 32 percent of CEOs expecting business conditions to improve over the next six months, up from 20 percent in Q3 2023.
“Gaming’s record-setting growth over the last three years has set a new standard for industry success,” said AGA President and CEO Bill Miller. “However, as we enter a period of market normalization, continued investment and innovation in offering world-class, responsible entertainment experiences will be required to maintain industry momentum.”
Gaming Executive Panel
Gaming executives have become more positive in their views that overall balance sheet health will improve over the next 6 months (42% net positive), but they expect the pace of revenue growth (13% net negative) and new hiring (22% net negative) to slow. These expectations for decelerating growth have influenced expectations for increases in capital investment and gaming units in operation, with smaller net positive sentiments than before.
- In contrast to past Outlooks, gaming equipment suppliers are slightly pessimistic about the sale of gaming units for replacement use and new or expansion use (both 13% net negative). However, they remain optimistic about the pace of capital investment (38% net positive).
- Half of operator CEOs expect capital investments in hotels over the next year to be higher than normal, and compared to last fall, more also expect higher than normal levels of capital investment in meetings and conventions and table games (28%). Meanwhile, 44 percent of CEOs expect increases in food and beverage investment, down from 67 percent in Q3 2023.
These expectations are also informed by evolving macroeconomic challenges. Executives report that inflationary or interest rate concerns continue to be a major factor limiting operations (28%), but these have been overtaken by geo-political risk (34%) and uncertainty of the economic environment (34%) as the biggest limiting factors in the most recent Gaming Executive Panel.
Current Conditions Index
The Current Conditions Index of 102.8 for Q1 indicates solid annualized real economic growth in the industry of 2.8%. This includes gaming revenue, employment and employee wages and salaries. Notably, the Current Conditions Index shows gaming expanding faster than the overall U.S. economy which last week reported 1.6 percent GDP growth in Q1 2024.
Future Conditions Index
The Future Conditions Index stands at 102.2, indicating annualized industry economic activity, after controlling for underlying inflation, is expected to moderately increase over the next six months. This outlook reflects Oxford Economics’ forecast that the U.S. economy will slow during 2024 but avoid recession. Despite a projected economic slowdown, consumer survey results continue to indicate that more than one-third of adults expect to visit a casino during the next 12 months, consistent with prior quarter results.
About the Outlook
The AGA Gaming Industry Outlook is prepared biannually by Oxford Economics. It provides a timely measure of recent industry growth and future expectations. The Q1 2024 survey was conducted between March 28 – April 10, 2024. A total of 32 executives responded, including executives at the major international and domestic gaming companies, tribal gaming operators, single-unit casino operators, major gaming equipment suppliers, and major iGaming and/or sports betting operators.
PHOENIX – Bettors in Arizona wagered approximately $637.5 million on sports in February of 2024, according to a new report by the Arizona Department of Gaming. This represents an approximate 4.6% increase when compared to February of 2023.
The state collected approximately $2.8 million in privilege fees in the month. You can view the full February report on the ADG website: LINK.
North Carolina legislator intends to introduce legislation to ban college player prop bets, according to a staff member.
North Carolina State Representative Marcia Morey, D-Durham, a former Olympic swimmer, will submit a bill by the bill filing deadline on Thursday to ban these bets, Hannah Smith, Administrative Assistant, told Gambling.com on Monday.
The North Carolina Legislature began meeting in Raleigh on April 24 with the session set to end on July 31.
Recently, NCAA President Charlie Baker, a former Massachusetts governor, called upon states to ban college player prop bets, which is short for proposition bets. Baker said these bets, based on an athlete’s individual performance such as the over/under on the number of rebounds the player might record, could undermine the integrity of games and lead to harassment of players.
Former North Carolina Tar Heel star Armando Bacot is among athletes who have expressed concern about harassment. Bacot said he heard from fans angry that he didn’t get enough rebounds in an NCAA tournament game against Michigan State – a game the Tar Heels won.
College Prop Bets Allowed in Some States
Some states already ban these bets, while others including Louisiana, intend to impose a ban this summer before the college and pro football seasons begin.
In other states, the proposed ban has met with resistance.
During a recent interview on The Edge, Arkansas casino executive Carlton Saffa told Gambling.com a ban would drive bettors to unregulated offshore sportsbooks or illegal bookies. He said a better solution is to keep those bets legal in regulated markets where irregularities can be spotted.
“Sunshine is the best disinfectant,” Saffa, the Chief Marketing Officer for the Saracen Casino Resort in Pine Bluff, Arkansas, said.
College player prop bets remain legal in Arkansas.
In North Carolina, where statewide mobile sports betting became legal in March, State Representative Jason Saine, R-Lincoln, said in a story on the WNCN-TV website that a college player prop ban is ‘a solution in search of a problem’. If athletes are being harassed, he said, campus police should crack down on those making the threats and make an example of them. A ban won’t stop the problem, Saine said.
“If we ended (player prop bets) tomorrow, this kind of behavior would still continue with fanatical people,” Saine said. “Follow rules of society, you don’t threaten anybody, or you shouldn’t be. And, that’s kind of my take on it. I don’t think we need a whole new set of rules to pursue something like that.”
Morey, the lawmaker proposing the ban, said people are ‘forgetting about the individuals who are actually playing the game and having the pressure on them’.
“Let’s give them a break,” she said.
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