They say that if you notice the umpire or referee at a sporting event doing his job, he’s not doing it very well. That’s almost comparable to the gaming regulator. Except that if you notice the regulator doing his job, you are usually doing your job wrong.
Regulators are the umpires and referees of gaming. They usually go about their business and you don’t notice them because you are abiding by all the rules and regulations set down in the statute. You rarely hear a peep out of the regulators unless something is going wrong.
The one exception to that rule occurs every March in Las Vegas at the GLI Regulators Roundtable. And this year was no different. They get together to discuss the issues facing regulators and how they each approach them.
There is no blueprint for regulators. A system in one state is usually only good for that one state. New jurisdictions setting up regulations are wise to examine many regulatory models and pick and choose options that fit their particular situation.
Regulators are critical to the success of the gaming industry. For the business to thrive, regulators must be on the job and be diligent. They safeguard the integrity of the games and the gaming operation. They ensure that players get a fair shake and that investors can entrust their money to gaming companies in good faith.
Of course, the genesis of the gaming industry-at least in the United States-was with organized crime. That’s one reason regulators are so important. The cleansing of the gaming industry took several decades, and was only fully accomplished after gaming expanded outside Nevada to other states where there was zero tolerance for organized crime involvement. But the perception remains in all gaming jurisdictions, so regulators remain the first line of defense in battling this old saw.
But today, as demonstrated at the GLI Roundtable, many challenges remain. The international expansion of the gaming industry makes licensing that much more difficult. New Jersey’s rejection (as opposed to the approval of Nevada and Mississippi) of the partnership of Pansy Ho and MGM Mirage is one case in point. While regulations and procedures are different from state to state, should each jurisdiction hold its licensees to disparate standards? Is there a different definition of “integrity” in different jurisdictions?
Another challenge is the rapidly changing financial structure of the gaming industry. From the entry of private-equity companies as owners to the takeover of casinos in default by lending institutions, these are situations that often were not envisioned by the framers of any state regulations. Institutions that never considered being actual owners of casinos are now being forced to take over to avoid losing their entire investment. How do regulators handle the licensing requirements?
And then there is rapidly developing technology and its impact on gaming. At the GLI conference, there were sessions describing hybrid games, facsimile machines, technological aids, server-based gaming and even internet gaming in a few states considering the online betting systems. For cash-strapped states, gaming regulatory agencies are usually not at the top of the priority list when it comes to precious dollars. So regulators must do more with less.
But of course, just as the financial support of the state declines, the problems increase. For tribal gaming operations, the constant battle with the National Indian Gaming Commission is on hold while new commissioners take over. Acting Chairman George Skibine has only a couple months left on his “acting” title, and we’ve already got two new commissioners.
In Pennsylvania, the industry is booming while the unilateral approach of the gaming commission continues to be criticized. New Jersey is under pressure to reduce the size of its two agencies as gaming revenues continue to freefall. The same is true in Nevada.
A new Casino Control Board in Singapore has drawn a bright line in the regulations on what is acceptable and what is not. Some Asian nations are struggling just to keep up with gaming regulations as the industry booms.
And in Bulgaria, a regulator claims one casino chain has “thousands” of violations. We’re left to wonder whether it’s more surprising that those violations exist or that a regulator used a public forum to call attention to it.
Yes, regulation is a thankless job in most cases. It’s kind of like the umpire in baseball who can make thousands of calls and no one notices, but one questionable call and everyone yells “kill the ump!”
You just can’t win.
