Penn Boss Says AI Offers Risks, Opportunities For U.S. Gaming Industry

April 25, 2024
The chief executive of Penn Entertainment believes artificial intelligence offers opportunities for the regulated gaming industry, but warned its use by cybercriminals is also a direct threat to businesses.

The chief executive of Penn Entertainment believes artificial intelligence (AI) offers opportunities for the regulated gaming industry, but warned its use by cybercriminals is also a direct threat to businesses.

 Speaking last week at the East Coast Gaming Congress at Hard Rock casino in Atlantic City, Penn CEO Jay Snowden described AI as “something that’s a little bit provocative, a little bit fun, [and] a little bit holy [s**t].”

Snowden began a presentation on AI in the gaming industry by sharing the audio of a voicemail message received by a company executive that utilized “vishing,” which is short for voice phishing, an AI technology that can replicate someone’s voice.

Snowden explained that Penn recently had a fake voicemail left for one of the senior executives in its treasury department. “Someone I have a good relationship with and who knows me well and knows my voice well and knows how I talk and the type of things I might ask for.”

Although the number was unrecognized, the audio sounded almost exactly like Snowden’s voice and asked the executive to assist with recent litigation.

“Hello Jennifer, this is Jay Snowden. Listen, could you please take care of things for me immediately? I need you to take care of an urgent compensation … for an employee that was injured at our company,” Snowden’s manufactured voice said in the message.

“After two years of litigation, a court ruled that our company is responsible for the loss of ability to work with our former colleague. Felicia Hendrix (Penn’s CFO) was notified already, and he provided me with your phone number. Let me know that you got this message and I’ll send the details to you. Please keep this confidential. I do not want the company’s reputation to be harmed by the news.”

Snowden expressed surprise at how similar the voice on the message was to his own but pointed out a couple of errors that indicated it was a scam.

“The message referenced Felicia Hendrix, who is our CFO, and said he,” Snowden said. “He gave me your number. So, there are little things in there but if you are a manager or director within the organization and you get that voicemail from the CEO, what do you think is going to happen nine times out of ten?”

It’s “really, really scary,” Snowden added.

Vishing scammers can harvest samples of people’s voices from social media, video clips or investor calls and then clone their voices using generative AI. The social engineering scheme is conducted by phone call or voicemail.

It often uses voice over internet protocol (VoIP) to get around caller ID or war dialing to deliver thousands of automated voice messages. Other known attacks are phishing emails and the use of text messaging to gain access to a company’s internal systems.

“We get it all the time, text messages,” Snowden said. “They try to start a dialogue with you. Once you start the dialogue it turns into give me a ring and I need to wire money. So phishing strategies are getting more and more sophisticated.”

A vishing attack conducted by hacker group Scattered Spider shut down MGM Resorts International properties in Las Vegas and eight states in September for more than a week.

MGM CEO Bill Hornbuckle last year described the cyberattack as “corporate terrorism at its finest”.

The attack knocked out the telephones, casino systems, hotel systems and other company functions. Ultimately, the AI-generated phone call cost MGM $100m, which Hornbuckle said was covered by cyber insurance.

Caesars Entertainment also fell victim to a cyberattack last year, but its casino computer operations were not disrupted after the casino operator agreed to pay a $15m ransom.

Snowden noted that the next iteration of AI technology will likely add video to these messages, with images using his voice, pauses, expressions and knowledge of Penn’s executive teams to potentially ask for a wire payment to be confidentially made for $400,000 to a law firm.

“This is a big deal, and there are a lot of risks associated with it,” Snowden warned.

Despite the risks, Snowden said that AI offers significant new opportunities, especially as a proactive tool to identify behaviors associated with problem gambling, as well as predicting consumer behaviors to provide real-time responses to customer requests, and personalization of casino marketing.

“As it relates to marketing, I think personalization is one of the keywords here,” he said. “All the things you can do when you have information about your customers to stay in front of what they are going to ask for based on their prior behavior, based on trends, based on history.”

Snowden said AI also allows for innovation related to online sports betting and internet gaming, including increasing the accuracy of models that bookmakers use to set lines or expand wagering options.

“This is something that we are all looking for, so you can prevent those sharp bettors from being able to take advantage and you have all your games priced in a way that will prevent any fraudulent activity.”

Snowden said he expected more betting markets to be opened up due to AI and the information it provides because sportsbook operators will be more comfortable offering more events to bet on.

“I don’t see AI replacing the things we do today but just supplementing in many ways,” Snowden said. “The technology is evolving very quickly, but it is not perfect.”  

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