U.S. Regulators Issue Warnings Over Casino Cashier Cage Scams

July 18, 2023
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The National Indian Gaming Commission has issued a formal warning to tribal gaming operators and regulators over a series of imposter scams involving individuals claiming to be senior executives, or state or tribal regulatory officials.

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The National Indian Gaming Commission (NIGC) has issued a formal warning to tribal gaming operators and regulators over a series of imposter scams involving individuals claiming to be state or tribal regulatory officials.

The notice was released about a week after the Nevada Gaming Control Board (NGCB) issued a similar warning notifying licensees of a scam targeting casino cage employees in Nevada and across the country.

The control board issued the notice after Circa Hotel & Casino in downtown Las Vegas was scammed out of $1.7m last month by an imposter convinced an employee to deliver bags of cash to two men at four separate locations on behalf of the casino’s owners.

Erik Gutierrez-Martinez, 23, has been charged with theft in that incident. He was also charged with theft of more than $100,000 in connection with defrauding the Eureka Casino in Mesquite, some 81 miles north of Las Vegas, out of $250,000.

In Nevada, regulators warned casino managers that criminal subjects use social engineering tactics to pose as casino executives.

“The imposters often pose as high-level executives and will contact a cage employee via a PBX (Private Branch Exchange) call. The initial call is frequently followed up with a text message to the employee’s mobile phone, purportedly sent by a second manager to confirm the fraudulent instructions,” the NGCB warned.

The NGCB expressed concern that the cage scam was sophisticated and has been surprisingly effective in defrauding casinos.

Michael Lawton, NGCB’s senior economic analyst, said Monday (July 17) that he was not aware of any additional attempts to defraud Nevada casinos since the notice was issued on July 7.

Other state regulators beyond Nevada are also monitoring the situation, however.

“Our Bureaus of Investigations & Enforcement and Compliance are aware of that situation, but no similar cases have been brought to the board’s attention and no notice has been sent to Pennsylvania casino operators,” Doug Harbach, spokesman with the Pennsylvania Gaming Control Board, said in an email.

Allison Inserro, a spokeswoman for the New Jersey attorney general’s office, said the state's Division of Gaming Enforcement (DGE) is not aware of the presence of scams in New Jersey like those being reported in Nevada.

“Regulations and internal controls required in New Jersey are designed to protect against such scams,” Inserro said. “DGE will provide notice, however, to New Jersey licensees to make them aware of the Nevada Gaming Control Board action for situational awareness.”

The Ohio Casino Control Commission (OCCC) confirmed Monday it has not issued similar guidance at this time.

“There would need to be a near-complete lack of adherence to internal controls by casino personnel (at multiple levels) for this type of scenario to occur,” Jessica Franks, a spokeswoman with the OCCC, said in an email.

A similar incident occurred in Colorado, when a Monarch Casino “cage cashier” received phone and text messages from men claiming to be casinos bosses. They instructed the employee to take money needed by the casino to pay a lawyer, according to media reports.

The incident cost the Monarch $500,000.

The NIGC said it is urging tribes to report any suspicious calls immediately to tribal or local law enforcement, the local FBI office, and the U.S. Secret Service.

“These agencies can detect patterns of fraud from the information collected and share it with other law enforcement agencies,” the NIGC said in its three-page notice.

The notice went on to say that the “NIGC urges tribal officials to ensure that persons working in the tribal gaming operations, such as cage, vault or accounting staff, who have direct access to cash assets or bank accounts are made aware of the scam and know what to do in the event of such a call or other communication.”

“Recently, multiple incidents of scams at commercial and tribal gaming operations have led to losses in the hundreds of thousands of dollars,” the NIGC said in the notice. “The NIGC has been made aware of several failed attempts as well.”

The NIGC did not identify any tribal casino properties where the failed attempts took place.

E. Sequoyah Simermeyer, chair of the NIGC, did not directly address the issue during a presentation Thursday (July 13) on the future of tribal gaming at the National Counsel of Legislators from Gaming States (NCLGS) summer meeting in Denver.

“We are committed to working with all jurisdictions that are involved in gaming regulation,” Simermeyer said.

The NIGC gave a recent example in its notice of a reported scam.

The agency said that someone impersonating a tribal official called an unidentified employee working in the casino vault, stating that a payment must be made immediately to ensure that a vital shipment of equipment is delivered.

The employee was told to remove $100,000 or more in some instances from the vault and use their personal mobile phone to remain on the line, while being directed to drive to Bitcoin deposit kiosks, and then instructed to send the QR code scanned at the Bitcoin deposit kiosks.

During these calls, the NIGC warned that scammers attempt to collect a cash payment or facilitate a cash deposit under the pretense of a false “emergency,” such as a past due payment, or other pressing event, that, if not immediately addressed, will result in “dire” consequences to the operation, the tribe, or the other party.

The transfer of the cash may take the form of a hand-delivery to an individual with whom the victim is directed to meet, usually off-site, by depositing the cash into Bitcoin deposit kiosks, or by a wire transfer of funds from one bank account to another.

The notice reminded tribal operators that the perpetrators use social engineering to learn about the casino and its operators, will create a sense of urgency trying to get cage, vault or accounting staff to make a quick decision, and then use intimidation and fear.

“Scammers may blame you for a past alleged error and try to convince you that this is a way to correct the alleged error without anyone finding out,” the NIGC said. “The call may come after normal business hours, when most officials or top managers have already left for the day or there is a reduced number of gaming operations staff with whom the victim can confer.”

In addition, the NIGC notice urged tribal operators to train staff with access to cash and financial accounts to be aware of these and other similar scams and remind staff to follow the approved internal controls for movement of cash, transfer of funds, or payment of outstanding invoices.

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