MGM, Wynn Await Sanctions For Illegal Wagers In Massachusetts

April 17, 2023
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Representatives from MGM Resorts International and Wynn Resorts took part in separate hearings on Friday before the Massachusetts Gaming Commission to explain how each company violated state law by accepting illegal wagers on in-state college games.

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Representatives from MGM Resorts International and Wynn Resorts took part in separate hearings on Friday (April 14) before the Massachusetts Gaming Commission (MGC) to explain how each company violated state law by accepting illegal wagers on in-state college games.

Both companies acknowledged the violations at their respective hearings.

The MGM Springfield violations occurred on February 3 when money was wagered on a Harvard men’s college basketball game against Yale, followed on February 4 involving a Harvard men’s basketball game against Brown.

Zachary Mercer, enforcement counsel with the MGC’s Investigations and Enforcement Bureau (IEB), said the company self-reported the violations to the commission on February 10.

Mercer said 28 bets in total were placed at sports wagering kiosks either as part of a parlay or straight bets, with $1,150.50 wagered on Harvard versus Yale, and then $80 on the game against Brown.

Dan Miller, director of compliance with MGM Springfield, said the error occurred because when Harvard was originally added to a blacklist document under a previous jurisdiction’s requirement of no collegiate sports, it was incorrectly designated as being in Connecticut.

“Harvard slipped through because of the incorrect designation,” Miller said. “This has since been corrected and Harvard has properly been categorized as a Massachusetts college.”

Commissioner Bradford Hill questioned why it took a week for MGM to notify the commission.

Miller said MGM Springfield did not know about the mistake until casino executives asked BetMGM to do a review of the blacklist. He said that review took place on February 9 and 10.

Commissioner Eileen O’Brien then asked what prompted MGM to ask for the review, and did they have any concerns that caused them to ask for the check.

“To be frank, at the time, we had heard of the possible errors at Encore (Boston Harbor) and Plainridge (Park Casino) and we felt in due diligence we should go back and check the system … hoping we wouldn’t find anything,” Miller said. “But in doing so, we did and that gave us cause to correct those issues as well.”

On March 14, the five-member commission held two hearings with representatives from Wynn Resorts and Penn Entertainment to discuss self-report violations stemming from accepting illegal college sports wagers.

Massachusetts law expressly prohibits wagering on in-state college games apart from when Massachusetts teams are competing in tournaments with four or more college teams.

On Friday, executives with Encore Boston Harbor and its partner GAN testified that wagering was allowed on Boston College’s February 12 women’s basketball game against the University of North Carolina and its February 19 game against University of Louisville.

Rob Lekites, GAN’s vice president of North American sports betting and sales, said the illegal bets were the result of a glitch in the computerized system that did not identify “Boston College women’s basketball” and “Boston College Eagles women’s basketball” as illegal wagers in Massachusetts.

The commission did not make an immediate decision on penalties or fines related to the violations. MGC chair Cathy Judd-Stein said the commission will issue a written decision at a later date.

Tracks, OTBs Question Spending Requirements

Meanwhile, Massachusetts regulators encountered some opposition as they discussed the state’s spending requirements for sports-betting facilities at horseracing tracks and off-track betting (OTBs) locations.

The state’s sports-betting law requires racetracks and OTBs to make a capital investment of at least $7.5m within three years of being licensed. A Category 2 license allows a racetrack or OTB to open a retail sportsbook and offer mobile wagering via a single skin.

Only Raynham Park and Suffolk Downs are currently eligible to apply for a Category 2 license.

In a four-page letter to the commission, attorney Jed Nosal, who represents Massasoit Greyhound Association (MGA), which owns Raynham Park, urged that the proposed regulation, 205 CMR 222, be withdrawn, believing that several of its provisions lack statutory authority under the Massachusetts Sports Wagering Act.

Nosal wrote that although the MGA is committed to working with the commission pertaining to the accounting of its capital requirements under the statute, the MGA should not be subject to construction oversight and reporting as applied to those of the state’s Category 1 land-based casinos.

Under the proposed regulation, the MGC will approve the project plan for spending on a sportsbook and its related infrastructure, and the plan must include goals for working with minority and women-owned businesses.

Commissioner Nakisha Skinner noted the MGA's general objection to the regulation, but the specific objection by the MGA seemed to focus on the requirements with equal opportunity and diversity, equity and inclusion.

“I’m a little dismayed by that,” Skinner said. “Something that this commission takes very seriously, essentially three pages of why the regulation shouldn’t apply particularly around the diversity component is a little frustrating and concerning to say the least.”

The rule also allows the commission to suspend or revoke a Category 2 license should the company fail to reach $7.5m in spending. Judd-Stein, along with several other commissioners, requested language be added to the regulation that gave commissioners some options short of revocation or suspending a license.

“I like the idea of keeping our discretion,” she said.

The commission on Thursday (April 13) postponed any action on the regulation to allow staff to edit the rule and give Suffolk Downs time to comment on the proposed regulation.

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