News In Brief: September 19-September 23, 2022

September 23, 2022
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New lotteries created in Brazil, William Hill fined $100,000 in Nevada and PlayUp to complete SPAC listing.

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Brazil President Signs Law To Create Two New National Lotteries

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President Jair Bolsonaro has signed into law a bill to create a national health lottery and tourism lottery to benefit two sectors of the Brazilian economy that were hit hardest by COVID-19.

The two new lotteries will be permitted to operate through both retail and digital channels and offer all forms of lottery games already recognised by Brazilian law, including fixed-odds sports betting.

Operators of the two lotteries will be required to return 5 percent of fixed-odds bets to specific health or tourism funds and to Brazilian sports teams, according to Law 14.455 as published in the Brazilian government’s official gazette on Thursday (September 22).

That is a different structure to the blended turnover- and revenue-based tax rates that will apply to private operators of fixed-odds betting under a December 2018 law that is still awaiting implementation by Brazil’s government.

Bolsonaro did veto one provision of the lottery legislation as approved by Congress in August that would have required the Ministry of Economy to publish rules for a concession process for the two new lotteries within a period of just 30 days.

The health and tourism lotteries will join Brazil’s established national lottery operated by the Caixa Economica Federal public bank. As a result of a September 2020 Supreme Court decision, various Brazilian state and municipal governments are also introducing their own local lottery operations.

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Nevada Fines William Hill $100,000, Licenses Bally’s

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The Nevada Gaming Commission on Thursday (September 22) unanimously approved a $100,000 fine against Caesars Entertainment’s William Hill and several affiliated companies to settle a four-count complaint over thousands of duplicate losing wagers and erroneous winning bets.

Three of the counts stemmed from a problem in the company’s CBS Race and Sports mobile wagering system, which produced duplicate wagers on some 55,000 sports bets.

In its complaint, the Nevada Gaming Control Board (NGCB) said William Hill failed to respond promptly to regulators when the problem of the duplicate wagers was first discovered. The company also failed to respond in a timely manner to customer complaints.

A fourth count in the complaint involved William Hill’s failure to deal promptly with the alleged theft of $3,335 by a sportsbook writer at a casino in West Wendover, who placed illegal wagers with the funds taken from his cash drawer.

The five-member commission also approved Bally’s Corporation’s $308m acquisition of the Tropicana Hotel and Casino on the Las Vegas Strip. Penn Entertainment currently operates the casino.

Bally’s president George Papanier told the NGC that the company views the Tropicana as a flagship property in its western region. The company operates 17 casinos in 11 states, and also has market access for sports betting in 19 states.

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PlayUp To List On Nasdaq Through SPAC Merger

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Australia- and U.S.-facing betting operator PlayUp is set to become a Nasdaq-listed enterprise after agreeing to merge with IG Acquisition Corp., a special purpose acquisition company (SPAC).

The transaction announced on Thursday (September 22) values PlayUp at $350m and is expected to close in the first quarter of 2023.

PlayUp currently operates online sports betting in New Jersey, Colorado and Australia, as well as fantasy sports and other products in India and other markets. Company-wide revenue grew 56 percent to $36.6m in the year to June 30, according to a Nasdaq filing accompanying Thursday’s announcement.

PlayUp is set to follow the likes of DraftKings, Genius Sports, Rush Street Interactive, Codere Online, Betway parent Super Group and Malta-based Novibet in listing in the U.S. through a SPAC.

IG Acquisition Corp. was formed in 2020 and is led by Christian Goode, a former senior executive for Genting Americas who will become president of PlayUp’s U.S. business upon completion of the transaction.

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China's Ambassador Weighs In On POGO Traffickers

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Beijing’s envoy to the Philippines has resumed calls for tougher government treatment of the online gambling industry, a week after 173 captive staff were rescued from two foreign-facing online gambling companies (POGOs).

Chinese ambassador Huang Xilian on September 21 met Philippine justice secretary Jesus Crispin Remulla in a meeting focusing on “jointly cracking down on POGO-related crimes” such as labour trafficking and detention.

“It is reported that most of the recent crimes targeted at Chinese citizens in the Philippines are related to POGOs,” an embassy statement said.

“Crimes induced by and associated with online gambling not only harm China’s interests and China-Philippines relations, but also hurt the interests of the Philippines.

“The Chinese side welcomes the Philippine side to take strong measures to crack down on crimes related to POGOs, and tackle its root cause so as to address the social ills in a sweeping manner.”

Huang’s comments amount to a moderate stance compared with the embassy’s angry attacks on the online gaming industry and Philippine officials in 2019, suggesting that Beijing has shifted to a strategy of cooperation as the political mood for POGO licensees deteriorates.

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Western Australia Passes Tougher Casino Controls

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Western Australia state lawmakers on Tuesday (September 20) passed an amendment bill that imposes a maximum fine of A$100m ($66m) for illegal casino activity, appoints an independent monitor of operations and strengthens casino regulation.

The state parliament passed the Casino Legislation Amendment (Burswood Casino) Act 2022 in response to recommendations from the Royal Commission into Crown Resorts’ operations in Perth.

The new maximum fine is a 1,000-fold increase from A$100,000, consistent with reforms in other Australian states.

The independent monitor will supervise Crown Resorts’ remediation process at the Burswood property following the Commission’s finding that it is not suitable to hold a casino licence.

The bill also grants more powers to the state's Gaming and Wagering Commission and for the appropriate minister to direct it, while allowing an independent chair to head the regulator in view of its poor track record.

Racing and gaming minister Tony Buti said in a statement that “further work is under way to look at how we can also reform the Casino Control Act 1984”.

The changes are the latest in a slew of reforms cracking down on gaming around Australia in response to misconduct by Crown Resorts, The Star Entertainment Group and other land-based gaming interests.

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Victoria Approves More Controls On Crown Resorts

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The Victoria state parliament has passed another tranche of amendments to operating conditions for Crown Resorts’ Melbourne casino, including identification checks, cash limits and mandatory pre-commitment for slot machines.

The Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022 passed the Legislative Council on Tuesday (September 20), the third such package of tough reforms since the release of a withering Royal Commission report into Crown Melbourne operations in October 2021.

Based on Royal Commission recommendations, the 12 new changes include mandatory identification checks for casino entry and when claiming winnings greater than A$1,000 ($670). A A$1,000 limit for cash use will also apply per 24 hours.

The mandatory pre-commitment scheme for slots and other electronic gaming machines (EGMs) will be in force by the end of 2023, with certain technically difficult reforms delayed until December 2025, the government said in a press release.

Amendments have also been made to governance, ownership criteria, player exclusion and smoking rules, among others.

The pre-commitment changes come only days after Tasmania became the first state government to announce a mandatory scheme for EGMs, with implementation by the end of 2024.

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Missouri Sports-Betting Bill Tabled During Special Session

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A sports-betting bill introduced during the first day of a special legislative session received a hearing on Monday (September 19), but Republican Governor Mike Parson has blocked any consideration of the measure as lawmakers consider tax cut legislation.

Republican Representative Dan Houx introduced House Bill 4, a similar measure to the House-approved HB 2502, which legalizes retail and online sports betting in Missouri. HB 2502 was approved by the House by a 115-33 vote, but never received consideration by the full Senate.

Parson announced prior to the committee hearing that sports betting was not part of the special session’s agenda. The governor’s office did not immediately respond to a request for comment.

Kelli Jones, a spokeswoman for the governor, told the St. Louis Post-Dispatch that sports betting was clearly beyond the call and does not relate to Parson’s topics in the special session.

“I do not anticipate sports betting being part of [the] special session,” Jones said.

Houx’s bill was heard Monday by the House Emerging Issues Committee and has garnered support from the NHL’s St. Louis Blues and MLB’s St. Louis Cardinals. Houx told the committee that introducing the bill was about keeping the issue of sports betting at the forefront.

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Nevada Seeks To Fine William Hill $100,000 Over Duplicate Wagers

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William Hill, a unit of Caesars Entertainment, is facing a $100,000 fine to settle a four-count complaint filed by the Nevada Gaming Control Board (NGCB) over thousands of duplicate losing wagers and erroneous winning wagers made through its mobile app in the state.

According to an August 24 complaint published last week, an NGCB investigation determined that erroneous duplicate wagers had been occurring since 2015. Further, William Hill determined that, prior to June 2021, in the instances when a customer reported a duplicate wager, they were likely refunded their money to resolve the issue, but no further action was taken.

Investigators noted that 42,000 erroneous duplicate losing wagers in Nevada through December 20, 2021 resulted in customers losing approximately $1.3m, while 13,000 erroneous duplicate winning wagers through December 20, 2021 resulted in customers winning approximately $2m.

William Hill was also cited for a lack of reporting employee theft within a timely manner.

The company discovered a $3,335 cash shortfall on April 12, 2022 at its sportsbook at the Red Garter Casino in West Wendover and did not report the theft until May 12, 2022. William Hill determined that an employee working as a ticket writer made multiple unlawful wagers using money from his bank drawer.

The Nevada Gaming Commission (NGC) is expected to approve the $100,000 settlement at its meeting on Thursday (September 22). The five-member commission is also expected to grant final approval to Bally’s Corporation’s $308m acquisition of the Tropicana casino in Las Vegas.

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Netherlands Regulator Launches Addiction Research Programme

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The Netherlands Gambling Authority (KSA) has launched a three-year research programme to gather information to help prevent gambling addiction, improve treatment services and reduce gambling-related harms.

The "Prevention of Gambling Addiction" programme has already started and will run through to 2025. It is being overseen by ZonMw, a government organisation that finances health research and is funded by the country’s Addiction Prevention Fund.

Within the programme, there are two open funding rounds for where research projects can be submitted.

The first funding round is expected in early 2023.

ZonMw said it wants a mix of “short-term projects that quickly lead to results and four-year projects that yield valuable knowledge in the longer term”.

These projects will allow researchers to collaborate with various stakeholders, including experts by experience, policy and education.

The research follows a study of existing academic literature undertaken by Trimbos, an NGO offering policy and research insights into mental health and addiction, which flagged areas requiring additional research.

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Malta's Prime Minister Says Gambling Industry 'Strengthening'

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Malta Prime Minister Robert Abela visited the local offices of Evolution and Flutter last week and claimed the Maltese online gambling industry is strengthening as a result of investments made on the back of the sector's “trust” in the country.

In both visits, Abela praised the companies for their eight years of contributing to the country’s economy as well as the industry’s importance to Malta and the innovation it brings to the island.

“The Prime Minister stressed that in the face of the trust shown we should continue to incentivize while remaining effective with a regulatory framework that makes our country a serious jurisdiction in such an important industry,” according to a press release from his office.

Flutter and Evolution together employ more than 2,000 people in Malta.

Abela was joined by Silvio Schembri, Malta's minister for the economy, EU funds and lands.

Malta was placed on the Financial Action Task Force’s (FATF) "List of jurisdictions under increased monitoring", known as the greylist, in June 2021.

VIXIO GamblingCompliance’s own analysis found that in the months after Malta joined the greylist, regulatory impact rose tenfold from a small fraction of the global average to several times the level of impact.

Malta moved off the list on June 17 after FATF officials cited improvements in its anti-money laundering standards.

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New lotteries created in Brazil, William Hill fined $100,000 in Nevada and PlayUp to complete SPAC listing.

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