Since Gov. Kathy Hochul approved the issuance of three downstate casino licenses in New York two years ago, it has long been believed that the existing racinos were shoo-ins to receive one.
Now, thanks to some legal issues in Las Vegas, existing video lottery terminals Resorts World New York City and Empire City Casino may face rockier roads. As will the proposed Wynn New York City project at Hudson Yards.
During the most recent meeting of the New York State Gaming Commission, Chairman Brian O’Dwyer noted his concern surrounding the two racinos and the Wynn proposal as a result of “various violations of the law” in Las Vegas. Added O’Dwyer:
“[I]t is the responsibility of this commission to assure that our licensees exhibit the utmost integrity and have established robust procedures with their employees to assure strict compliance with our laws and regulations.”
NYSGC notes indiscretions of former Resorts World, MGM exec
Resorts World, Empire City, and Wynn are part of a group of a dozen bidders vying for three downstate licenses, which could allow owners to offer online casinos in New York once lawmakers legalize iGaming.
But Sin City issues have earned the attention of NY regulators.
In his meeting report, O’Dwyer cited a 12-count complaint against Resorts World Las Vegas for allegedly violating anti-laundering laws by allowing illegal bookmakers “to gamble in the millions of dollars.” These allegations stem from a situation involving Scott Sibella, a former Resorts World executive who pleaded guilty to failing to file a suspicious activity report after reports surfaced that Sibella knowingly allowed criminals to use “ill-gotten” money in the casino. Sibella was also an executive with MGM, which operates Empire City Casino.
It should be noted, though, that the Las Vegas property is owned by Genting Berhad, while a separate publicly traded company, Genting Malaysia, runs Resorts World NYC. As such, while they hold similar names, the Las Vegas and New York properties are not directly involved with each other or their related affairs.
“The allegations to complain are particularly disturbing,” O’Dwyer said during the NYSGC meeting, “in that that alleges a culture of non-compliance in that information on illegal or suspicious activity was either negligently or worse willfully disregarded to promote financial gain.”
Wynn also in crosshairs of NY casino regulators
O’Dwyer also noted the legal troubles surrounding Wynn Resorts, which looks to develop the Hudson Yards are to create Wynn NYC.
The chairman pointed out that Wynn agreed to forfeit over $130 million to the United States Department of Justice after an investigation revealed that Wynn allegedly conspired with unlicensed money transmitting businesses around the world in order to “transfer funds for the financial benefit of the casino,” according to a DOJ report.
According to the DOJ, it represents the largest forfeiture by a casino based on admissions of criminal wrongdoing.
“These allegations are serious,” O’Dwyer said, tying all three bidders into one summary, “but I must emphasize that in one instance the complaint is still pending and in the other the USD Department of Justice settled the matter without filing criminal charges.”
O’Dwyer emphasized that the final step in awarding a downstate casino license involves state regulators reviewing all information before them. And he assured that the NYSGC “will conduct a thorough review” of each bidder.
“In doing so we will review all relevant data as to whether a potential licensing possesses the qualifications to hold a casino license and we will thoroughly review all relevant material, including of course, the allegations lodged against Wynn and Resorts World.”
