Take The Good; Take The Bad
An Australian focus group points out the perceived pros and cons of cashless gambling, which happens to be one of the AGA's prime policy objectives.
The Bulletin Board
NEWS: Before it can reach widespread adoption, cashless gaming needs to overcome privacy concerns.
BEYOND the HEADLINE: A lot of people want to gamble anonymously.
NEWS: A PA man is accused of misappropriating millions of dollars, including repeated fund transfers to sportsbooks and sites.
NEWS: NCLGS has a new president, West Virginia Del. Shawn Fluharty.
BEYOND the HEADLINE: Why you should strongly consider going to the NCLGS conferences.
AROUND the WATERCOOLER: Is a new California sports betting initiative in the cards, and who is commenting on sports betting?
STRAY THOUGHTS: Why the toothpaste rarely goes back into the tube.
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The Cashless Gaming Opportunity
Among the policy objectives of the American Gaming Association (AGA) is the proliferation of cashless gambling.
In a 2020 interview (paywall), AGA President and CEO Bill Miller highlighted three main objectives for the organization:
Getting sports betting right.
Telling a positive story about gambling.
Modernizing the industry.
On Point #3, Miller focused on cashless gambling.
“For the life of me, I don't understand how an industry that is as modern as the twenty-first-century gaming industry can offer guests first-in-class hospitality, restaurants, entertainment, spas, and all sorts of exciting opportunities, and yet if they walk onto the casino floor and they want to pay digitally in the same way that they've paid for every other part of their experience, it's unwelcome.
“I think there's a great opportunity… to help bring the industry together on something that will not only strengthen opportunities for the industry but also strengthen opportunities for law enforcement as it relates to Know Your Customer and anti-money laundering compliance.”
But cashless gambling isn’t without its risks.
A new academic paper titled, Cashless gambling: Qualitative analysis of consumer perspectives regarding the harm minimization potential of digital payment systems for electronic gaming machines, concludes with, “Perceived irrelevance and privacy concerns appear to be major barriers to adoption of a cashless gambling system with strong harm reduction features.”
It should be noted up front that this was a 26-person focus group (the title has nearly as many words as there are participants) and correctly uses the word qualitative rather than quantitative, so take the results with a grain of salt. It also sits behind a paywall, so I have not had the chance to read the full paper.
What I found interesting was the general views on cashless gambling and how that fits with my thoughts on anonymity in gambling (see Beyond the Headline below).
The paper’s abstract reads:
“Cashless gambling was perceived to present important opportunities for more useful and meaningful harm reduction measures based on the ability to track a user’s complete gambling activity.
“However, participants reported reluctance toward adoption of cashless gambling, tending to perceive such systems as being overly restrictive and invasive, and potentially facilitating (over)spending, depending on design and implementation.”
The focus group also believed these systems offer “little value to individuals who gamble without experiencing significant harms.”
Beyond the Headline: Gamblers Like Anonymity
When I’m asked why someone with access to a legal gambling site would stay in the black market, I have a list of reasons teed up. One of those reasons is anonymity.
Most people don’t brag about or even openly discuss their alcohol consumption or drug use, and that is certainly true for people in the throes of addiction. Gambling is no different. Most people don’t advertise their gambling.
As responsible gambling consultant Jamie Salsburg recently tweeted, “Once again, I’ll point out that the gambler’s mindset is that they will get back to even without anyone ever knowing just how bad things actually were. Doesn’t matter how big the hole becomes, they use past successes to drive the fantasy of returning to even.”
Or as industry analyst Alun Bowden noted recently [bold mine], “A number that most even in the industry don't realize is 28% of all gambling spend in the UK in 2021 was in online casino. Twenty-eight percent. In total, it was £3.9b, which is roughly £75 for every adult in Britain. And yet, you almost never meet anyone who does it...”
Offshore sportsbooks and gambling sites allow bettors to hide their gambling activities from their friends and family. Whether it’s innocuously coded credit card and bank transactions or the lack of tax forms, illegal gambling offers a level of privacy unavailable in regulated markets.
The cash-centric US casino economy provides similar cover to anyone wishing to hide their gambling (regardless of the reason, of which there are many). Cashless gaming would make that far more difficult.
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Newsflash: People Steal Money to Gamble
A Pennsylvania title agent is facing some serious legal problems after it was discovered that an escrow account he was managing was missing $5.6 million.
Per reporting by Penn Live, “There were repeated fund transfers to sportsbook and sports gambling companies from an escrow fund set up by title agent Louis Belletieri, according to the lawsuit filed by Fidelity National Title.”
Belletieri is also alleged to have purchased gold bars and other items with the funds.
These stories are not uncommon, nor are they limited to online gambling or sports betting.
This actually hits close to home, as a former neighbor of mine (who I didn’t even know gambled) found himself in a similar situation in 2019 after embezzling $1.3 million in his role as a part-time bookkeeper.
Per the Middlesex County DA’s office, “The Child Health Center subsequently learned that Mr. Mallios had allegedly stolen over $470,000 from them. In total, the defendant allegedly stole over $1.3 million from 2014-2018. During that same time frame, the defendant allegedly frequented two gambling establishments, losing over a million dollars playing slot machines.”
Sticking to stories like this near me, here’s a 2022 story about someone who stole $200,000 while working at a pub and another from 2014 about someone embezzling $2.7 million who engaged in “a high volume of gambling at Twin River Casino in Rhode Island.”
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WV Del. Shawn Fluharty Named Next NCLGS President
The National Council of Legislators from Gaming States, or NCLGS for short (pronounced “nickel-jeez”), will soon have a new president. On October 15, West Virginia Delegate Shawn Fluharty is set to take over from Indiana State Rep. John Ford following the latter’s retirement from the Indiana legislature.
“I found working with NCLGS to be very refreshing because the organization is built around the principles of getting the best and the brightest in the gaming industry into one room to discuss the issues of the day,” Ford said in a press release. “The organization helped me learn about all aspects of gaming, from horse racing to lotteries and casinos to digital gaming and sports betting.”
Under Ford, NCLGS launched several initiatives, including a resolution on responsible gambling and the launch of the Bet On Policy, Baby! podcast.
Fluharty is a familiar name in gambling, as he was a driving force behind West Virginia’s foray into sports betting and online casinos and has been a vocal supporter of online poker.
He is also more candid than the typical lawmaker, which is something that is sorely needed at this moment. Fluhartey’s unapologetic support of legal, regulated online gambling is precisely what is needed as the focus shifts from sports betting to the more controversial online casino and poker.
In a LinkedIn post, Fluharty also answered the most pressing question people have, “Obviously, the most important question is whether Jon Ford will still be in the podcast?!? The answer is yes. See you at G2E.”
Beyond the Headline: Why You Need to Attend NCLGS
NCLGS is one of the longest-running conferences in the gaming space.
Founded 25 years ago, NCLGS holds two meetings annually, one in the summer and one in the winter. NCLGS conferences are hidden gems on the conference calendar. They are multi-day affairs with just a few hundred attendees, with lots of key lawmakers, regulators, and high-level decision-makers from the industry. That makes NCLGS a networker’s dream and provides journalists unparalleled access to the movers and shakers.
The conference is also where you uncover what states are considering legislation. This is accomplished in a few ways:
Who is there?
Who is asking questions from the audience?
Who is talking to whom?
Mega conferences like G2E, ICE, and IGA are terrific, but everyone is incredibly busy, and public chatter tends to be boilerplate. If you’re trying to check the pulse of an individual state, no conference can rival NCLGS.
Around the Watercooler
Social media conversations, rumors, and gossip.
California’s next sports betting initiative may be coming sooner than expected. Per Victor Rocha, there’s chatter about a late initiative filing.
And for those who think this is just a guy hearing a rumor, when it comes to California tribes, Victor is far and away the most plugged-in person there is.
Play USA’s Matthew Kredell is hearing the same rumor and put a name to the tribe, writing, “The Pala Band of Mission Indians relayed its intention to file what’s expected to be an online sports betting initiative.”
And in “I didn’t have that on my bingo card” news (h/t Jamie Salsburg), political commentator John Harwood decided to throw some shade at sports betting. As with most of these opinions on gambling from non-gamblers with big followings, the replies are interesting.
Stray Thoughts
A lovely quote that is almost universally true from an article on North Carolina gambling expansions.
“Once a gaming debate begins, it does not end until there is success for the gaming industry. It may take two years. It may take 20 years, as it did in Pennsylvania. But eventually, the economic and marketing forces will prevail.”
Joseph Weinert, executive vice president of Spectrum Gaming Group