New CEO of Ladbrokes?
BCN World Barcelona all over?
Andrew Tottenham money laundering article
InfinityGaming
www.gaming-awards.com | ISSUE NOVEMBER 2014
The App Awards
All the winners inside
The IGA Finalists
Announced for 2nd Feb gala event
EXCLUSIVE INTERVIEW HENRY BIRCH
BUSINESSMAG • ISSUE DECEMBER 2014
Chief Executive Rank Group
FEATURE
A Christmas tale from Tina Thakor-Rankin
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contents InfinityGaming
EDITOR’S LETTER
The App Awards Ceremony................................04-19 The Winners & all the photos
Exclusive Interview Henry Birch........................20-23 Chief Executive of Rank speaks to Infinity
Gaming Awards Finalists Announced.............24-29 Find out who made the exlcusive shortlist for 2nd February
NEW Chief Exec of Ladbrokes found?.............30-31
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THE APP AWARDS
High Specualtion new boss has been discovered
US Gaming News.....................................................32-33 Taj Mahal latest and Horseshoe casino news
The Ghost of Christmas Past...............................36-39 Christina Thakor-Rankin seasonal article
UK Gaming News.....................................................40-41 Sky sell online gaming arm
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HENRY BIRCH
Macau latest Gaming News................................42-43 Macau facing uncertain 2015
BCN World Barcelona.............................................44-45 Could it be the end of the Casino resort plan?
Marty Baird latest excellent article...................46-48
The December edition of Customer Service
Gold Coast question...............................................52-53 Echo boss questions viability of resort
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GHOST OF XMAS PAST
InfinityGaming • ISSUE DECEMBER 2014
Gala merge their online........................................54-55
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Now one big family
Andrew Tottenham latest article.......................56-59 December article Money Laundering
Infinity Gaming........................................................ How and where can you read the magazine?
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MONEY LAUNDERING
EDITOR’S LETTER Lana Thompson - Chief Editor
by
EDITORS NOTES
InfinityGaming
Welcome to the December edition of the Infinity Gaming Magazine.
CONTRIBUTING WRITERS Christina Thakor-Rankin Martin R. Baird Alex W Pariente Andrew Tottenham JJ Woods Professor Nelson Rose
What a month this has been, we launched the App Awards on the 8th December with attendees from Europe and the US flying in to celebrate an industry that now has had over 70 billion downloads! Very positive things from that event and will now be a permanent fixture on the awards calendar for the App Gaming Industry. Congratulations to the finalists and winners. You can see all the photos inside. Not just that but the finalists of the 8th International Gaming Awards have been announced following weeks of deliberation from our judges. We want to thank each and every one of them for their time and support, thanks guys and gals. You can view the full list of all the finalists inside, can’t wait till the 2nd February going to be a great fun night at the Savoy Hotel and looking forward to meeting you all there.
Of course we have some truly amazing articles inside as always from Marty Baird, the superb Andrew Tottenham talking about an industry taboo subject and the equally brilliant Tina Thakor-Rankin and her seasonal take on The Ghost of Christmas Past. Not forgetting our Exclusive interview with the Chief Executive of the Rank Group Henry Birch. How do we fit it all in one magazine? I do not know, but enjoy the magazine all the seasonal best wishes and a Happy New Year to you all, catch you on the other side. Enjoy!
Lana x
CONTACT US Clever Duck Media Newmarket 20 Centrix@Keys Keys Park Road Staffordshire WS12 2HA UK Tel: +44(0)1543 478 889 claire@cleverduckmedia.com PRODUCTION Clever Duck Media Newmarket 20 Centrix@Keys Keys Park Road Staffordshire WS12 2HA UK
PUBLISHING Infinity Gaming Magazine is operated by © Clever Duck Media Ltd ® Company Reg. No. 687 1018 (Registered in England) ADVERTISING: Sponsorship Opportunities Colin@cleverduckmedia.com
Opinion Disclaimer: The views and opinions expressed in all external articles are those of the authors and do not necessarily reflect the official policy or position of The Infinity Gaming Magazine Any content provided by our feature writers or authors are of their opinion, and are not intended to malign any religion, ethic group, club, organization, company, individual or anyone or anything.
JOIN US
BUSINESSMAG • ISSUE DECEMBER 2014
Business Partnerships Svetlana@gaming-awards.com
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BUSINESSMAG • ISSUE DECEMBER 2014
C H A M PA G N E R E C E P T I O N A P P AWA R D S 2014
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The Champagne Reception APP AWARDS 2014
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hen the first ever App Awards took place on the 8th December operators turned up from all over the World for a glamorous afternoon at the Jumeirah Carlton Hotel in Knightsbridge.
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BUSINESSMAG • ISSUE DECEMBER 2014
Great atmosphere, lovely people and so relaxed, the making of a truly superb event, bring on 2015.”
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BUSINESSMAG • ISSUE DECEMBER 2014
A brilliant ceremony why the App Awards has not been done before is amazing, definately one that will be here for years to come, can only get bigger. ”
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App Awards The Ceremony
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n the 8th December 2014 the App industry turned out for the first ever Gaming App Awards, to recognise and celebrate the huge success of the App. Now with over 70 billion downloads to date, which is ten downloads for every person on the palnet, why the App Awards did not happen sooner is a mystery.
Well no longer the App Awards have arrived, with attendees from all over europe and the US a new event is on the calendar.
InfinityGaming • ISSUE DECEMBER 2014
It was only in 2008 that the first ever App was born and back then there was only 800 Apps available in the first year to download. Now there is over 3 million Apps available between Apple and Android Stores. We have come a long way in just 6 years, but the journey has only just begun.
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The first ever App Awards “And the Winner is”
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APP AWARDS
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01 02 Winner Best Bingo App - Mecca Bingo
03 Winner Best Casino App - Playtech Casino
04 Winner Best Social Gaming App - Vegas World - Flowplay
BUSINESSMAG • ISSUE DECEMBER 2014
01 Winner App of the Year - Unibet for Spin City
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APP AWARDS
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05 Winner Best Sports Betting App - Betsson
08 06 Winner Best Social Poker App - PokerStars Poker
07 Winner Best Slots Game App - LeoVegas
08 Winner - Innovative App of the Year - Pilot Games
APP AWARDS
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09 09 Winner Best Slots App - LeoVegas
12 10 Winner Best Poker App - Full Tilt Poker
11 Winner Best In-Play Sports App of the Year Playtech
12 Winner Best Free to Play App - Big Fish Casino
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The 2014 App A
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Award Winners
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EXCLUSIVE INTERVIEW
Exclusive Interview with Henry Birch CEO of Rank Infinity Gaming Magazine spoke to Hnery Birch the Chief Executive of the Rank group about how the company is doing since the Gala takeover, the US online gambling market, the UK land based gaming market and future acquisitions.
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: Henry thank you for speaking to the Infinity Gaming Magazine, for our international readers can you explain your role and what the Rank Group businesses are please? HB: I am the Chief Executive of the Rank Group. We consist of three businesses: Grosvenor Casinos, the UK’s largest casino operator with 57 casinos and 2 in Belgium; Mecca Bingo, a leading UK bingo operator with 95 clubs; and Enracha a Spanish bingo business with 7 clubs. In all businesses we operate both land-based and digital gaming and entertainment. In our last financial year we generated over £700m in revenues.
InfinityGaming • ISSUE DECEMBER 2014
Q: You took the role in May this year after Ian Burke stood down, how has the last few months been, is the role more challenging than you thought it would be?
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HB: I have had a very interesting, rewarding, but busy first 6 months! Not only have I been trying to learn as much as I can about our company, but with a large staff to meet and 160 or so venues to try to visit, I have had fairly full days. Like all businesses we face challenges, but in most cases they are also significant opportunities that I feel we are well placed to take advantage of. I am lucky in that I have inherited a strong team in Rank and that, in Ian, I have a very supportive and knowledgeable chairman.
Q: The company acquired Gala Casinos last year how has the integration of the two casino brands gone and would you call it a success so far? HB: Yes, I think it is fair to say that the acquisition has been a great success, both in terms of a smooth integration process and the way in which the acquired casinos have performed financially. We’ve been particularly impressed by the way in which former Gala employees have embraced their new ownership and the professionalism and commitment they’ve displayed. Q: The UK market seems to be recovering from recession and business is picking up according to reports, would you agree with that assumption and has the company seen improved results on that? HB: : I think it is always hard to extrapolate from macro-economic trends to a company’s performance, particularly in the gaming sector. Historically there are many instances of the gaming industry bucking wider
to bed in and reach its potential, but Southend is a great club in an established market. Q: Your most recent background is from the online business where you were CEO of William Hill’s online sector. How difficult has it been working in a business that encompasses both land based and online?
economic trends, so I’d be wary of reaching any conclusions in this regard at the moment, particularly as I am not convinced that an improved economy has translated to more money in the UK consumer’s pocket. We are certainly seeing positive signs in our businesses, but I am not sure we can put these down to an improved economy.
Q: Grosvenor casinos have just opened up a new casino in Southend, how has the early business been there? HB: It is very early days – less than 2 months in – but so far we are pleased with progress. Experience has shown us that it takes a good two to three years for a new casino
Q: Is it a strategy by Rank to push the online business further and compete harder given your wealth of experience in the online business? HB: Our strategy is to grow all our channels by focusing on the assets we have at our disposal. I would argue that with our combination of venues, strong digital businesses, our customer base, 11,000 employees and strong brands we are better
BUSINESSMAG • ISSUE DECEMBER 2014
HB: I had exposure to William Hill’s land-based business and likewise have dealt with land-based gaming in the past, so it is not necessarily a new challenge. The reality today is that most gaming executives are comfortable working across both venues and digital and there is a lot of commonality – in product, customers and service. My main challenge at Rank is setting the right strategy, focus and vision for the company and ensuring that the many talented people we have can fulfil their potential.
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Q: As we have all seen this year has all been about acquisitions with many of the large international companies consolidating their position with high profile purchase, do you see this strategy continuing in 2015 with more such acquisitions? HB: There is always attention on acquisitions – they make good news stories! – but yes, there does seem to have been a lot of recent consolidation particularly amongst
gaming suppliers. Clearly there is a limit as to how far this can go, but I always think that if there are two or three dominant providers, it opens up the door for smaller providers who can be more nimble and focus on a niche. I think that from an operator perspective, acquisitions are currently being somewhat held back by a re-evaluation of multiples in light of UK taxation and by uncertainty over regulation in some European and other markets. Q: Working in Europe with the regulations and freedom of gambling companies, what do you think of the US market and
in particular the online gambling business there? HB: Were it to be a regulated and open market, the US digital market would unquestionably be the largest in the world. Progress and growth in New Jersey and Nevada has been disappointing but in my view it is by no means an indictment of the potential of the US, more a reflection of the fact that current regulation has failed to keep out “black market” operators and regulated operators face too many operational burdens.
BUSINESSMAG • ISSUE DECEMBER 2014
HB: positioned than anyone in the UK to create a really compelling multi-channel gaming proposition.
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INTERNATION AWA
FINAL
2nd February 2015 - The Savoy Hotel, London Casino Operator Americas Codere S.A. Great Canadian Gaming Corporation Las Vegas Sands Corp MGM Resorts Wynn Las Vegas
InfinityGaming • ISSUE DECEMBER 2014
Casino Equipment Supplier
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Abbiati Bally Technologies, Inc. Cammegh Casino Technology Matsui TCS John Huxley
Casino Operator Asia/Australia Crown Resorts Limited Galaxy Entertainment Melco Crown Sands China Ltd Wynn Macau
Corporate Services Supplier All-In Translations Continent8 Microgaming Mr Green Optimal Payments PaySafe Skrill
NAL GAMING ARDS
LISTS
BOOK YOUR Aspers Group Casinos Austria International Casino Poland Hippodrome Casino Rank Group Ray Finland
iGaming Software Supplier BetConstruct CORE Gaming Limited GTECH Iforium Limited Net Entertainment Odobo Play’n GO
Casino VIP Room Bellagio Club Prive Casino de Monte Carlo, Monaco City of Dreams Galaxy Macau Horseshoe Casino Les Ambassadeurs
Innovator of the Year Bally Technologies BetConstruct Bit8 DiscountIF Evolution Gaming Net Entertainment Optimal Payments
BUSINESSMAG • ISSUE DECEMBER 2014
Casino Operator Europe
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INTERNATION AWA
FINAL
2nd February 2015 - The Savoy Hotel, London In-Play Sports Operator 888 Betsson Ladbrokes Paddy Power Unibet William Hill
InfinityGaming • ISSUE DECEMBER 2014
Online Casino Operator
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BetVictor Full Tilt LeoVegas Mr Green Unibet William Hill
Mobile Operator 7Red Colossus Bets LeoVegas Mecca Bingo Unibet
Online Gaming Operator Cherry Casino LeoVegas Mr Green Mecca Bingo Rational Group
NAL GAMING ARDS BOOK YOUR
Mobile Product CORE Gaming Limited GTECH LeoVegas Mecca Bingo Net Entertainment Play’n GO Playtech
Online Poker Operator 888Poker BetVictor FullTiltPoker PokerStars WSOP (Caesars) Unibet
Online Bingo Operator 888ladies Dazzletag Entertainment Mecca Bingo Tombola Bingo Unibet (Maria Bingo) William Hill
Online Sportsbook Operator Betsson Paddy Power Skybet Unibet William Hill
BUSINESSMAG • ISSUE DECEMBER 2014
LISTS
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INTERNATION AWA
FINAL
2nd February 2015 - The Savoy Hotel, London Payment Solutions Provider EMPCorp Neteller Optimal Payments Realex Payments SafeCharge LTD Skrill Holdings Ltd Ukash
InfinityGaming • ISSUE DECEMBER 2014
Slots Operator (online)
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Casumo Jackpotjoy Casino LeoVegas Mecca Bingo Mr Green Redcorp (7Red)
Socially Responsible Operator ALH Group Crown Resorts Limited Galaxy Entertainment Group Rank Ray Sands China
Technology Provider/Supplier BetConstruct Bit8 Continent 8 Technologies CORE Gaming Limited Iforium Limited Net Entertainment Odobo SafeCharge TCS John Huxley
NAL GAMING ARDS
LISTS
BOOK YOUR bwin.party digital entertainment plc Mr Green Rank Group Rational Group RAY Sky Betting & Gaming Unibet
Slot Provider/Supplier Bally Technologies Casino Technology GTECH IGT Net Entertainment Play’n GO Playtech WMS
BUSINESSMAG • ISSUE DECEMBER 2014
Socially Responsible Operator
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EUROPEAN GAMING NEWS
New Chief Executive at Ladbrokes found?
What odds on Patrick Jay as new Chief Executive
Following a torrid year for Glynn where pressure was placed on him after not sufficiently improving the companies digital business as fast as they would have liked the news came he was out. Now the smart money is on former Sports Director of Ladbrokes Patrick Jay to return to the bookmaker as Chief. Mr Jay departed Ladbrokes in 2010 to run trading operations at the Hong Kong Jockey Club, one of the world’s largest betting operations.
However he has recently quit his role citing that his children’s education would be better suited in the UK, not only that but reports coming from the Telegraph newspaper say that Mr Jay left early from Hong Kong to the UK possibly for a meeting with the powers that be at Ladbrokes. Amusingly the UK’s second largest bookmaker is running odds on whom would replace Glynn and they have slashed the odds on Mr Jay recently from 40/1 to 8/1! Are we to hear the announcement soon from Harrow HQ on the new
Chief Executive, well Ladbrokes themselves seem to think so.
BUSINESSMAG • ISSUE DECEMBER 2014
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here has been much speculation on whom would replace Richard Glynn ever since Ladbrokes announced that their Chief Executive was leaving.
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WORLD NEWS
Taj Mahal delays closure amid saving 3,000 jobs
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heTaj Mahal has delayed its closure date from the 12th December back to the 20th and even could be pushed back even further the owners say. As progress is being made with state officials over tax breaks and financial assistance it looks like the 3,000 workers there have a possible glimmer of hope that the casino resort could be saved and avoid being the fifth such casino to close in Atlantic City in a year. “The debtors continue to make progress with respect to various efforts that are critical to the suc-
cess of these chapter 11 cases and their ability to keep the Taj open, and therefore it remains possible that the current proposed closing date for the Taj … will be further extended,” the company wrote in its filing. That filing was made in response to a court motion by one of its restaurants, the Hard Rock, seeking to compel it to decide shortly whether it will keep its lease with the restaurant or reject it.
The owners of the Taj Mahal said it was hopeful it would obtain the necessary financial assistance from government stakeholders and reach a resolution with Local 54 so the Taj Mahal casino can stay open.
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altimore state officials have said that the Horseshoe Casino had not made as much money as they had hoped for after reporting monthly figures, in fact it was about 15% lower than expectations, pretty much the same as the previous month’s results. However Maryland Live at Arundel Mills the Horseshoes main competitor in Maryland held firm against possible falling revenues from
the Horseshoe, showing profits remained exactly the same as last year. Maryland’s five casinos generated $90.2 million in November, a 34% increase compared to the same period last year, the Maryland Lottery and Gaming Control Agency said. Excluding Horseshoe Casino Baltimore, revenue was flat, down by less than 1%.
The $442 million Horseshoe casino raked in $23.4 million in November. A state-backed study released last year estimated the casino by M&T Stadium would generate about $27 million a month in its first year of operation. Maryland Live generated $54 million, an increase of 0.77% compared with November 2013.
BUSINESSMAG • ISSUE DECEMBER 2014
Horseshoe Casino in Maryland not hitting the heights
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InfinityGaming • ISSUE DECEMBER 2014
PRESS RELEASE
TCSJOHNHUXLEY TO SHOWCASE INNOVATION AND EXCELLENCE AT ICE
Tristan Sjöberg, TCSJOHNHUXLEY Executive Chairman comments, “2014 has been a busy year for us and we are excited to present a lot of new products at ICE for the first time. Although the emphasis has been on developing and launching the new Gaming Floor Live platform, we have not diverted our focus from the existing product range. In fact, much of the established portfolio such as the benchmark Chipper Champ 2, SaturnTM Roulette wheel and e-FXTM display products are now technology enabled to connect to the new platform.”
The roll out of Gaming Floor Live continues. This not only includes the additional games of Roulette and Sicbo on the platform, visitors to the show will also see GFL Bonusing Solutions, the powerful Floor Wide Event and Mystery Progressive platform that can adapt to almost any table game and GFL Media, featuring e-FX table displays – the most comprehensive range of display solutions available for live gaming, with the ability to drive results from the game as well as media and event content. New additions to the range include the 21” Punto Banco Display, the 23” Portrait and Landscape displays and Multi Table Display which can show statistics, game results and animations simultaneously for up to 4 different tables on one screen. On show for the first time at ICE, will be the full Blaze LED surface technology suite for Roulette, Sicbo and Money Wheel. Blaze is a sophisticated illumination system designed to add excitement and en-
tertainment for players and increase security on the casino floor. The system features a slim-line, energy efficient LED matrix fitted below the cloth surface of the gaming table. Attraction sequences, winning number highlights and dynamic light displays are fully customisable and integrate with e-FX displays and Gaming Floor Live. The SaturnTM Auto wheel, also sees its launch and is the latest addition to the company’s world-renowned roulette wheel range. The SaturnTM Auto wheel is designed to sit perfectly on any live roulette table as it has the same footprint as a standard Saturn Wheel. Incorporating a patented ball firing mechanism, it has the flexibility to operate as a fully automated wheel using fixed betting cycles, driven by a third party system (ETG) or controller via a manual launch button. As with all our new TCSJOHNHUXLEY products, SaturnTM Auto integrates fully with Gaming Floor Live.
BUSINESSMAG • ISSUE DECEMBER 2014
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CSJohnhuxley the leading global innovator of Live Gaming Solutions will showcase its leading edge technology product portfolio at ICE. With a focus on key products such as the Gaming Floor Live platform featuring GFL Bonusing and GFL Media, plus the new Blaze LED technology suite of products.
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FEATURE ARTICLE
The Ghost of Christmas Past By Christina Thakor-Rankin Our superb feature writer Christina Thakor-Rankin compares the ghost of Christmas past to the HMRC and the gambling tax for her December seasonal article.
‘The UK white list was dead, to begin with. There is no doubt whatever about that. The register of its burial was signed by the Commission and the Commons, and the presiding judge at the Judicial Review. The Treasury did not sign it. But Treasury’s name was good upon ‘Change for anything it chose to put its hand to. The old white list was as dead as a doornail.’
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o might begin the gambling version of Dickens’ seasonal story – a cautionary tale of how the past impacts upon the present and the future, the influence of ‘ignorance’ and ‘want’, and the clear message to think about what the future holds and repent and make changes before it is too late.
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So might begin the gambling version of Dickens’ seasonal story – a cautionary tale of how the past impacts upon the present and the future, the influence of ‘ignorance’ and ‘want’, and the clear message to think about what the future holds and repent and make changes before it is too late. Where however, Dickens requires
the assistance of all three apparitions to show Scrooge the error of his ways, the gaming industry needs only one – the ghost of Christmas Past.
Gambling tax is not a new concept. In fact, the UK has always taxed gambling – initially the tax being paid by the customer at 10% and then 9% - on either their stake or
their winnings. The switch from customer paid gambling tax to operator paid Gross Profit Tax was brought about by the first off-shore revolution in the final years of the 1990s. UK operators faced losing their traditional customers to a new generation of off-shore operators offering duty free betting to UK customers. An advertising ban prohibiting off-shore firms from targeting the UK had little impact as customers actively sought out those companies who could offer them better terms, after all, why would any UK customer continue to play with a UK operator who added 9% tax to their stake, or took
In short, too high taxation, advertising ban circumvented by customers seeking better deals, and limited powers of enforcement against those who operated illegally. The only way for UK operators to survive was to move their remote operations (then predominantly tele-betting) so that they too could offer tax free betting. The net impact was, not unsurprisingly, a significant drop in tax revenue, UK jobs moving off-shore and no controls or protections for players. Gross Profit Tax in 2001 was designed to re-dress the balance: shifting the tax burden from the customer to the operator, allowed UK companies to offer tax free betting within the UK, and a gentleman’s understanding that UK firms would repatriate bringing back jobs and players to the UK. Whilst there
were many factors behind the decision, what is often forgotten is that the introduction of GPT also saw an increase in tax – whilst the outgoing customer gaming tax was 9%, the incoming GPT was set at 15%. Given that only a few years earlier betting tax had been reduced from 10% to 9% the alarms bells should have started to ring out then, but when GPT was introduced the UK industry, and the world, were both very different places. The gaming sector was predominantly land based and remote was extensively driven by telephone betting. The internet was still in its infancy and user penetration fairly low, so whilst operators saw some overseas business, the UK market was naturally ring-fenced and able to support a higher level of tax at the time. At the time no-one could have predicted at the time exactly how this technology would revolution-
ise both the world and the gaming industry, but within only a matter of a few years, the UK was again under attack. This time however the number of marauding overseas operators was not a handful, but hundreds, and the imbalance no longer a customer facing 9%, but operator bottom line hit of 15%. Conversely, this meant that offshore operators had 15% more to spend on marketing and customer bonuses, so again, not unsurprisingly, UK operators were losing out. The changes to the Gambling Act in the noughties attempted to address and acknowledge the global nature of internet gambling and its impact on UK operators by bringing in the white-list. Whilst this considered the impact on jobs and player protection, it failed to resolve the real issue of tax. In fact the white list made matters worse by sending out the message that it was acceptable to target UK customers from overseas jurisdictions – provided it was an approved jurisdiction.
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9% tax from their winnings if they could play tax free with someone in Gibraltar or the Isle of Man?
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the legal and penalises or prohibits the illegal – right now it has neither. What we have is; too high taxation, advertising ban circumvented by customers seeking better deals, and limited powers of enforcement against those who operate illegally – in short, we are back to where we started.
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nce again, operators had no choice but to leave the UK in order to survive. Once again the Treasury lost out.
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The latest changes to the Gambling Act appear to have finally taken into account the fact that gambling regulation and gambling tax must work together. The UK white list which legitimised targeting UK customers from overseas has gone (but in today’s .com driven world, this was only ever a red herring), and an attempt has been made to link UK customers with UK tax by rebranding GPT as the new PoCT.
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And this is where the UK falls down. GPT was a ‘time-warp’ tax which could only ever have worked within the narrow context of the times in, and for which, it was created. The world has changed and is continuing to change. A tax, which with hindsight was behind the times 13 years ago, is even less appropriate today. If 15% has been too high for the last decade, what logic dictates that imply changing its name will make it suddenly sustainable? What the UK sector needs is taxation and a system which is fit for purpose: taxation which is fair and proportionate and a system which protects
Unlike Scrooge, who needed the aid of the ghosts of Christmas Present and Future to show him the error of his ways and how things might turn out without a change of course, we needed only one apparition, the gambling industry needs only one – to see what both the present and the future hold, we need only look to the ghost of Christmas Past. As Tiny Tim, might have observed in the gambling version of events ‘God help us – Everyone’.
ABOUT THE AUTHOR Christina Thakor-Rankin is Principal Consultant at 1710Gaming working with start-ups, investors, operators regulators, and industry groups internationally, covering all aspects of the gaming and gambling cycle - from initial research, licence and operational go-live, to new markets and opportunities, to customer engagement and experience. She has over 20 years industry experience and has previously held roles at William Hill, Blue Square, Tote (Sport) and Virgin Games managing multiple business disciplines, functions and teams.
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BUSINESSMAG • ISSUE DECEMBER 2014
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InfinityGaming • ISSUE DECEMBER 2014
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The Rational Group operates gaming and related businesses and brands including PokerStars, Full Tilt Poker and the European Poker Tour. These brands collectively form the largest poker business in the world comprising online poker games and tournaments, live poker competitions and poker programming created for television and online audiences.
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GAMING NEWS
Sky sells online gaming business will retain 20% of the business and hold a seat on the new look board. The broadcaster’s chief executive Jeremy Darroch said: “In the last 10 years, we have successfully grown Sky Bet from a start-up to one of the leading online betting and gaming companies in the UK.”
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ky Betting & Gaming based in Leeds has sold 80% of its business to venture capital firm CVC Capital Partners, with the deal expected to go through early in 2015. Sale of the betting arm of Sky will generate £600 million once the deal is completed, but the satellite broadcaster
All the current staff will be based in Leeds and move to new premises, CVC has previous experience in the betting and gaming sector through previous investments in companies such as William Hill and IG Group. In the current year to June, Sky Bet generated net revenues of £182 million and profits before tax of £50 million.
Betfair returns £200 million to shareholders on increased results & pulls poker from NJ
Betfair which announced that profits were up by 51%
for the first half of the year have also said they will be returning £200 million to shareholders in high dividend payouts.
With £271.4 million in excess cash the firm said it would up the dividend stake by 50% to an extra 9 pence a share. At the same time the betting firm said it raised its full year results forecast to £97-£103 million reflecting the success of the first half. On the other side of the Atlantic Betfair has announced it is pulling its online poker platform from the
New Jersey online gambling market, however the betting firm said that it would continue offering online casino games to players in the state. The move now follows Ultimate Poker who pulled out of New Jersey in October with their online poker product after poor revenues.
BUSINESSMAG • ISSUE DECEMBER 2014
The betting exchange firm said Thursday that earnings for the six months to October stood at £73.9 million up 51% from the same period last year, revenues also rose by 26% to £237.9 million.
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MACAU GAMING NEWS
Macau to suffer bad December
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nalysts believe that December will mark the seventh straight month of revenue decline for Macau casinos and the prospect for 2015 is looking just as bad.
November marks sixth straight month fall in Macau revenues
In November the VIP sector for Macau dropped 27% from the same period last year and even the previously expanding mass market took a steep fall of 13% from 2013 figures. Many point to the continuing anti-corruption campaign wagered by the Chinese government focussing on high level Chinese officials which is damaging the VIP market in Macau.
The falling momentum being felt by the mass-market segment is expected to increase in December with the increased transit visa restrictions from December 2. The new set of visa restrictions is expected to hurt the massmarket segment even further as most gamblers use transit visas to travel to the region. According to estimates provided by Credit Suisse Group gaming revenues for December will most likely report a 26% decline from 2013 figures. For 2015 analysts believe another 6 months or more before revenues start to recover for Macau casino operators with new casino resorts coming online and possibly the end of the anti-corruption campaign on the mainland.
Casino operators feared November in Macau
was not going to break the run of falling monthly revenues and so it turned out to be fact, according to government statistics released today Macau casino revenues fell by 19.6% compared to the same period in 2013. The only bright spot was that analysts had predicted a fall of 18% to 21% so the revenue decline was on the more positive side of predictions. Revenues for the 35 casinos in Macau in November fell to 24.3 billion patacas ($3.04 billion), the sixth consecutive monthly decline, from 33.5 billion patacas a year earlier. Continued investigations into high scale corruption on the Chinese mainland along with pro-democracy protests in Hong Kong have been cited as the main reasons for the slowdown in Macau.
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With the introduction of the smoking ban last month which is reducing gamblers playing time and many moving to the VIP rooms to gamble and smoke. Also with the transit visa restrictions shortening gamblers stay on Macau is having an effect on revenues.
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InfinityGaming • ISSUE DECEMBER 2014
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GAMING NEWS
BCN World Barcelona fail to buy needed land
The deadline to acquire the land passed this week which was to cost €380 million for 500 hectares so construction could begin. The deadline on the 10th December passed with Veremonte saying they may still purchase the land but were waiting until it better knows the town-planning project’s details, which are currently being defined by the public authorities. BCN World along with lead developer Veremonte has partners involved
such as Hard Rock, Melco Entertainment and Caesars Entertainment. Now the deadline has passed the local authority that owns the land has the ability to now sell off parcels of the land putting the whole project in jeopardy. BCN World was planned to involve 6 large style casinos, mega sized hotels, shopping malls, convention centres, theatres, a stadium, theme parks, golf courses, a beach club. The project was expected to create 17,000 jobs in the construction phase (directly and indirectly) and 5,000 jobs per mega-hotel, with an investment of $6 billion. The investment was announced in September 2012 as an alternative to Sheldon Adelson’s Eurovegas project. However, in order to make it happen, significant regulatory modifications were
needed so as to adapt the urban planning of the area but also to modify essential aspects regarding taxation and gambling. Observers close to BCN World say that the whole development now looks like it will be at best shelved for future consideration but most likely will be cancelled following Veremonte stalling on purchasing the land needed. Many believed the project was too large to ever succeed especially as Spain has struggled with debt and huge un-employment, making the project viable would need a location where a large portion of the local population would use the development itself.
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ajor concerns have been raised over the future of the much vaulted $6 billion BCN World project in Barcelona after the leading partner Veremonte decided not to purchase the land needed to build the huge casino resort and leisure complex.
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ARTICLE
The World Has Changed & Casinos Need the Competitive Advantage of Real-Time Customer Feedback By Martin R. Baird
Our feature writer Martin Baird in his December article takes a look at why casinos need competitive real-time customer feedback and what the dangers are if we don’t.
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casino resort customer checks into his hotel room and discovers that it’s not quite as clean as he would like. After that unhappy surprise, he goes to the spa to relax and his experience there is underwhelming. He could have received better service at a spa close to home 1,500 miles away. Another guest goes to the restaurant and the mediumrare steak she orders is served up well done and tough. Another guest drives up to valet service and it is painfully obvious the only thing the bored staff there cares about is tips.
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These kinds of problems happen at casinos all the time and for decades many of them have gotten away with it. In other words, they have survived in spite of themselves. But times have changed. REALLY changed. Thanks to the Internet and social media, casinos will suffer greatly if they don’t get a handle on the quality of their service. And they need to do it in real time.
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What am I talking about? Let’s take the examples of poor service outlined above. It wasn’t so long ago that those customers had limited options in how they could respond. They could complain to a supervisor or put up with the situation and choose to patronize a different property for their next outing. Today, those customers have the world at their fingertips and they are talking very loudly to other people who are potential customers.
The guest who discovered a dirty room sits down on the bed, opens the Twitter app on his smartphone and within seconds tells thousands of people what he just experienced. He posts an uncomplimentary Facebook status update before he even leaves the spa. The customer who could barely cut her overdone steak posts a negative review of the restaurant on Yelp while she is still sitting at the table. Casinos simply must get ahead of these problems by using the same technology to collect real-time customer feedback. Without it, they are at a competitive disadvantage. Unhappy guests should be able to use their smartphones, for example, to communicate how they feel to management first and the world second. After expressing their dissatisfaction to the property, perhaps they won’t even need to turn to Twitter, Facebook or Yelp. A problem could be resolved before a guest leaves the property. Yes, the customer’s room should have been sparkling clean when he walked in, but a quick resolution, well, that’s impressive! Possibly impressive enough that he will make a reservation at that casino resort again in the future. Real-time feedback offers other benefits, including increased guest retention and repeat purchases, improved guest satisfaction, long-term customer relationships and positive word-of-mouth advertising.
ARTICLE
resorts need now. Having that capability shows that the property is caring and innovative. But more important, it allows customers to tell a property how they feel about their experience as they feel it. This can turn the tables and put Twitter, Facebook and Yelp at a disadvantage while giving you the opportunity to make things right with your customers, improve your service and set the stage for future success.
Martin R. Baird Bio
As far as surveys are concerned, many of the ones I have received from casinos are too long. They ask way too many questions. Most people will not take the time to fill them out because they simply don’t have the time.
Martin R. Baird is chief executive officer of Robinson & Associ-
Many casinos and resorts use mystery shoppers to collect feedback and they serve a very valuable role. But mystery shoppers are not real customers and they are not spending their own hard-earned money. Shoppers can evaluate how well employees meet specific performance standards, but they can’t explain what real customers think and feel.
leader in casino guest experience measurement, manage-
Real-time customer feedback is what casinos and casino
ates, Inc., a Boise, Idaho-based consulting firm to the global
Or Read on App Store growth and profitability. Robinson & Associates is the world
gaming industry that is dedicated to helping casinos improve their guest service so they can compete and generate future
ment and improvement. For more information, visit the company’s Web sites at http://casinocustomerservice.com and www.advocatedevelopmentsystem.com or contact the company at 208-991-2037. Robinson & Associates is a member of the Casino Management Association and an associate member of the National Indian Gaming Association.
BUSINESSMAG • ISSUE DECEMBER 2014
I can hear you now: “We’re fine because we use comment cards, surveys and mystery shoppers. We’ve got it covered.” First, comment cards. Comment cards are useless and old school. They’re also expensive to print, mail and tabulate. It can take days or weeks to glean important information and by that time, service recovery is almost impossible. Comment cards have a very low response rate from mostly “lovers” and “haters,” people who either think your casino is the most exciting place in the world or the worst. What about the thousands of customers who fall between those extremes and never pass along their thoughts? They matter.
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GAMING NEWS
Polish government threaten online gamblers
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he Polish government has issued a warning to online gamblers in the country that they could be prosecuted should they play online using offshore unregulated online operators. The announcement by the government is the first ever move to prosecute players instead of operators for unlicensed online gambling. A statement on the website of the Ministry of Finance’s website says
it has proof of more than 24,000 gamblers playing online within the country using unlicensed online gambling sites from outside the country. It also says they have started criminal investigations against some 1,100 players. Polish gambling law states that any online operator wishing to offer services in the country must have their servers based in the country and have to carry the domain ending .pl.
It also states that all money transactions would have to run exclusively through Polish banks, with the tax rate was set at 12% for operators. There have been many objections to the Polish regulations and the government has said it will consider in the future that operators only need to have a local branch not all the servers based in the country.
Stewart-Jones announced as Deputy Chairman of Playtech
H
ilary Stewart-Jones has been appointed as the new Deputy Chairman of online gaming industry supplier Playtech with immediate effect. The company announced today that Ms Stewart-Jones whose background is in the legal area of online gambling where she is a partner of DLA piper law firm and previously held the role of Head of Legal at Ladbrokes, she joined the Playtech
board back in 2013 as a non-executive director. “Since her appointment, Hilary has made a significant contribution to the company’s board through her extensive knowledge of the gambling industry. On behalf of the Board, I am delighted that Hilary has agreed to become my deputy,” Alan Jackson, non-executive chairman of Playtech, said.
A third consecutive month of revenue declines were announced for Nevada casinos for October from the state regulator were disclosed this week, overall casinos won $913.6 million which also represents a 4.26% fall from October last year. For the full year Nevada has suffered a fall in total revenues of 3.29%. On the main Las Vegas Strip, which accounts for more than half of the state’s total, revenue fell by 5.63% from last year to $520.3 million. Baccarat revenues which accounts for the large majority of the state’s business dropped 35.51% to $97.3 million.
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Nevada suffers third monthly revenue drop
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GAMING NEWS
South Korea integrated resort open in 2017
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he first casino integrated resort in South Korea will be open by March 2017 according to the owners after the ground breaking ceremony took place this week. Paradise Sega Sammy – will cost US$1.7bn to build and will have a casino, hotel, spa and a theme park project say the owners. Developed in partnership with Japanese entertainment company Sega Sammy Holdings and Korean casino operator Paradise Group, the resort
will cater to both business visitors and tourists. It will offer a five-star hotel, a foreigner-only casino, convention centre, retail, an indoor theme park, restaurants and a standalone healing spa where foreign visitors will be able to experience a Korean public bathhouse. The hotel will have over 700 bedrooms, including the most expensive having their own pools villas.
The casino which will only be for overseas visitors will also have a VIP exclusive, private casino on the hotel’s top floor. In total 330,000sq m of land is being used for the project which is being leased from Incheon International Airport for a period of 50 years, with Paradise and Sega Sammy holding a 55 per cent and 45 per cent stake in the venture respectively.
UK: Gambling Commission release annual However the biggest rise in revenues went to online gambling for the year with a rise of 22% compared to 2013, of that online casinos enjoyed a rise of 15%.
According to the report the entire gambling industry in the UK generated revenues of £6.8 billion from the period of April 2013 to March 2014, that represents a rise of £0.4 billion from last year or 6%. Of that non-online gambling figures showed that 47% of that went to casinos, bookmakers, lottery and arcades.
It was only the land based bingo sector that saw a fall in revenues for the year, but with the tax reduction for the sector many operators will be positive for 2015. The controversial Fixed Odds Betting machines (FOBTs) which are classed under B2 for betting shops saw only a small rise in revenues over the last year by £17.6 million
to £1.56 billion a rise of just 1%. The previous year the rise for 2012 to 2013 was 4%. Figures show that 102,715 people are employed in the gambling industry overall in the UK which is a drop of 5,357 from last year This is the first edition of Industry Statistics to include sales figures for the National Lottery, for which sales were £6.7bn during the period April 2013 to March 2014.
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he annual Gambling Commission report into gambling in the UK has been released for the period ending in March 2014 with some interesting figures.
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GAMING NEWS
Echo Entertainment boss questions Gold Coast & Cairns casino developments
In a recent interview he believes there is no reason to have two casino just up the road from each other in Brisbane and he also said that Hong Kong billionaire Tony Fung paid way too much to build a casino in Cairns.
a wonderful asset for the city. I just can’t believe the (Wavebreak Island) site is suitable for a casino.” “I’m not sure how sensible that would be … having two casinos right next door to each other.” Mr O’Neill said Echo was prepared to take the fight up to James Packer’s Crown Resorts in its bid to win the right to build an integrated resort at the Queens’s Wharf site.
“I do not believe there will be a second casino on the Gold Coast, based on the suitability or otherwise of the proposed site,” Mr O’Neill told an Institute of Company Directors lunch on the Gold Coast yesterday.
“It’s a contest. We are of course intensely interested in being the winner,” he said.
“I don’t have any inside knowledge (of the ASF proposal) but I have reasonably good contacts on the Gold Coast and I know the Broadwater is
“We do have a Plan B if we lose … but of course we’re in it to win it.
“Complacency doesn’t enter our vocabulary.
“We have a pretty elegant solution
for the Queen’s Wharf site.” Finally the boos of Echo Entertainment focussed on Tony Fung and questioned the $8.15 billion being spent to build a casino in Cairns. Indeed his concerns on the price seemed to be correct as Mr Fung this week said he was shelving plans to build the resort, blaming probity delays and red tape, however he said he still had hopes the Aquis takeover of Reef Casino Trust would go ahead. “I thought it was curious than an investor would want to invest $8 billion in Cairns,” Mr O’Neill said. “It is not something Echo would do. “Would you invest $1 billion? Maybe. For $8 billion, you’d need a lot of things to go right.”
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J
ohn O’Neill the Chairman of Echo Entertainment says he does not believe there will be a second casino built on the Gold Coast.
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EUROPEAN GAMING NEWS
Gala merge its online divisions
Following the announcement of the changes Managing Director of the Coral Interactive division John O’Reilly has decided to step down from his role but has agreed to remain with the company in a consultancy position for the next 12 months. COO of Gala Coral Andy Hornby will now assume leadership of the merged divisions along with his remit of his responsibility of Coral Retail. Carl Leaver, group CEO of Gala Coral commented: “have seen huge progress in our online businesses
over the last few years. Now is the right time to bring together our collective knowledge & experience to ensure that our brands continue to develop strongly, while at the same time putting multi-channel at the heart of what we do.
the map in the online market. Since then, with the support of a fantastic management team, we have created a valuable & fast growing business. With Coral’s online business now established it is a good time for me to hand over the reins & return to the UK”.
“John is an impressive leader who has been instrumental in reviving Coral’s fortunes online. He will be missed as a key member of our senior executive team, but I am delighted not to be losing him completely. The combination of talent in the restructured Interactive management team puts us in great shape for the next phase of our growth.” O’Reilly said of his decision to step down: “I joined Gala Coral Group in 2011 to put Coral back on
Andy Hornby
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t has been announced that Gala Interactive and Coral Interactive will now been merged under one name and management team. The owning company Gala Coral Group said that the combined businesses will work closely with the companies retail business in order to take advantage of continued multi-channel growth.
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Feature writer - Andrew Tottenham
We Need To Talk About Money Laundering
Andrew Tottenham Our new feature writer Andrew Tottenham takes the delicate path of discussing money laundering and why so many within the industry want to avoid the topic.
I have been involved with the gambling industry since before the internet was born. My consulting career, which began in the 1980s, has taken me to many countries around the world , which has enabled me to learn about the vast cultural and regulatory differences surrounding the gaming industry – in all its forms, including casinos, slot machine halls, VLTs, lotteries and remote gambling - in all of these different places. Through this series of occasional articles for the Infinity Gaming Magazine I will be putting pen to paper (finger to keyboard) and writing about my experiences, knowledge and thoughts developed during more than thirty years in this industry.
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he European Commission’s 3rd Anti Money Laundering Directive was passed in 2005 and we now have a proposal for a 4th one (AMLD4). This Directive could have a big impact on the casino and other gaming operations in Europe but I question whether it will be effective in reducing money laundering. Before going into some of the detail of the new proposals it is worth understanding what money laundering is, the history of the directive and what is driving the need to make changes. To put it simply money laundering is taking untaxed/ undeclared money (usually the proceeds of criminal activity) and making it disappear and reappear, usually somewhere else, as perfectly legitimate. There is a whole industry that has grown up around this involving corrupt lawyers, accountants and bankers.
The 3rd AML Directive was based upon the recommendations of the Financial Action Task Force (FATF), an intergovernmental body created in 1989 to combat money laundering and terrorist financing. Amongst the gambling industry FATF singled out casinos as places where money laundering could take place and recommended that any person transacting more than $3,000 should be identified. The initial proposal from the Commission for the 3rd AML Directive contained language that Government licensed casino operators had to either identify and verify the identity of people at the point of entry to the casino or carry out the same procedure when the player reached a transaction threshold of €1,000; both buy in or cash out. There is also the obligation to report suspicious transactions. It is rather amusing when you read the preamble to the 3rd directive and it says, “Massive flows of dirty money can damage the stability and reputation of the financial
Feature writer - Andrew Tottenham
We Need To Talk About Money Laundering
I was consulting for a large US casino group at the time the 3rd Directive was proposed and we thought the €1,000 threshold to be ridiculously low; creating work with no apparent value. So I embarked on a series of meetings within the Commission, other European institutions and national bodies responsible for AML to try to convince them otherwise. My meetings with the officials from the department at the Commission that was responsible for the Directive was laughable. Firstly, when asked why €1,000 was chosen as the correct threshold they said it was because “casinos deal in cash and it seemed like the right number”! Now that is a good example of evidence based policy if ever I saw one. Then when asked why other forms of gambling, such as betting had been left out they were shocked. They had not realised that there was a legal distinction between betting and gaming and betting was not included despite the fact that it would be easy to launder money in a retail betting shop; most have little supervision and a punter could place approximately €5,000 bet on each side of a tennis match, each bet being placed in different shops owned by different companies. One bet would lose the other would win, the punter would take the cash and a receipt – voila, clean money – on average only losing the bookies’ margin. The officials had not appreciated this when drafting the directive but it was too late.
When we met with European politicians and Country Representatives they tended to agree that a €1,000 cash transaction threshold was too low and could agree to a threshold of €3,000. One Representative said that it was obviously too low, “I often take more than €1,000 in cash on Saturdays to do the weekly shopping”! Perhaps we pay our European officials too much. In the end there was considerable support for a €3,000 threshold with only the French publicly holding out for €1,000. Getting the Directive agreed was a priority and as is usual in within the EU final agreement requires horse-trading. They split the difference and settled for €2,000. We succeeded in convincing quite a few people that the transaction threshold should be only for cash out and not for total buy ins too; losing money is not laundering money. Unfortunately, law enforcement saw things a little differently. In Europe, law enforcement officials believe spending undeclared/untaxed money is laundering and a crime and it is the operators responsibility to report a crime if they believe one is being carried out. I remember a discussion at the time with a British policeman who said that it was important to have the threshold on buy-ins too because they wanted to know who was spending the money; it might be from the proceeds of crime. He then asked me if I could prove that a £5 note in my pocket had not, at some point, been the proceeds of crime! If we are really going that far then we have certainly lost the battle.
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sector….” It seems to me that bankers need no help on that score!
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Feature writer - Andrew Tottenham
We Need To Talk About Money Laundering
You would have thought with all this focus and effort the amount of money laundered in the world would be getting smaller but it is not. At a conference in 2013, organised to discuss AMLD 4, the then Commissioner, Michel Barnier, stated that since AMLD3 was passed in 2005 things have gotten worse with over €2,000 billion laundered in 2009, approximately 3.6% of the world’s GDP. It is estimated that about 75% of this comes from “white collar” crime. Jeremy Carver, from Transparency International, at the same conference said that the City of London, as the largest money market in the world is where the largest amount of money is laundered and if we want to get serious about this we should be focussing our AML efforts and resources on the world’s primary money markets. His company believes that 80% of all money is laundered through banks and other institutions. FATF, having given British banks a clean bill of health in 2007 revised their findings in 2011 and said that there was a “woeful and total abdication” by the UK banks with regard to policing money laundering. AMLD 4 is supposed to take a risk based approach rather than a rules based approach and it will be up to each Member State to implement the directive according to the risks each State perceives in their particular industry sector. This means that based on the risk assessed a rules based approach will be implemented – not much different then. It is proposed that betting and other
forms of gambling be included this time around and there has been some consultation around the transaction threshold. The French, now joined by the Italians, arguing for the €1,000 transaction threshold. Other countries are not too concerned whether it should increase, remain the same or be reduced. When AMLD 4 is adopted gambling operators will no longer be able to rely upon identifying their customers at the point of entry but will have to identify them (and so keep a record) when they hit the transaction threshold and record what efforts they took to verify the identity. The effort that the operator will have to make to verify the identity of the player will depend upon the approach each country takes and that depends on the country’s risk assessment. The requirement to identify and verify the identity of a customer could be a significant operational problem and one that will lead to masses of data being collected with no apparent value. There must be rooms full of suspicious transaction reports and they will be joined by mountains of records of the identity (and what was done to verify the identity) of customers who hit the threshold. The lower the threshold the more records and the more noise they will contain. I, like Jeremy Carver can’t help thinking that we cannot see the wood for the trees. Yes, it might be true that we read reports of a drug dealer who goes to a casino and loses money but it is rarely with the intent to launder money, it is with the same intent that he might go to a restaurant or a cinema – for entertainment. Laundering money (and I mean in the real sense) in large, wellmanaged and regulated casinos, where most transactions are recorded on cctv are not the places where it happens – it is too risky for the launderer. If we are going to focus on the gambling industry then the real emphasis should be on beneficial ownership. Who are the real owners? Just as with off-shore banks if I were a criminal who needed to launder my ill-gotten gains, I would own a relatively small casino or bank in a country where licensing is easy and ownership opaque and use it to make my money clean. But that would fly in the face of political reality.
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US took a different position; casinos are considered to be “financial institutions” and they only required identification when a player cashed out more than $10,000 on the basis that losing money was not laundering money but there is still the requirement to report suspicious transactions. After years of inactivity the US Department of Justice has started to investigate US casinos and last year Las Vegas Sands agreed to pay $47 million to the to settle what could have become a criminal suit for failing to report suspicious transactions totalling almost $45 million from one player. The player in question transferred large sums from many different places throughout Mexico; money that the US Department of Justice said was the proceeds of drug trafficking.
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INFORMATION
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