The Star Sydney’s parent company and one of the largest entertainment and gaming groups in Australia, Star Entertainment Group, was involved in a scandal related to alleged breaches of regulations related to anti-money laundering and other issues. As the second inquiry into The Star Sydney loomed, allegations of records falsification emerged earlier this week.

The allegations came after Liquor & Gaming NSW uncovered discrepancies between actual data from The Star Sydney and recorded and submitted gaming interactions by the venue. The probe uncovered that while the casino posted reports about its gambling interactions, CCTV and observations did not match with the reported actions to protect the consumers from excessive gambling.

Nicholas Weeks, the person appointed to the role of manager at The Star Sydney to help guide the venue to compliance, revealed that the Liquor & Gaming NSW inspectors compared recorded player protection data to actual CCTV footage and in-person observations, finding a mismatch between the information. As a result, the casino was accused of “falsification of records,” which occurred not only often but involved a large portion of the employees.

The latest hearing uncovered another major concern regarding The Star Sydney’s “ticket in, cash out”(TICO) machines. An issue with a software update on some of the machines cost the casino AU$3.2 million ($2.1 million) and according to a newly released report, people involved in the activity were reported to the police by the casino for fraud.

More than 40 people exploited the faulty TICO machines at the casino before the error was finally fixed nearly two weeks later. As announced by the Sydney Morning Herald, people who participated in the illicit activity are now facing legal repercussions as they were reported for fraud to the police by The Star Sydney.

The fraudulent activity wasn’t elaborate at all and was in fact caused by a glitch in the TICO machines’ software. Whenever a person placed two tickets into such a machine, they would receive the payout of the two tickets, but one of them would be returned to the customer. Subsequent attempts to redeem the returned ticket were successful and many people started doing so. To make matters worse, the ticket could’ve been redeemed multiple times, which is why the gambling operator lost millions after only 13 days.

The latest report told the story of a woman with the initials T.L.L., who was a recovering gambling addict. After hearing about the TICO glitch at The Star Sydney, she started to withdraw money using the same method. Overall, T.L.L. withdrew AU$57,265 ($36,900) and from that total, she spent everything but AU$5,000 ($3,200).

The TICO machine error happened last summer. Once the casino realized there was an issue, it reported the customers’ activities to the police. As a result, T.L.L. and many others were arrested and charged with fraud.

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Former Malta Prime Minister Joseph Muscat is at the center of yet another scandal after a media report claims he has been given an €11,800 ($12,300) monthly consultancy contract from a company linked with the Dragonara casino boss.

Exotic Bird Company Used as a Front?

Muscat started receiving the lucrative monthly payments as part of a €141,600 ($151,500) annual consultancy contract with an exotic bird company owned by casino tycoon Johann Schembri just nine months after the property lease deal for the casino owned by Schembri was extended, reported Times of Malta.

Muscat, who had to step down as Prime Minister in January 2020, following allegations of protecting people involved with the murder of journalist Daphne Caruana Galizia in 2017, was responsible for overseeing the deal which slashed the annual ground rent payments and extended the property lease for the prime St Julian’s site by 64 years without a public tender, saving millions for the casino.

According to documents obtained by the media, in April 2020, just three months after Muscat resigned as Prime Minister and while still a member of the parliament, he began receiving monthly payments from Organicum, a company owned by Dragonara casino managing director and shareholder Johann Schembri.

Financial documents reveal that Organicum deals with breeding exotic birds and making organic produce, has biological assets worth €100,000 ($107,000), employs just two people, and has declared hundreds of thousands of losses in 2020 and 2021, raising concerns about Muscat’s lucrative consultancy contract.

Both Parties Deny Any Wrongdoings

Contacted for comments, the former prime minister denied any wrongdoings but refused to comment on the consultancy agreement, and instead, chose to attack the media for being “hell-bent on characterizing legitimate and documented work” he does “as in some way untoward.”

Schembri defended the consultancy contract, claiming that it is unrelated to the Dragonara casino deal and “any statement, suggestion or inference to the contrary is refuted as entirely untrue, incorrect and purely speculative” and that the company holding the casino concession, Dragonara Gaming Limited, “has never paid any consultancy fees to Dr. Joseph Muscat.”

Muscat is also involved in a corruption probe into another monthly consultancy contract worth €15,000 ($16,050) with a Swiss company, Accutor AG,  which was allegedly used as a front to pass on kickbacks from the acquisition deal for Vitals hospitals by Steward Healthcare Malta in 2018.

Casino tycoon Schembri is a major player in the gambling sector of the island country. Last year, his umbrella company, IZI Group, was awarded the running of the national lottery.

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2022 was a very good year for commercial casinos in the US. Gamblers left a total of $60.4 billion in the machines and on the tables giving the house edge its best year ever.

On Wednesday, the American Gaming Association’s (AGA) Commercial Gaming Revenue Tracker showed that land-based gambling accounted for about 80% of the win with online casinos and internet sportsbetting picking up the other roughly 20% of last year’s revenue.

On a nationwide basis, online revenues in America lag behind many European markets. The U.K. is out front with 65% of revenues coming from iGaming, France at about 29%, and Germany at roughly 28%. Drawing in from the U.S. macro to the four states that offer commercial gaming on land and online, online revenues averaged 40.7 percent of the totals.

Regulated U.S. commercial online casino revenue grew to about $5 billion – an increase of 35.2%. Six states currently offer internet casino gambling: Delaware, Michigan, New Jersey, Pennsylvania, Connecticut, and West Virginia. New bills are moving through the legislative process in five more states to legalize online gambling. Those states are Illinois, Indiana, Maryland, New Hampshire, and New York.

US Commercial Casinos Won over $60 Billion in 2022

The more than $60 billion casinos won last year is almost 14% more than 2021 totals.

Tribal casinos and state lotteries report their numbers separately, but if fourth-quarter and full-year numbers hold up for tribal operators it could push the total for the US industry past $100 billion, a new record of its own if that occurs. The National Indian Gaming Commission will release its 2022 revenue report later this year.

According to an Associated Press report by Wayne Parry in the Concord Courier, AGA vice president David Forman said that number would put the American gambling industry revenue about on par with U.S. revenues from the sale of beer.

Bill Miller, the association’s president, and CEO said: “Our industry significantly outpaced expectations in 2022. Simply put, American adults are choosing casino gaming for entertainment in record numbers, benefiting communities and taking market share from the predatory, illegal marketplace.”

VP Forman added: “That growth is almost the equivalent of adding another Las Vegas Strip to the U.S. market.”

While Chicago, the Mississippi Gulf coast, and Baltimore-Washington, D.C. markets also produce healthy revenues, the Las Vegas Strip and Atlantic City reign supreme as the top-performing U.S. gambling markets.

Although Nevada lawmakers legalized online casino gambling about the same time New Jersey did, regulators have purposefully neglected to enact a regulatory framework for them, instead opting to only regulate sports betting and poker online.

How the States Stacked Up

That may be the reason online sportsbetting and iGaming numbers are not reported in the AGA tracker rankings when including the legacy Las Vegas Strip and other Nevada markets.

Ranked from 10 through 1, along with their take we find the following:

• Boulder Strip in Nevada ($966 million +/- = to last year)
• St. Louis market spanning parts of Missouri and Illinois ($1.1 billion + 3.6%)
• Detroit ($1.3 billion – 1.4%)
• Philadelphia ($1.4 billion – 1.8%)
• New York City ($1.5 billion + 2.6%)
• Mississippi Gulf coast ($1.6 billion – 0.5%)
• Chicago region spanning parts of Illinois and Indiana ($2.1 billion + 6.1%)
• Baltimore-Washington D.C. ($2.2 billion + 8.7%)
• Atlantic City ($2.8 billion + 8.5%)
• Las Vegas Strip ($8.2 billion + 17%)

In a turn-around from historic trends, revenue from land-based gaming tables was up 13.9% while the slots take increased by 5.1%.

About one-third of the U.S. adult population made at least one visit to a casino in 2022.

Sports betting continued to grow with 36 states (and D.C.) offering legalized sports betting in 2022 and the AGA predicting that it will be available in 40 states by the end of this year.

Source: US casinos hit high mark, Concord Monitor via AP, February 18, 2023

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