Australian casino operator Crown Resorts’ senior management continues to demonstrate that they were either shockingly unaware of their VIP gambling compliance responsibilities or simply didn’t care.

The New South Wales Independent Liquor & Gaming Authority (ILGA) inquiry into Crown’s suitability to hold a state gaming license unearthed still more embarrassing revelations this week. On Thursday, it was Crown’s former CEO/chair and current director John Alexander’s turn to squirm under the spotlight.

Pressed on whether he’d seen 2015 media articles detailing China’s crackdown on international casinos attempting to lure mainland gamblers, Alexander said he couldn’t recall seeing them. Told that other Crown execs, including one board member, were aware of the dangers that ultimately led to China arresting 19 Crown staff, Alexander claimed this represented “a failure of information flow upwards.”

China allows international resort operators to promote non-gaming amenities to mainland residents but any talk of gambling is strictly off limits. Yet Crown continued to aggressively market its gaming operations to mainland high-rollers, “deliberately spitting” on Chinese authorities (in the words of a former joint venture partner).

Alexander also pleaded ignorance of Crown management telling China-based employees to tell local authorities that they were only visiting China, not working. Alexander further claimed that he didn’t inspect the legal advice Crown received until after the arrests and said former managing director Rowan Craigie had assured the board that “we were operating legally in China.”

Last year, in the wake of public reports that Crown was turning a blind eye to money laundering at Crown Melbourne’s junket-led VIP rooms, the company bought ads in local newspapers decrying the “deceitful campaign” against it. Alexander admitted Friday that some of the claims made in Crown’s ad were inaccurate.

Those claims included Crown claiming to have “robust processes” for vetting its junket partners. Alexander said one of the execs who vetted these claims for accuracy was Barry Felstead, who oversaw Crown’s VIP operations. Alexander disagreed when asked whether this was effectively asking Felstead to investigate himself.

Asked about revelations that the Suncity Group junket was running a ‘cash desk’ at Crown Melbourne, Alexander said he couldn’t recall being briefed about the AU$5.6m in cash that was found in a cupboard in Suncity’s VIP room, which was AU$5.5m higher than Suncity was legally permitted to have on hand.

Shown an email in which Crown compliance officer Joshua Preston referenced the cash, Alexander again claimed ignorance, while admitting that the email should have been forwarded to Crown’s risk-management committee. Alexander conceded that this made it “more difficult” to deny the suggestion that Crown had turned a blind eye to money laundering.   

Last week, Crown suspended junket activity at its casinos until mid-2021, and Alexander claimed Friday that the company was on “a journey of improvement.” ILGA commissioner Patricia Bergin claimed to be “at a loss” with Alexander’s sunny views, musing that if Crown could claim ignorance of illegality at its venues, “what chance has the regulator got?”

The ILGA has been tasked with determining whether Crown is suitable to hold a gaming license for its AU$2b Crown Sydney property, which is scheduled to open this December. Speculation has it that Crown will escape an outright revocation of its license, but will face tighter restrictions on its ability to operate gambling at Crown Sydney.

Crown’s largest shareholder James Packer, whose efforts to sell 20% of Crown to his former JV partner Lawrence Ho sparked the inquiry, is scheduled to testify via video link next Tuesday (6).

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Online gambling operator 888 Holdings has indicated interest in buying William Hill’s non-US operations if Caesars Entertainment Inc.’s £2.9 billion offer to buy the British bookmaker gains shareholder blessing.

888 CEO Itai Pazner said this week that the company is “in a good position to make acquisitions” and that a bid for William Hill’s non-US assets “could potentially be something for us.”

Mr. Pazner’s comments came after Caesars tabled its takeover offer on Monday and William Hill’s Board of Directors said on Wednesday that it recommended the deal to the company’s shareholders.

Caesars noted in its offer that it would focus primarily on William Hill’s US assets and would look for “suitable partners or owners” for the bookmaker’s UK and European businesses.

William Hill entered the US in 2012 when sports betting was limited primarily to Nevada. Following the strikedown of the long-standing federal ban on athletic gambling, the British company landed a major partnership with Eldorado Resorts to become its exclusive sportsbook partner.

Eldorado and Caesars combined earlier this year and the enlarged group inherited that partnership. As part of that previous deal, Caesars owns a 20% stake in William Hill’s US business.

William Hill runs 1,400 retail betting shops in the UK and provides online gambling services in its domestic market as well as in Spain, Italy, and Sweden.

888 Interested in William Hill’s Digital Business

888 is an online-only gambling company and it probably has little interest in William Hill’s retail betting estate in the UK.

Mr. Pazner said that while it is too early to say what they might do, they are “following what’s happening very closely.” He noted further that they are “going to look at any asset that can be relevant for us, and within that list, if that opportunity [to purchase William Hill’s non-US operations]

comes our way that could be relevant for us.”

William Hill and 888 discussed a possible combination twice in the past. In early 2015, William Hill made an offer to acquire 888 in a deal that valued the latter at £700 million. Takeover talks fell through after one of 888’s biggest investors asked for a higher offer.

In 2016, 888 teamed up with The Rank Group to make an offer for William Hill, but that combination never happened, as well.

While 888 is probably eyeing William Hill’s online gambling operations, Betfred has interest in the company’s betting shop portfolio. Asked whether 888 would consider offloading the betting shops to Betfred if it buys William Hill, Mr. Pazner said that “that could be a potential move but these are all theoretical scenarios.”

It also became known that William Hill’s top executives, CEO Ulrik Bengtsson and CFO Matt Ashley, will receive cash payments of up to £2.1 million if they stay with the company until Caesars sells “all or substantially all” assets of the bookmaker’s non-US business.

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B2B gambling companies Scientific Games and NetEnt announced that they have teamed up in a bid to strengthen their presence in the regulated US gaming market.

Scientific Games said Thursday that it has reached an agreement with the Swedish slots maker to distribute its content across states where online casino-style gaming is legal via its OpenGaming aggregation platform.

Scientific Games’ OpenGaming platform offers more than 2,500 games, including proprietary titles and content from a wide range of third-party studios. The content aggregation solution also offers different features such as jackpots, missions and tournaments, and free spins, among others.

Under their recent partnership, a selection of NetEnt’s most popular games have been integrated onto OpenGaming and are now available to platform partners in New Jersey. Further launches in Michigan and Pennsylvania are planned to follow.

The addition of NetEnt’s portfolio, including Divine Fortune, which has been an absolute hit in the US, as well as the likes of Starburst and Gonzo’s Quest, will further strengthen OpenGaming’s offering and marks a significant milestone in Scientific Games’ plan to build one of the industry’s largest and most powerful content aggregation platforms.

The partnership between NetEnt and Scientific Games comes as the Swedish games maker is looking to expand and cement its presence in the fast-growing regulated US market. Most recently, NetEnt announced that it has extended its foothold in Pennsylvania with the launch of a selection of its slots with Wind Creek Casino.

The Swedish company also unveiled a partnership with BetMGM to enter the West Virginia iGaming space.

US Expansion of High Importance

Commenting on their partnership with Scientific Games, Brian Kraft, VP Commercial at NetEnt Americas LLC, said that expanding their presence in the US market is of high importance to them and that their collaboration with Scientific Games to leverage the power of OpenGaming “made strategic sense” for them, given the company’s strong reputation and multiple partnerships in that market.

Dylan Slaney, SVP Casino for SG Digital, added that this recent strategic partnership is “highly beneficial” for both Scientific Games and NetEnt and that together, they are “in a strong position to make further inroads into the US iGaming market and deliver outstanding content to more players across multiple states.”

Mr. Slaney went on to say that NetEnt’s games need no introduction and that they are confident their operator partners in the US will “appreciate the high-quality gameplay” the games maker offers.

The Scientific Games official also noted that their vision for OpenGaming has always be for it to be an aggregation platform “at scale” with features that work across different studios in every regulated online gaming market.

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Global payments company Paysafe has extended a long-standing partnership between its Skrill digital wallet and Betfred to now include the UK bookmaker’s Betfred USA Sports subsidiary.

As part of a recently signed agreement between Betfred and Skrill, which builds on their previous collaboration, the sports betting operator has added the digital wallet as an available payment method to Betfred USA’s recently launched online and mobile sportsbook in Iowa.

The deal between Skrill and Betfred is the latest in a series of milestones the digital wallet has reached this year as part of its US expansion effort. The partnership with the major gambling operator, which too has been looking to strengthen its position in the growing US wagering space, follows the recent launches of the Skrill Visa Prepaid Card in the US market, the Skrill Money Transfer solution and the Skrill Knect loyalty program.

Skrill noted that it has now been focusing its attention on cementing itself in the US to respond to a growing consumer demand for digital wallets. According to a recent Paysafe report, more than a third of Americans (around 36%) used digital wallets at least monthly during the second quarter of the year.

Building on Long-Standing Partnership

Skrill has been serving Betfred’s European sportsbook operations since 2006 and the digital wallet’s recent agreement with the bookmaker builds on an already strong relationship.

As part of this extended collaboration, Betfred’s customers in Iowa will be able to upload funds to their Skrill account via a number of different options, including bank and card transfer, iACH, and eCash solutions, and use the digital wallet to deposit on Betfred’s Iowa-facing online and mobile sportsbook.

Bettors can then bet on a wide range of sports, including professional and collegiate football, basketball, baseball, hockey, and soccer, among others. They can also withdraw their winnings into their Skrill accounts and transfer them to their bank accounts or withdraw them at an ATM via a Skrill Visa Prepaid Card.

Betfred entered Iowa’s sports betting market this past January when it debuted a retail sportsbook at Grand Falls Casino & Golf Resort. The sports betting operator launched its digital gambling solution in partnership with the casino earlier this month.

Commenting on their extended partnership with Skrill, Betfred USA Sports COO Bryan Bennett said that funding accounts with multiple deposit methods is what sets them apart from their competitors and that Skrill offers their customers “more flexibility by supporting popular international and local payment providers.”

Lorenzo Pellegrino, CEO of Skrill, NETELLER and Income Access at Paysafe, added that they are delighted to extend their global partnership with Betfred and support the bookmaker’s growth in Iowa and beyond. Mr. Pellegrino also noted that their Skrill solution will provide Betfred USA Sports and its customers with a payment method that “streamlines, simplifies, and ultimately improves the wagering experience.”

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Bill Pascrell III is excited by the immense possibilities of the U.S. online gambling market. The lobbyist from the Princeton Public Affairs group sat down with long-time friend Becky Liggero Fontana on the latest episode of The Long Con to talk about the state of play in the growing U.S. online gambling market.

Pascrell was quick to point out that life is slowly returning to normal for the retail sector in North America. “Restaurants are opening and casinos are opening but the online gaming world has been incredibly robust,” he said.

While sports betting related content has been down, online casino and poker content has pushed jurisdictions like New Jersey to the top of the food chain. “New Jersey’s has just become the third-largest jurisdiction in the globe which is quite an accomplishment after only six years,” Pascrell added.

The rise of New Jersey is no surprise to industry veterans like Pascrell. The online gambling industry was one industry that was able to adapt quickly to the changing business conditions brought on by the COVID-19 pandemic. As Pascrell points out “You have to be nimble and make the best chicken salad, out of chicken shit.”

Pascrell believes that the shift to online gambling for some bricks and mortar casinos has offered some unique partnership opportunities in New Jersey. “Although the casinos were shuttered and the hotels and the restaurants, they were able to realize some revenue through their partnerships with the skin partnerships with casinos,” Pascrell revealed. ”We’re excited because the NFL starts back up and now we have baseball, hockey, basketball and golf all at the same time was and that provides other opportunities.”

While sports betting has experienced explosive growth, Pascrell believes that strong regulations have laid a positive foundation for market opportunities. “We have survived we’re now in our seventh year of online in new jersey without any major scandal or story about anti-money laundering or age verification or geo-locationing,” Pascrell added.

The strict push for responsible online gambling in America has been one of the major reasons behind its successful growth according to Pascrell. “The national blocking lists have all been very extraordinarily successful and now when you’re looking at advertising whether it’s in Pennsylvania or new jersey or Colorado every ad has a responsible gaming piece where you can call up or self-block or put blocking software or bank blocking and I think the biggest challenge we have now is content.”

For any new operator considering entry into the U.S. market, Pascrell believes a New Jersey license is a must-have. “I like to say use new jersey as a trampoline effect to spring into the market,” he said. “If you can get a license in New Jersey which is very hard to get because we have a limited number of skins, we have a very robust regulatory market and they’re not allowing dodgy players who might have had issues with black markets and AML and other issues.”

“Essentially so if you succeed and get a license in Jersey and launch it will be relatively seamless and easy to get a license in any other jurisdiction whether it be Pennsylvania, Michigan, Indiana, Illinois, West Virginia, North Carolina which is coming online soon,” he added.

The tough regulatory framework has helped make New Jersey one of the hubs for the online gambling business in the U.S. and a license in Jersey can open doors to the rest of the market. “Jersey has high regard all of those jurisdictions throughout the U.S. respect the Jersey licensing process to suitability the investigations and for that matter even parts of the rest of the globe respect New Jersey,” Pascrell said. 

In the full episode, Pascrell advises on what new operators need to address when entering the New Jersey regulatory market. Don’t forget to subscribe to the CalvinAyre.com YouTube channel to see The Long Con each and every Monday.

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