Las Vegas Sun

December 9, 2018

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Regulators side with gamblers in cases of confiscated chips

Over the past few months, Nevada regulators have ordered the MGM Grand casino to pay two gamblers whose chips were confiscated by the city's biggest gambling hall after employees said they couldn't verify whether the players had won them.

The incidents, both settled out of the public eye, involve a little-known regulation intended to protect casinos against theft.

But the players, who won't reveal their identities for fear that they will be banned from casinos, say the MGM Grand used the regulation as an excuse to hassle gamblers who are skilled at blackjack.

Unlike most other casino games, blackjack is considered "beatable" for people who are good enough to track, or "count," cards.

At issue is a regulation that allows Nevada casinos to confiscate chips if the casino "knows or reasonably should know" that the person with the chips isn't a customer.

A graduate student from the South learned about that rule in January when he approached the casino cage at MGM Grand with $5,000 in chips he had won at the casino during previous trips to Las Vegas. He said he decided to cash out after spending a few days in town with his wife.

The student said he was carrying luggage and in a hurry to catch a plane. He was shocked when the cashier balked at cashing his chips.

"The (cashier said), 'We've got a record of some play but we don't see record of this kind of play,' " the man said. "They know I was a patron in the past."

In July, a software developer from New York had a similar experience when he approached the MGM Grand casino cage with $8,600 -- about $7,600 more than he had started with at the beginning of his 12-day vacation in Las Vegas.

Even though the man was a familiar blackjack player in Las Vegas, the property was unable to verify that the man had gambled at MGM Grand, according to the man's complaint.

"The casinos do not like people who win," the New York gambler said. "They like people who lose. They are just using this regulation as an excuse to cheat me."

Gaming Control Board agents sided with the gamblers in both cases.

In the case of the student, regulators said the casino should have known that the man was a customer at MGM Grand.

MGM Grand managers "stated it is quite common for players to play $500 or $1,000 chips and refuse to be rated," according to a letter from the Gaming Control Board sent to the gambler in March. "If a player walks away from a table with $500 or $1,000 chips, the casino may not ever know who they are."

MGM Grand "does not keep track of their $500 chips; therefore, they are unable to determine who has them and how many are outstanding," the letter continues.

In the case of the software developer, the Gaming Control Board was able to verify that the man had gambled at the casino.

In its defense, an MGM Grand spokeswoman said the property was simply complying with the chip-cashing regulation.

Casino management instructor Jeff Voyles, a casino manager with MGM Grand parent MGM Mirage, agrees.

Players' chips are rarely confiscated and if they are the typical outcome is that players are paid what they are owed, said Voyles, an adjunct hotel management professor at the William F. Harrah College of Hotel Administration at UNLV.

The chip cashing regulation allows casinos to "buy time" to look into discrepancies in chip count, he said. The regulation is among a host of laws and procedures cashiers must follow that include alerting bosses to big cash transactions and behavior that looks suspicious, he said.

The rules end up inconveniencing few of the multitude of players who cash out every day, he said.

"It's a verification process," he said. "The regulations sometimes look like overkill to the customer but we're talking about millions of dollars in chips (that are played) daily. There's nothing more cash intensive than this business. It's amazing to me that people aren't inconvenienced more than they are."

Casinos can immediately identify rated players -- gamblers who identify themselves to the casino and receive comps for their play -- by computer, Voyles said. But the process may take longer for unrated players, though casinos most likely keep informal records on players who are holding big chips or a lot of chips, he said.

Casinos would not use the regulation to hassle skilled blackjack players because card counters are typically identified long before they cash out their chips, Voyles said. Moreover, known card counters are often asked by casinos not to play blackjack at their properties, he said.

The chief enforcement officer of the Gaming Control Board said the resolutions of the two cases are proof that the regulations work.

"There's really no motivation for a casino not to pay a player and risk bad public relations," said Jerry Markling, the newly appointed head of enforcement. "But they do have the right to not pay if they (casinos) believe the chips were stolen."

He said players who have disputes with a casino call the Control Board with a complaint. Normally, the board will have an agent investigate the dispute and make a recommendation to the player and the casino based on the findings.

If the dispute remains unresolved, the matter can be appealed to a hearing officer who arbitrates between the casino and the player with the benefit of the board officer's investigation.

The next level of appeal is the three-member Control Board and board decisions can be further appealed to a court of law.

The report generated by the Control Board agent remains confidential through all levels of appeal with only the end result of disputes before the Control Board and commission ever reaching a public meeting.

Markling said disputes involving the cashing of chips are rare and that most arguments arise over slot machine payouts.

"Generally, a casino will have a good reason for not paying someone," Markling said. "By regulation, casinos are required to contact us if a dispute over an amount in excess of $500 exists."

If it's less than $500, casinos aren't required to report it to regulators -- but players do, and that's how investigations of complaints begin.

Markling said sometimes it takes a chip audit by a casino to clear up a dispute. He said agents normally take 30 days or less to conduct an investigation into a player dispute.

"I don't think it (disputes) is a widespread problem," Markling said. "It's one of the reasons we exist."

Al Rogers, a longtime critic of the Gaming Control Board who runs local gambling book publisher Pi Yee Press, said the incidents reveal a cozy relationship between state regulators and casinos.

In both cases gamblers who legitimately won chips were treated badly and the MGM Grand was not fined for their action, said Rogers, who once made a living playing blackjack. Such complaints are rarely publicized because they are settled or aren't appealed to a public hearing, he said. That means there's little deterrent for casinos that want to confiscate a player's chips, he said.

State law should be changed so that Gaming Control Board records of complaints and settlements are made public just like regular police records, he said.

"The law is allowing them to act with taxpayer money in secret," he said. "That's how sweetheart deals are made."

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