Reported by Howard Stutz

By 2007, as casino expansion flourished across multiple states, the U.S. Department of Treasury stepped up its scrutiny of large financial transactions at casinos. Nevada gaming overseers decided a change was needed in the state’s regulatory structure and removed Regulation 6A, which covered currency reporting requirements by casinos.

It essentially led to a role reversal for the Nevada Gaming Control Board and gave federal investigators the first crack in scrutinizing six-figure and seven-figure cash transactions inside the state’s casinos.

Seventeen years later, this change is the reason Nevada regulators are following federal prosecutors in disciplining disgraced casino executive Scott Sibella, who escaped a prison sentence last week through a guilty plea in federal court after allowing an illegal sports bookie to gamble $120,000 in unreported cash at the MGM Grand Las Vegas in 2017, violating federal anti-money laundering rules.

To some, the federal charges and Sibella’s acceptance of a year’s federal probation and a $9,500 fine have brought the issue and Nevada’s ‘gold standard’ in gaming industry regulation — a term often used by industry regulators, state lawmakers and gaming license holders to describe Nevada’s decadeslong dominance as the center for legal gaming — to a head.

“We gave up our regulatory authority,” said a former gaming regulator, one of several casino industry insiders who were granted anonymity to speak freely to The Nevada Independentbecause they are either licensees or regularly appear in front of state gaming regulators.

“The Treasury Department is very tight-lipped on these investigations,” the source said.

It’s unclear exactly when the control board learned about the federal investigation into Sibella. Sources said board members were unaware of any investigation when Sibella was licensed in March 2022 as president of Resorts World Las Vegas.

On April 30 — more than three months after Sibella’s plea agreement with federal prosecutors was announced and some seven years after the violation occurred — Nevada gaming regulators filed a three-count complaint on the same charges against Sibella, who was fired from his role with Resorts World last September. He is expected to face a substantial fine and could see his gaming license revoked.

The control board’s handling of Sibella hasn’t sat well with many gaming industry insiders and observers, because it makes it appear that Nevada dropped the ball. 

Read full report: https://thenevadaindependent.com/article/is-nevadas-gold-standard-of-gaming-regulation-in-jeopardy-after-money-laundering-cases