The Winds of Change – It is Time

Terry Watanabe, who faces 16 years in prison after running up $125  million in gambling debts at Las Vegas tables.

Terry Watanabe, who faced 16 years in prison after running up $125 million in gambling debts at Las Vegas tables.
Last week Terrence Watanabe and Harrah’s casino agreed to a settlement, but we don’t know what the terms were.  Harrah’s had claimed Watanabe owed it $14.7 million, Watanabe claimed Harrah’s had plied him with drink, drugs, excitement and dealt him too many cards, in fact his lawyers claim he had lost a total of $147 million, most under the influence of something; something at Harrah’s employees provided.
Nevada law allows for criminal prosecution of unpaid gambling debts and Watanabe was being prosecuted. But with the settlement, the district attorney in Las Vegas also dropped his criminal case against Watanabe.  The case does not end there, the Nevada Gaming Control Board has not dropped its investigation into the allegations against the casino company.  The allegations if proven could threaten Harrah’s license, at least in the two properties involved; the is of course the possibility that it could be proven that higher levels of management of Harrah’s were aware of the situation and then things get really serious. It is a very, very serious situation for the state of Nevada and for Harrah’s.  Harrah’s is the largest gaming company in the world and the largest in Nevada – revoking its license would have huge implications for an already cash strapped state and of course have a dramatic impact on the finance of the company.  Not taking serious action if the allegations prove to be founded in fact would have implications just as serious for the state’s regulatory structure and ability to regulate the really large casinos.

Professor Bill Thompson from UNLV, in an interview with the Las Vegas Review-Journal, said he thought it was time to regulate drinking in casinos. He says this case demonstrates what we already know about drinking and driving, you simply cannot make good decisions when impaired by alcohol.

There are two related stories that I think add to the need to rethink some fundamental things in gaming. Again in Nevada the gaming board is reviewing an application to allow ATM machines to process “slot tickets” directly.  That is you could cash out on an ATM, but you could also take money directly from your account and put it onto a slot ticket to then be inserted into a slot machine – eliminating cash; that means eliminating cash handling for the casino, but it also means eliminating cash-consciousness from the player.  The play would then never see real cash and be without the associated awareness of handling and spending actual dollars.  The vendor claims it is simply a new and more efficient use of technology.  I suggest it is a step too far into technology and one that obscures the an important underlying fact.  Gambling is wagering – you put your money against the house’s money.  If you lose, you lose real dollars – your money, not tickets, not play money and it is not like playing monopoly.

The final story comes from Michigan where a lawmaker has introduced legislation to extend the state’s indoor smoking ban to include casinos.  Casinos were successful in fighting previous legislation to gain an exception for casinos.  The gaming industry has fought smoking restrictions for years, there is no doubt, at least in my mind, that banning smoking does cause financial harm to a casino. A more important question might be; does that outweigh the physical harm cigarette smoke does to the lungs of people that inhale it?  Drinking, smoking and easy cash have certainly helped to build the casino industry, but maybe it is time we rethought each of them and start to work on a sustainable industry, one that does not exploit or harm its customers, but rather provides them with entertainment, while allowing them to retain full control of their senses and abilities.


1 Response to “The Winds of Change – It is Time”

  1. 1 Melissa Rinchiuso July 10, 2010 at 10:11 pm

    I agree that at first they would lose money with bans on smoking and regulations on drinking. But in the long run their customers will be in better situations that will allow them to be around longer and therefore gamble longer. They also could pick those that have avoided casinos because of smoking. I live in Illinois, where there are smoking bans for almost all indoor public places, and the bars went on and on about how much it would hurt them to ban smoking. I have talked to several bar owners that have said that yes at first there was a drop in business but it all came back. Because drinkers will always come back to the bar to drink just like gamblers will return to the casinos.

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