Nevada’s gambling regulators are quite concerned about the gambling bill (SB 346) recently passed by the State’s Senate, which contains a proposal to allow private equity firms to place bets in Nevada’s racing and sports betting arenas.
Nevada Gaming Control Board (NGCB) Chairman, A.G. Burnett, publicly expressed his disapproval over the proposed entity betting system, as he believes that group betting poses regulatory concerns that could undermine the reputation of Nevada’s gambling industry.
Aside from the usual concerns over money laundering, corrupt practices and fraudulent activities, the NGCB Chairman cited that group betting contravenes existing laws, which allow betting by individuals only.
Placing bets in behalf of a group of investors is tantamount to the prohibited “messenger betting” system, which entails paying another person to place a bet in one’s behalf.
Other potential problems perceived by the NGCB Chairman are those instances in which part of the money placed as bets by private equity firms, originated from money transferred electronically by out-of-state investors.
This could place the State of Nevada in a precarious situation, since such activities will run afoul with the Federal Wire Wager Act.
The NGCB Chairman sees the proposed bill as a gamble by itself. The state will be gambling on the possibility that out-of-state investment firms will not come to Nevada and create a firm that will manage their sports betting activities.
To which money placed as bets, could possibly include those originally placed as hedge funds or high-risk investments. Not unless, the U.S. Congress passes a law or even an official statement from the Department of Justice that it is legal to wire money to a Nevada sports betting firm.