Casino Life Issue 143 Vol 17

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CASINO The magazine for the owners and management of international casinos

Volume 17: Issue 143

WHERE INNOVATION MEETS INGENUITY Global Payments Gaming Solutions President, Christopher Justice

Contents 4 Contents Page 5 Editors Note 6 George Washington slept here The unlikely success story of Valley Forge Casino Resort. By David David McKee


14 Ocean Casino Resort Lights The Way To A New Day Terry Glebocki, CEO of Ocean Casino Resort, shares her knowledge and expertise with Casino Life. By Damien Connelly 20 Second City no longer It looks like all systems go for a Chicago casino. By David McKee 24 Covid-19. The Hospitality Industry Adapts Navigating compliance mandates while maintaining consistent guest service. By Bob Ambrose



28 Everybody’s a VIP Global Payments democratizes the high-roller experience with its VIP Mobility app. By David McKee 32 Identity Verification Jacob Sever, Co-founder & Chief Strategy Officer at chats with Peter White 36 Providing Success to Casinos Tim Kennedy, Sales Director, UK, SUZOHAPP talks to Damien Connelly 41 Gaming Legislation Update Report on Gaming Legislation in Spain, Germany and France France. By Marko Tomic, Partner, Law Firm Anđelović, Siketić & Tomić d.o.o. Zagreb 44 The Last Word

By Damien Connelly

20 Editorial Policy: The views and opinions expressed in Casino Life remain principally the views of contributors and do not necessarily reflect those of the editor or publishers. The publishers wish to avoid inaccuracies and, whilst every precaution has been taken to ensure that information contained in this publication is accurate, no liability is accepted by the editor or publishers for errors or omissions, however caused. Unless otherwise stated, articles appearing in this publication remain the copyright of the publishers and may not be reproduced in any form without the publisher’s written consent. Printed in the UK by Severn Print.

Editor’s Note

CASINO The magazine for the owners and management of international casinos

Published by Outsource Digital Media Ltd

Editorial: Editor: David McKee Features Editor: Damien Connelly Associate Editor Asia: Bill Healey Special Assignment Correspondent: Sophie Behan International Casino & Gaming Correspondent: Robert Ambrose

Production: Designer: Stewart Hyde Proof Reader: James Ball Accounts: Helen Holmes Web: Pasha Kuzminskiy Publisher: Peter White Tel: +44 (0) 1892 740869 Mob: +44 (0) 7973 273714 Volume 16: Issue 143

Welcome... Issue 143 of Casino Life. It’s been two weeks, as of this writing, since the first doses of Covid-19 vaccine were administered in the United Kingdom. In the United States, vaccines from Pfizer and Moderna have received federal approval, and are being distributed. It’s not an economic panacea and there’s a temptation among the public to let their guard down. As one careless casino customer in Atlantic City told a reporter, “We’re so over the Covid thing.” However, Big Gaming’s stocks are responding well to the news, rising exponentially faster than the S&P 500. As for keeping casinos healthy, it’s an ongoing challenge, one that University of Nevada-Las Vegas professor Bob Ambrose addresses in this month’s issue. In America, the tendency is to focus on Las Vegas, where the casino industry is on the ropes, no longer able to offer the destination-resort experience that differentiated it from, say, Philadelphia. It’s not expected to be back to normal until 2022, once people have regained confidence in traveling and in being in crowded environments. It could be worse. Officials in New York City do not expect tourism to recover to prepandemic levels until 2025. That could be grist for the mills of Genting Berhad and MGM Resorts International, which are pressing for full resortcasino status by 2023, if not sooner. But the pandemic has not been all downside for the casino industry. Players, cooped up at home, have made mobile sports betting a booming business. With Vegas largely out of the picture, American punters are having their flutter at regional casinos. Not as many players may be coming but they’re spending more when they do. One property that has benefited from these phenomena is Valley Forge Casino Resort, just across the street from George Washington’s famous rebel encampment. Sin City may be out of the picture for now but don’t discount Atlantic City, which has been recovering more rapidly than its Wild West counterpart. Last month, gaming revenues were only eight percent off pre-pandemic levels. Internet gambling and sports betting are helping power the comeback, to be sure, with i-gaming leveling the playing field among big and little casinos. But an infusion of newish product is also playing a role. The star performer in town is Ocean Casino Resort. It’s headed by one of the Boardwalk’s most astute CEOs, Terry Glabocki and our Damien Connelly sat down with her to find out what makes Ocean roll. David McKee

DMcKee Editor


Lead Feature: Valley Forge


Lead Feature: Valley Forge

George Washington slept here The unlikely success story of Valley Forge Casino Resort by David McKee

Volume 16: Issue 143


Lead Feature: Valley Forge


t first, when it opened in 2012, Valley Forge Casino Resort was just another little casino. It was the product of Pennsylvania politics that permitted smaller-scale casinos with limited access to gaming (initially), and gambling floors with only 850 slot machines and 50 table games—big by continental standards but smallish in American measurements. (Valley Forge’s casino floor is what used to be the exhibition space of the Valley Forge Convention Center, built in 1985.) The property still has convention space, currently idle, as well as two hotels which include a Radisson. Yet Boyd Gaming looked upon Valley Forge and saw potential, buying the property for $281 million in 2018 and turning it into one of the most reliable performers in the greater Philadelphia area. (George Washington’s Valley Forge encampment directly overlooks the resort.) In a further coup, Boyd partnered with FanDuel in March 2019 to provide walk-up sports betting and, four months later, online sports betting, which turned Valley Forge into the Keystone State’s sports-wagering leader, a title it is unlikely to relinquish anytime soon. As the cherry on top of the sundae, Boyd has tied Valley Forge very recently into its B Connected loyalty program, superseding the Valley Club Rewards system and greatly extending the loyalty benefits available to players. Given the terrestrial and digital success Volume 16: Issue 143

stories—and the challenges posed by Covid-19—we spent some time with General Manager David Zerfing. How important has the FanDuel sports book been to Valley Forge’s success? It’s been very important. Back in March of 2019 the sports book added an amenity to our property and it brought a new level of excitement to the casino floor. It still does today. It brings in a whole different demographic to the property and the casino, so it’s been integral to our success. When you say “a whole different demographic,” what do you mean? It’s different from what the casino’s demographic was before. It skewed a little older and the sports book skews a little younger. It’s a crowd that hadn’t visited Valley Forge before and they come in now, and they don’t just play in the sports book; they play in the casino, too. What are the advantages of being tied into FanDuel? It’s a big advantage because they are the numberone name in sports betting, so when you see or hear advertising anywhere in Pennsylvania about FanDuel it’s tied to Valley Forge. That’s a big benefit to us, keeps our name out there, keeps us top of mind. It brings 9

Lead Feature: Valley Forge

people into the property, so when people think FanDuel and sports betting, they think Valley Forge and that really helps us keep our brand out there and keep us top of mind with our customers. How much of your sports-betting business is digital as opposed to retail? We follow the state pretty closely, so we’re about 90 percent digital and 10 percent retail. How large of a sports-betting market could Pennsylvania become? 10

The sky’s the limit, in my view. Every month we’ve set a new record. We only trail Nevada and New Jersey right now but those are much more mature sportsbetting markets, especially Nevada. I believe, in time, as Pennsylvania matures we’ll be able to catch those two and the market is going to be huge. How important of a lifeline have Internet gaming and mobile sports betting been during Covidmotivated shutdowns? Well, it definitely helped while we were closed, having some income coming in, but the online casino was

Lead Feature: Valley Forge

David Zerfing GM Valley Forge Casino Resort

Pursuant to that, how have you revised your slot and table game floors? Because our floor is not as big as the others’ we’ve made some changes to get more slot machines open. But on the table side it’s basically remained the same.

just getting started at that time and there really wasn’t any online sports betting going on just then. The major sports in the U.S. were closed also. Now it definitely adds to our financial success and results but at the end of the day, our main focus here is on our guests’ safety and our team members’ safety, and the cleanliness of the floor—ensuring that people feel safe and are safe. We make sure that’s an environment that we’re supplying, so it helps us right now but our real focus is keeping everybody safe until we get through this pandemic.

Volume 16: Issue 143

What is your game capacity at present? For the most part we have every other slot machine open, which gets us to 499 slot machines that are open right now. The tables are still at 50, it’s just the number of seats per table is much less than before. We’re running basically three people per table game and six at a crap game. Has the rise in sports betting caused slot or table space to be cannibalized? It hasn’t happened here. We put our sports book in an area where a piece of it was part of our food court, so it didn’t infringe into the existing casino space. That size has fit us very well. It’s not like a Vegas sports book where people will watch games all day. It’s a lot of people coming in and going out, they make their 11

Lead Feature: Valley Forge

bets, they watch some games, they go out on the casino floor, so it works very well here and it hasn’t required us to reduce casino space at all. With pandemic restrictions, do new slot and table products have a higher bar to clear in order justify floor space? Because of the type of gaming license we have, our capacity is limited in tables and slots. We already had a really high bar in order to get a new slot product or table product onto our floor because we can’t just add more games because we’re restricted by our gaming license. We still have the same measurements. Any slot or game product is going to have to significantly grow revenue and profitability. We’ve always looked at it that way because of the style of gaming license we have here in Pennsylvania. How has the pandemic affected your slotreplacement cycle? Overall, in 2020, after we’ve reopened, the preservation of cash is the most important thing through the end of this year. As we’re looking into 2021, I think things will get back to normal, not just in slot replacement but all types of capital investment. What kind of safety measures have you put in place and which ones are likely to be permanent? 12

The overall cleanliness standards that we’ve put in place will continue. All of the extra cleaning that we do is something that makes a lot of sense. Certainly, after the pandemic is over, we’ll be opening all the slot machines and allowing people to get back to playing

Lead Feature: Valley Forge

of our hotel towers. That tower is closed at this point. When the pandemic ends and group business starts to travel again, and functions start to happen [again] then we anticipate reopening that tower and starting to sell to those people again.

all the spots on the table games. But the look of the overall cleanliness of the casino, it’s night and day with the effort of not just the crews that do that but the management team, and everybody that pitches in to help and ensure that the casino is clean and safe. How has your hotel been performing during this time? We have one of our towers open right now, the Casino Tower, and the weekends are strong, just like it was before the pandemic and sometimes slower in midweek without the groups. We had heavy group business here in the past and that really filled up one Volume 16: Issue 143

What other resort features do you have and which amenities are currently operational? We have our steakhouse open and our food court is open. The pool was closed down for the summer. Obviously it would be closed at this point in time. Also, the fitness room is not open at this point in time. All of the bars, because of the restrictions that we have, are not open either. Congratulations on joining B Connected. What does this do for your customers? It’s a big benefit. It’s definitely going to be the 600-pound gorilla here in Pennsylvania. The corporate-loyalty program is significantly better than what our competitors have. It’s very much experiential-based. Players will be able to have free trips to the Bahamas on cruises, to Las Vegas as being part of the program and their level of play. It’s a significant advantage to us because the program really gives a lot of great benefits to our customers. 13

Feature: Ocean Casino Resort

Ocean Casino Resort Lights The Way To A New Day Terry Glebocki, CEO of Ocean Casino Resort, shares her knowledge and expertise with Casino Life. By: Damien Connelly


orged in the fire of competitive survival and turnaround success, the management at Ocean Casino Resort are fully versed in overcoming challenges. Luxor Capital Group, a New Yorkbased investment management firm, acquired


the property in 2019. As noted recently by Mike Conboy, a partner at Luxor Capital, “In 2019, Ocean Casino Resort was the fastest-growing casino in Atlantic City.� Luxor Capital gained its full license to operate Ocean Casino Resort in May 2020. Since it acquired Ocean Casino Resort,

Feature: Ocean Casino Resort

Volume 16: Issue 143


Feature: Ocean Casino Resort

Luxor Capital has seen its expectations exceeded. Atlantic City is a very competitive jurisdiction for casino resorts, having nine resorts operating within three square miles of each other – six on the Boardwalk and three in the Marina District. What’s great from a business perspective is that some resorts do ‘co-opetition’ = cooperative competition, whereby the resorts work with others to help grow Atlantic City’s total market metrics. Atlantic City is a mostly locals and regionals market, with some destination elements underpinning its tourist and MICE offerings. The most recent new-build casino resort to be added to Atlantic City’s skyline – touted as the tallest building in the city with its 57 stories topping out at 710 feet (220m) – is Ocean Casino Resort. The resort had teething challenges during its first incarnation as Revel – and in truth, some of those challenges remain to be overcome. In today’s climate, what operator doesn’t face challenges? The knowledge and expertise of Terry Glebocki and her management team in making a success of a challenged resort property may help you see opportunities to survive and thrive given the challenges we all currently face. Third quarter 2020 (3Q20) industry statistics 16

emphasize the strength of Ocean Casino Resort’s human capital. Casino resorts operate in a servicedriven industry – whether it is on-ground, online, or omnichannel. Experienced and customer-focused human capital make the difference between average and great. The most recent quarterly numbers speak for themselves. Thank you for sharing your time with Casino Life and our readers, Terry. How has your career path brought you to being the CEO of Ocean Casino Resort? I’ve been in the Atlantic City casino industry for over 30 years in progressive financial leadership roles including Trump Entertainment’s senior vice president of finance, Revel’s chief financial officer and Tropicana Entertainment’s corporate CFO. I view my financial background as a strength. Casinos are big businesses with multiple disciplines and understanding the profitability of each segment is critical to the overall financial success. Net revenues for the third quarter 2020 (3Q20) for Ocean Casino Resort are only down three percent

Feature: Ocean Casino Resort compared to an Atlantic City average drop of over 30 percent and a Boardwalk drop of almost 20 percent. What’s your secret sauce? To understand our “secret sauce” you must look at the nine months prior the pandemic. In 2019, we made significant changes throughout our operation and had momentum build from June 2019 through February 2020. We had nine consecutive months of double-digit year over year gaming revenue growth. Unfortunately, the pandemic struck in mid-March causing all of the Atlantic City properties to temporarily suspend operations, which lasted 107 days. Here at Ocean, we began planning for our reopening the day we closed. We looked at literally hundreds of touch points to ensure that when we were able to reopen to the public in a safe manner. We listened to our guests, as we always do, and we were able to provide them with an environment where they could feel safe. We reopened our doors on July 2 and the momentum we worked so hard to create prepandemic was still alive. Our guests appreciate the grand scale of our property allowing them the space to be socially distanced in addition to the cleanliness associated with a newer product. We continued to give our guests many of the amenities and rewards they have become accustomed to, and all of those things allowed us to continue to grow.

Net Revenues 3Q20 Vs 3Q19 0.0%

challenges, as well as opportunities. We are competing against larger brands that have been marketing for over forty-plus years and in multiple jurisdictions. However, as a stand-alone property with great depth in Atlantic City experience, our team can make adjustments very quickly. We are more agile than the “big guys” and that has its advantages, particularly during this time of constant change. Atlantic City is an extremely competitive market, and our guests are knowledgeable. They demand great offers, great service, and great value. We are prepared on all fronts to give our guests what they want. What sets Ocean apart is that we offer the best product in the Northeast and offer the most rewards. We’ve taken a casino-first philosophy, and we put our casino guests first in absolutely everything we do. Operating with many of the restrictions put in place has been challenging but the team here at Ocean has found a way to operate in this environment profitably.

Gross Operating Profit 3Q20 Vs 3Q19 140.0% 105.0% 70.0% 35.0% 0% -35.0% -70.0%

Ocean Resort Resorts Casino







Ocean Resort



Of the nine operators in Atlantic City, if we include internet gaming revenues, only two reported increased operating profit 3Q20 compared with 3Q19. How did Ocean Casino Resort achieve such a performance? Ocean is a stand-alone asset, and with that comes Volume 16: Issue 143

During 3Q20, all Atlantic City operators including Ocean Casino Resort faced capacity and other limitations, such as no indoor dining and no drinking after 10 p.m. You were the only casino resort operator to grow both average rate per occupied room and rooms revenues. How did you deliver such performance? There was a lot of demand in Q3 for our room product. Ocean Casino Resort is a must-see destination located on the beach with an ocean view from every angle, including floor-to-ceiling windows showcasing the views in every room. Many people that typically vacation in destination markets were looking for similar resort experiences while staying closer to home. Ocean was able to offer that. 17

Feature: Ocean Casino Resort

Hotel Data 3Q20 Vs 3Q19 15.0% 7.5% 0.0% -7.5% -15.0% -22.5% -30.0%

Ocean Resort


Average Rate Per Occupied Room

Market Rooms Revenues

Can you provide more background and detail on the North Beach Initiative? North Beach is a great example of neighbors working together to create awareness for its area. At Ocean, we are proud to be a part of the North Beach group and It has been very rewarding working with the gaming and non-gaming businesses within the North Beach area to promote our community. It has developed into the city’s cultural epicenter that has really pumped new life into the northern section of the Boardwalk. There’s more information about North Beach on 18

Your plan for Ocean Casino Resort was to focus on the brick and mortar during 2019 and iGaming during 2020. How is that balance progressing? We did focus on brick and mortar in 2019 and continued to do so in 2020 and beyond, as opportunities still exist for us to increase our market share. I-gaming is having a very good year as well. We have accomplished many initiatives in this space during 2020 and are happy to announce that we have recently rolled out Live Dealer, which we expect to enhance our I-gaming performance. What other amenities are helping to attract

Feature: Ocean Casino Resort

customers at the moment and helping Ocean Casino Resort to differentiate its offering? For the time being, we are focused on gaming, food and hotel. We look forward to the day when we can safely reintroduce the other amenities our property has come to be known for. We’ve recently re-opened the popular Topgolf Swing Suite and Restaurant and we’re nearing completion of our brand-new high limit slot experience, The Cove. Our plan is to continue to build upon the momentum we created here at Ocean. When I last visited Ocean Casino Resort, I experienced for myself as I walked the floor how exciting, refreshing, and uplifting this casino resort is. Casino Life would like to thank Terry Glebocki and her Ocean Casino Resort team for sharing their knowledge and expertise with us. Volume 16: Issue 143


Photo credit: ©John Lupu/Shutterstock

Feature: Chicago

Second City no longer It looks like all systems go for a Chicago casino. By David McKee


hat if they gave a casino and nobody came? That’s what happened to the city of Chicago when the state Legislature authorized a downtown casino – at a 72 percent tax rate. Number of expressions of interest? Zero, zip, nada. Earlier this year lawmakers were persuaded by Windy City Mayor Lori Lightfoot to ratchet the usurious tax level down to 40 percent. As a result, Chicago has, like Spinal Tap’s amplifiers, gone from zero to 11. That’s the number of companies that responded to the city’s formal request for preliminary proposals. The answers to a civic questionnaire will form the basis for a Chicago request for proposals, which is when prospective casino owners will really talk turkey. First, a bit of history. In the summer of 2019, the Illinois Legislature and Gov. J.B. Pritzker authorized six new casinos and racinos in the state. One was earmarked for Chicago but for it and it alone a confiscatory tax rate was attached. That’s in 20

addition to a $250,000 application fee, a $15 million “reconciliation fee,” as well as $120 million in gambling-position fees, predicated on the assumption of 4,000 slots and table-game positions (some of the slots could be farmed out to slot parlors at Midway Airport and O’Hare International Airport). On top of all this was a $500 million impost, payable over two years. To say enthusiasm for this was tepid would be an understatement. Not one would-be casino developer bit at the hook and area politicians gave the back of their hands to Lightfoot’s choice of casino sites— mostly in various and sundry ghettos. “Put another way, tourists generally will not patronize a casino in an area that is inconvenient relative to where they are staying or perceived as unsafe, nor will tourists be eager to book a room at a casino’s hotel if there are no other easily accessed attractions nearby,” opined Union Gaming Group, in a study of the project. Union Gaming ran the numbers on the enabling legislation and deemed them “very onerous.” It

Photo credit: © Victor Torres/Shutterstock

Feature: Chicago

elaborated, “The amount of profit generated relative to total development costs … represents at best a 1% or 2% return annually, which is not an acceptable rate of return for a casino developer on a greenfield project.” Adjust the tax rate to bring it in line with other Illinois casinos, the study said, and the profit margin would shoot up to 20 percent or more. As things stood, “total enterprise profit margin would, in a best-case scenario, likely equate to a few pennies on the dollar,” assuming the casino could be built without incurring any debt— highly unlikely, not mention that the taxes and fees would scare off potential lenders. Armed with Union Gaming’s calculations, Lightfoot returned to the Legislature in search of relief. A foray to Springfield last winter proved fruitless but by summer, with Covid-19 shutting down the state’s casinos and budgetary needs taking on the cold, hard nature of reality, lawmakers were more tractable. They substantially reduced the tax rate and stretched the half-billion assessment (still massive) over six years, interest-free. Union took another look at the numbers and now liked what it saw. Indiana casinos would lose $260 million in revenue to the Chicago megaresort, plus another $37 million captured by the airport slot routes. Volume 16: Issue 143

And a “tourist-centric location” would generate $350 million in annual gaming revenue, especially if a fivestar hotel is a component of the resort. Put the casino in the heart of Chicago, and not at one of Lightfoot’s five peripheral sites, and cannibalization of existing Chicagoland casinos could be minimized, the study read. The bare-bones cost of a metro casino, according to one survey commissioned by Lightfoot, is $750 million. However, it was pointed that such comparable facilities as MGM National Harbor ($1.4 billion) and Encore Boston Harbor ($2.6 billion) came with substantially higher price tags, and Chicago leaders want a destination property, not ‘slots in a box.’ As an enticement, Lightfoot projects annual megaresort revenue of $1.2 billion, almost three times the amount grossed by Rivers Casino Des Plaines, by far the state’s best-performing casino. Wall Street, more conservatively, forecasts $833 million during Year One, ramping up to $929 million, then $1 billion in Year Three. Before you get excited, bear in mind that the final product likely won’t open until 2025. In the interim, operators have the offer of running a two-year temporary casino at a discrete site, with the prospect of a third-year option. 21

Photo credit: © Luis Boucault/Shutterstock

Feature: Chicago

Proximity to tourist-frequented areas is important, beyond the obvious reason, because most of the potential rivals are well outside the immediate metro area. That would mean weaning customers away from well-established properties like Rivers and Harrah’s Joliet, not to mention creating a destination casino so alluring that patrons would be willing to brave rush-hour traffic on the Dan Ryan Expressway, for instance. A metropolitan casino would be of convenience mainly to tourists, conventioneers (an important customer tranche) and downtown residents. With this in mind, Lightfoot’s administration crafted a request for information (RFI), essentially a questionnaire to gauge developer interest in the more investor-friendly Chicago casino. It drew 11 responses, although some industry heavyweights like Caesars Entertainment (already heavily invested in the region) and Las Vegas Sands took a pass. The respondents included three companies known for their ability to craft destination properties: Wynn Resorts, MGM Resorts International and Hard Rock International. An MGM stalking horse in the form of wellcapitalized real estate investment trust MGM Growth 22

Properties also cantered in, as did Rush Street Gaming. The latter is particularly interesting as it formerly owned Rivers Casino but sold the majority of it to Churchill Downs, which is making out like a bandit. Sellers remorse, Rush Street? (The company is Chicago-based, giving it favorite-son status.) The remainder of the field are dark horses such as Chicago Neighborhood Initiative, Christiansen Capital Advisors, Development Management Associates, DL3 Realty, R2 Companies and Related Midwest. What they have in common—except for Related Midwest— is a lack of gaming experience (and all want brand equity) and each would probably have to mate with a name-brand operator to emerge from the pack. While RFI responses weren’t broken out by operator, six of the 11 would want a temporary casino, partly to develop a patron database, partly to generate cash flow. Disincentives included the additional cost and “confusion in the marketplace.” (Christiansen and MGP did not answer that question.) All in favor would want the temporary casino near their downtown location—emphasis added. Navy Pier was suggested as possible site. Eight of the respondents want to be downtown, one wanted to be in the Harborside complex (which

Photo credit: © Boris Vetshev/Shutterstock

Feature: Chicago

includes a golf course) near the Indiana border and two expressed no preference. Easy access, “adequate parking,” juxtaposition to existing Chicago attractions and ability to exploit the Chicago River’s shores were also among the desiderata. Some developers expressed a willingness to let the city choose the site, which could bring locations like the defunct Michael Reese Hospital (which Union concluded had strong revenue-generation potential) back into play. All respondents indicated that the final product should have the same repertory of amenities as any other full-service casino, including hotel (as many as 750 rooms) and meeting space. One applicant, a casino operator, probably endeared themselves to Chicago hoteliers by saying it would rely on existing, nearby hotels and build a small hostelry of its own at a later date. Steakhouses, sports bars and, believe it or not, buffets were wanted by all, with a universal desire expressed to “leverage local culinary talent.” Given the preponderance of convention space already in the Windy City, applicants pitched the idea of multipurpose space that would be as amenable to concerts as to meetings. A modicum of retail was also mooted. Volume 16: Issue 143

As for other amenities, particularly entertainment, the consensus was that further study of extant Second City alternatives is needed. After all, this isn’t Las Vegas or Atlantic City, where the casinos are the only entertainment game in town. Besides, the opportunity is great to partner with area sports teams, theaters and museums. Even Covid-19 is being taken into account, with regimens being outlined that would include cashless check-in, thermal imaging, greaterthan-planned outdoor space, easy-to-clean furniture and fixtures, up-to-date air filtration and automatic entry. One casino operator, perhaps tactlessly, noted that Coronavirus economic fallout meant the potential labor force would be plentiful. Now the ball is in the city’s court. It will take the RFIs and use them to formulate them into a request for proposals, one that indicates some of the things Lightfoot’s administration wants to hear from its supplicants. It’s a tricky time to be entering the casino market in Illinois: Revenues have declined for the last seven years (going on eight) and the state’s appetite for new casinos is gluttonous. However, given a sufficiently must-see attraction and isolation from competing properties, the Windy City could have a bonanza on its hands. 23

Feature: Robert Ambrose

Covid-19. The Hospitality Industry Adapts Navigating Compliance Mandates, While Maintaining Consistent Guest Service


have always said that adapting to a crisis is built into the core of the hospitality industry. Hospitality is about employees serving guests within an environment that is fluid, and in that environment “life,” happens. My years in the hospitality industry, (the bulk spent in Atlantic City) have taught me that things don’t always go according to plan! All sectors of the hospitality industry are operated within a formula of fundamental business applications to achieve an operational balance, themed in “dedication to guest service.” It is not defined by masked employees, speaking to guests from a distance and wiping everything the guest touches. The human interaction, the warm smile, friendly greeting and pleasant exchange is the industries 24

presentation. The pandemic has struck at the very basic operation of the industry. The hospitality industry’s numerous brands have been the public’s “third place;” whether it’s dining, entertainment, retail, lodging or gambling. In Ray Oldenburg’s 1989 book, The Great Good Place he expanded on this premise, defining the “third place” as places where people gather, putting aside their concerns of home and work to enjoy an experience. The Covid-19 virus has limited access to many of our third places and struck at the markers that make up our social core. We have lost the opportunity to sit at a café or dine with companions at a restaurant. Our travel has been restricted, leaving us with only memories of places we have been. Simply stated, the casino floor is just so different now. Collectively

Feature: Robert Ambrose we now conduct business, education and social time using our computer as a portal. Many times, new business models are created out of circumstances. At the onset of the pandemic, industry members found ways to adapt to new regulatory operational parameters with restrictions. It was, at best, education on the run! Within hours of property shutdowns, plans were developed to improve the resorts’ operating floor models, promoting distance and sanitization for all customer touch points. Investments were made into healthier air quality. And technology was about to play an increased role in service delivery from digital restaurant menus, keyless hotel-room entry to a cashless casino floor. In many ways the industry was already heading in these directions pre-pandemic. What we are seeing is a more rapid deployment and placement of the technologies because of it. On the cashless topic, there are a few casinos in Nevada and scattered Tribal properties that offer the cashless/digital platform. Coronavirus can survive on paper. And in many ways the casino industry is late in the game compared to other industries for the cashless conversion. Obviously this is a regulatory issue for each jurisdiction in the U.S. An 18-month study was completed this year by industry members. And the American Gaming Association has also been championing the plan for casino digital payment platforms as well: https://www.americangaming. org/wp-content/uploads/2020/06/AGA_Payment_ Choice.pdf The fall weather here in the northeastern portion of the U.S can be as unpredictable as the roll of the dice. Despite some great, even warm fall weather until December this year, visitation to Atlantic City was down. Additionally, the state changed the dining mandate for all dining to close at 10 p.m. I spent some time in Atlantic City recently on a sundrenched fall day and found the Boardwalk a quiet place to be. It was mid-week and I did not expect to find many customers engaged in gambling activity anyway. At one of the casino properties I visited, entering from the Boardwalk side, I was met by a security guard that asked me to read the large sign next to him. Basically, it asked some general questions about my health. There are some properties that also check your temperature. All that is very good but not as effective as what is actually taking place in applied safety protocols around the properties. Casinos Volume 16: Issue 143

promote distance with every other slot machine powered off and plexiglass around tables, and of course the only live events anywhere take place with the human foot traffic outside of the buildings. Personally, I have witnessed first-hand Atlantic City’s good and bad times. The Atlantic City hospitality industry has seen decades of its complex infrastructure tested. With each economic downturn or business interruption its hospitality workforce has maintained a certain resilience. This time Covid-19, has impacted the industry with a major loss of jobs and benefits worldwide. The impact has spread throughout the industry supply chain to other business sectors and into the local communities. As the industry continues to deal with the pandemic’s collateral damage to its various operations, experts are predicting a 12-24-month into 2023 recovery at best. Many of the safety protocols and operational modifications to the industry’s infrastructure won’t stop when the pandemic ends. As of this writing, we are still at pre-vaccine release here in the U.S. And there is a difference between states based on Covid-19 ‘hot spots,’ on the depth of restrictions on hospitality venues. Some have open dining with distance while others have given specific time frames for operation or completely shutdown. In New Jersey the gaming operations in Atalntic City must cease all dining at 10 p.m. Those hotel guests may need to brown bag it! Just a 50-minute ride to Philadelphia and you will find the only casino in the city proper (Rivers) completely closed because of the tightening of restrictions in the city. (I should note that the Philly “Live” hotel-casino grand opening date has been pushed back to 2021.) Yet a short drive of less than 15 minutes to the next county in three separate directions and it’s all the gambling you want with fewer dining restrictions. Early in the pandemic, as we were all finding our way, my commentary in Casino Life in early spring stated that I saw the third quarter of 2020 as transitional for the casino/hospitality industry in Atalntic City in part thanks to the summer beach environment. Also, a positive fourth quarter would be something to aspire to, knowing it would probably be more of a continued bleed-out wound; with only minimal signs of healing. I wasn’t far off the mark, influenced by the state mandates continually changing for operations of dinning and customer capacity. Sports betting and online gambling for the nine New 25

Feature: Robert Ambrose

Jersey casino properties have provided a positive cash flow against the backdrop of the mandated capacity limits for the brick-and-mortar Atalntic City casinos. This is the same for all U.S casino jurisdictions that permit online gambling to take place. And those jurisdictions that do not have online gambling are considering it. Online gambling has seen continued growth in New Jersey since its legalization in 2013. The Atlantic City casinos were closed for 107 days in the beginning of the pandemic. They didn’t reopen until mid-July, losing part of the summer business. Luckily through October we experienced good weather. The online gaming revenue alone in N.J increased 106 percent year over year in October to $93.45 million. Sports betting was a record-setting $803 million. This against a backdrop of 8 percent decline from the brick-and-mortar same month last year. Slots were down more than tables but it’s feared the worst is yet to come based on the upcoming winter months. Job eliminations and reduced working hours are becoming the norm. Thankfully, the integrated resort experience through the years has grown in product diversification. Today’s resort model is a variety of property amenities. Separately, they each offer an experience, coming together now as a collective brand, they are all trying to survive. They meet the challenge, with safety protocols, for dining, entertainment, retail, lodging or gaming. However, the caveat here is that without guest traffic 26

from casino visits on property, non-gaming amenities are in the negative. So, diversification is good but without customers on property nothing helps. Recovery for the industry will be a slow, coordinated effort. That means a need for state (regulators), city officials, industry suppliers, properties and academic institutions working together. The academic role will be paramount in terms of providing even more strategic research and focused employee/student educational programs assisting the industry in terms of “bestpractice” methods and solutions to aid recovery. Data collection will be key. Research will be very important to Identify any new patterns of customer behaviors. It will be important to compare pre- and post-pandemic visitation. Has frequency of customer visits changed? Has their time on device lessened post-pandemic? Direct communication with customers should be ongoing along with welcome-back offers. Allow the analysis time to show patterns of behavior. Remember it is about consistency of behavioral activity on property, not necessarily the peaks and valleys. This is where critical data-driven analysis must take place to produce the beneficial marketing programs to return business consistency. As I stated before, a re-analysis of customer tracking based on new live data will guide the future marketing programs. Established safety protocols have become mainstream and will be with us in one form or another in some cases permanently. So, what does that all mean? On the safety side, will most customers want

Feature: Robert Ambrose to unlearn the safety protocols they feel comfortable with? Should they have to? One of the keys is reestablishing consumer confidence to physically visit. Stakeholders must promote their operational-safety protocols in full transparency perhaps in the form of newsletters or mass emailings to customers in their data base and the press, explaining what has been done for their safety. As an example, Delaware North recently reopened their three casinos in New York State. They made a point of demonstrating their enhanced safety protocols directly in the media. An openness must be conducted in employee education to make employees feel comfortable and to help promote customer awareness as well. I suggest employee meetings and copy them on many of the property-customer communications. They are your front-line employees and building their confidence as we return to business will go a long way in the customer exchange. Although it has been said we are looking at a new normal ahead, we can also say it is an improved normal with upgraded service deliverables and better communication. This will be ongoing education for all. Some closing thoughts on Atlantic City. Prepandemic Atlantic City was showing some great numbers in terms of its financial re-positioning in the East Coast casino/hospitality market. The city’s ratings were up and the nine properties were becoming more competitive again. In the past couple of years, we have seen more diversity of property ownership. I have said for many years that multiple property ownership is not good for the Atlantic City market. It stifled growth. With the entry of Hard Rock, Ocean Resorts and now the Bally takeover the city is getting part of what is needed for market growth. Competition! Metaphorically speaking it could be off to the “races” for the nine casinos when the pandemic tide subsides and they line up at the starting gate for their longer-range marketing initiatives to bring back visitation. We may see a different hierarchy in terms of which property leads the city in revenue, perhaps knocking out some of the traditional front runners. We will see the friendly smiles of hospitality employees again in our chosen “Third Place.” Bob Ambrose, Consultant, Adjunct Gaming Instructor, former Atlantic City Casino Executive Volume 16: Issue 143


Feature: Global Payments

Everybody’s a VIP Global Payments democratizes the high-roller experience with its VIP Mobility app. By David McKee


uring this time of global pandemic, “cashless” is the new buzzword of the casino industry. And one of the companies best poised to aid in that transition is Global Payments Gaming Solutions. “We’ve been talking cashless for years, and while there has been interest in our VIP Mobility solution, the impact of the COVID-19 pandemic accelerated this interest, says President Christopher Justice. “Consumers are looking for assurances that it’s safe to go back and play in the casino.” “A few benefits cashless solutions offer include the reduction of crowded and congested areas, mitigation of lines, few-to-no face-to-face transactions and an increased ability to adhere to social distancing policies and considerations,” Justice continues. “At the end of the day, we want to enable safe and fun gaming experiences; cashless solutions is the way to make this happen.” While hardly intended as a Covid counterweight, Global Payments’ new VIP Mobility application is a cashless solution for terrestrial and online payment that saves customers from a lot of unnecessary 28

touching. VIP Mobility works in any of three ways: • To add funds to your VIP Mobility account, select a preset or customized amount, then tap “Add funds.” Hit “Done” and you’re ready to play. Reverse the process by selecting “Transfer funds,” “Transfer to my bank,” choose amount, click “Done” and “Transfer funds,” and “Done” again. • When playing the slots, select “Play,” choose the amount you want to set aside, select “Next,” scan the QR code on the slot machine. The VIP Mobility app funds your slot play. Then select “Done,” redeem your TITO voucher by typing in the amount won, select “Redeem voucher,” scan the voucher, then select “Done.” • For table-game play, select “Play,” enter the amount you want to hazard, select “Next,” scan the QR code on the table. “A voucher that identifies the player, amount and table number is printed. Chips are exchanged, the voucher is dropped in the cash dropbox by the dealer and funds are withdrawn from the VIP Preferred account.

Feature: Global Payments As Justice summarizes, I can walk into a casino without cash or debit card on hand, I can fund up my game, I can play to my heart’s content. Then when I’m finished, with a touch of a button I can put that money back in my bank account and I can leave the casino without any money in my pockets. I don’t have to worry about any security issues from walking through darkened parking lots. So there’s a huge number of significant opportunities here where we going to help drive far more consumer adoption with this solution than others that are out there being contemplated.”

A wallet or a ledger?

“Many people would refer to it as a wallet,” says Vice President of Marketing Justin Sprague. “From a design perspective it’s actually what we would consider to be a ledger. It’s integrated into the casino-management system and if you watch the work flow you would realize it is digitizing the TITO ticket.” VIP Mobility was beta-tested at Downstream Casino & Resort in Oklahoma. Customers there responded positively, with one saying that it spared her going to the casino cage with VIP Mobility making her a “cage-free” player. Others cited safety (no third-party financial providers involved), the “very streamlined” design and more time on device, the Holy Grail of slot operators. From Downstream, VIP Mobility has flowed to other Native American casinos in Oklahoma and California. Why tribal? Because Justice says, they are quick decision-makers. “Needless to say, we have had multiple conversations with every major operator around the country. There’s a huge amount of excitement over this solution but, as you can imagine, with committees and a variety of other things it takes a little bit longer.” Justice adds, “we are still going on a regulator road show and having conversations with a variety of commercial as well as Native American jurisdictions. We’re taking it to those folks and showing them that it’s certainly compliant. We have GLI and BMM stating that it does comply with all the rules and regs and no additional testing or certification is required except as determined by the jurisdictions. But we’re taking a very methodical approach as we’re moving down the path with it.” Founding Member, The Strategy Organization Josh Swissman chimes in to point out that VIP Mobility stands on the shoulders of Global Payments’ VIP Preferred program system, which has 20 years of Volume 16: Issue 143

history behind it and is in roughly 500 casinos already. Adds Justice, “one of the benefits of the solution and why it’s much more cost-effective for casinos to implement is it does leverage existing systems that are in place.” “Speaking as a previous operator,” says Swissman, who has worked in Las Vegas, Atlantic City and Macao, “the other thing that makes this product amazing is that in addition to leveraging all that preexisting infrastructure and the preexisting regulatory environment that Chris talked about, it also leverages existing operational procedures. It doesn’t require wholesale retraining of any auditing or accounting staff. So that makes the rollout, implementation and ultimate success rate much, much, much higher than it would be if it caused a redesign of the casino auditing process.”

Flexibility of payment

VIP Mobility also provides access to Global Payments’ Choice4 technology. Can’t cover your transaction? Choice4 enables you to defer payment anywhere from seven to 28 days, on the understanding that you will have the necessary funds in your bank account by that point. Global Payments claims that this is unique (and not offered in all jurisdictions). “Because this is built on the VIP Preferred e-check-cashing platform, the success rate of these transactions is much greater than what you might see in terms of other funding mechanisms. Obviously, the greater the success rate of a transaction, the happier the customer is and the more likely they are to be repeat users of the cashless gaming product. So that is a big competitive advantage,” Swissman says. With so many electronic checks being written, what if one of them bounces? Justice points to Global Payments’ $50 billion market capitalization: “One element about Global Payments is that we warrant all of the transactions, so Global Payments effectively stands behind all of those transactions to provide gaming integrity that’s second to none.” Justice allows that “Every electronic transaction has some element of risk. Whether it’s an e-commerce transaction that you may find relative to or others, Global Payment’s put a huge investment into being able to effectively guarantee the transactions and provide the game integrity that not only the operators but the regulators want to see.” As for integrating VIP Mobility with preexisting 29

Feature: Global Payments program to date,” Justice continues. “That grows 25,000 to 35,000 new customers every month. That growth is really coming from the fact that it is the only omni-channel funding solution here in the

VIP Preferred infrastructure, it saves casinos from regulatory headaches. “By leveraging the TITO system it doesn’t introduce new regulatory obligations to the casino operator, as opposed to trying to implement a mobile wallet or some other kind of system that’s talking directly to the games,” says the president. “A lot of the other apps you may have seen have multiple systems to divide into, transferring money out of your account to an intermediary, transferring money to your wagering account and from your wagering account to the game. We just feel there’s a far better approach that delivers the ultimate customer experience and that’s why we think this approach is certainly the best one that’s out there.

“Clicks kill”

“Secondly, we do have a significant funding advantage from the standpoint that Global Payments has three and a half million customers in the VIP Preferred


marketplace today, and helping capitalize on the convergence of physical Downstream Casino Resort and digital worlds where consumers, across all segments, are becoming omni-channel consumers, shopping online, returning in the store, leveraging all sorts of tools and capabilities across channels.” Since “clicks kill” in online transactions, with customers wanting as few clicks as possible, Global Payments has aimed to eliminate as many clicks as it can. “Effectively, VIP Mobility has the best customer experience of any solution out there. It minimizes the number of clicks and delivers the kind of result consumers expect,” Justice asserts. “Equally important,” Swissman jumps in, “it is a super-slick interface that is very user-friendly. This doesn’t really change the guest’s gambling experience. They already use TITO tickets, they’re already familiar with them. All this really does is digitize them and in a way that’s a very easy, intuitive, easy-to-transact experience. The friction is quite low as far as user adoption, ongoing user utilization and ultimately ongoing engagement with VIP Mobility.” Company execs also stress that the wide adoption of VIP Preferred means that guests can go from casino to casino, even across the country, and “have your VIP Preferred account be up, running, approved and funding can happen immediately without any additional steps taken to register,” says Swissman. One can also go from brick-and-mortar casinos to online without having to reverify one’s identity. “It is transferable across all different VIP Preferred and VIP Mobility-enabled casinos, whether that be online or off-line. A lot of

Feature: Global Payments

the competitors that are out there, while it may be the same solution, it requires you to re-register as you move from one casino to the next,” he adds “For those who move from place to place, whether online or offline, that becomes a huge barrier to entry that Global Payments has blown right through, which is a huge benefit to customers.” Or, as Justice puts it, “There’s a huge number of benefits, and the customer experience is A-Number One the most important element in order to drive the operating results needed for return on investment.” Don’t have a QR code or banking software on your phone? No problem. VIP Mobility is designed as an end-to-end solution, nice and simple.

Simple is beautiful

“You download the app from the App Store and that’s all the consumer has to have on the phone,” Justice explains. “The technology that we have built into the application bridges the gap between systems that are already regulated, controlled and operated within the casino. We own the role of data security and facilitate the connections in a compliant way.” This is all well and good but consumer response is critical. Of the Downstream player endorsements, Swissman says, “Those were all Day One testimonials. It wasn’t like they had a long learning process there. They each had the app installed on their phone just hours before those testimonials were given and they’ve become skilled, adept and were able to ascertain the value of migrating to a product like that.” Justice calls the level of customer adoption “significant”: 65 percent. “They didn’t just show up, Volume 16: Issue 143

try it and never use it again. Funding volume has increased into the double digits. So it’s really helping to drive really solid results for a casino operator,” he notes. “Some of the other significant operators that we work with that are best in class relative to just their marketing mobile applications, their adoption rate for their millions and millions of loyalty-card holders is in the single digits.” Chimes in Swissman, “not only is their solid adoption but there is equally solid retention. This wasn’t a one-and-done thing for these folks. In big percentages they are continuing to use the application because they are continuing to drive incremental utility and advantage from doing so.” “So where we feel we’ve got a certain advantage— which is the whole reason we’re more than 40 percent of wallet share when it comes to online gaming—is that when consumers use VIP Preferred as their funding method for online gaming, they know the result that they’re going to get,” interjects Justice. “They know that the transaction’s going to get approved. They get to place their bet for Super Bowl, Wimbledon, they know they’re going get that great experience and that’s why we have such a tremendous funding advantage.” Concludes Swissman, We’ve all become more technologically comfortable in this pandemic. That bodes well for wider-scale user adoption.” It would certainly appear that way.


Feature: Sumsub

Identity Verification Jacob Sever, Co-founder & Chief Strategy Officer at chats with Peter White


Feature: Sumsub


ne of the increasingly dire issues facing the casino industry are anti-moneylaundering (AML) measures or the lack thereof. Corporations as mighty as Crown Resorts and Las Vegas Sands have gotten in trouble for the lack of proper AML infrastructure. These need to be part of an end-to-end solution and Sumsub is offering that and Know Your Customer (KYC) technology–and not a moment too soon. When was the company founded and what was the inspiration behind starting the organisation? I started the company with my brothers – Andrey and Peter – back in 2015, when the interest and the demand for our technology was only beginning to emerge. What brought us to the subject of identity verification was in fact our previous project. Before founding our own company, we were developing software that could recognize alterations made by graphic editors. It turned out to be a sensational weapon against insurance fraud—we could help companies to expose fraudulent insurance claims by detecting traces of photoshop within documents and photos, which were often submitted by car owners who were faking car damage in order to cash in on insurance. From there, we grew to offer our solution to a variety of industries. At some point in time, we were even helping to solve police investigations while analyzing satellite images for graphic alterations—it has been a fun journey, to say the least. While we were satisfied with our results, we still dreamed of exponential expansion. Perhaps the first step taken to where we are now, was the project with our good friends at Cryptopay, for whom we developed our first compliance and anti-fraud solution, which was based on our earlier technology. We put together everything that a company would need in such a case—our technology for the detection of graphic alterations, face matching, AML data, and tens of new features. The resulting product ended up selling like hotcakes. We were convinced that the demand was there. Rightly so too, as it definitely was, and is now greater than before. What are the most common difficulties and challenges organisations experience and how has Sumsub helped them? Volume 16: Issue 143

The main struggle is usually related to the absence of a unified solution for the compliance and anti-fraud challenges that businesses are thrown into from day one of their launch. They are either forced to develop their own custom technology that takes years to complete, or they end up using a few segmented solutions. Let’s say, one for EDD, another for AML, in addition to seperate ones for identification, crypto monitoring, legal support, lifecycle management, etc. One more solution, if it can be called as such, is to engage in manual processing throughout the company, which is highly unprofessional, time consuming and simply impossible to maintain in the case of larger businesses. Because of this, companies end up spending their time and resources struggling to coordinate a handful of different solutions, while either missing instances of fraud or hurting conversion. We, on the other hand, solve these problems entirely by providing a flexible and customizable solution for any check that they might need, all under a single roof. What are the key attributes of the Sumsub KYC & AML Compliance Software? Sumsub is the first unified, automated compliance solution for regulated companies. We provide antifraud, KYC, KYB, crypto compliance and liveness checks, while offering a powerful dashboard that allows compliance officers to analyze statistics and manage their teams. All of that is catalyzed by constant support from our customer and legal teams. What has been Sumsub’s reaction to these tighter requirements for gambling sites, how has the organisation assisted with operator compliance, and is there more that can be done? We are always coming up with new features and broadening our array of products, so that we can give our clients exactly what they need, from a single source. We are currently working on developing more types of checks, including proof of source of address and proof of source of funds checks that are especially vital for the casino industry and the gaming industry in general. Of course, we are also constantly upgrading our system’s capabilities, developing new settings in terms of check rules, branding, user paths and verification triggers. There is always more that we can do, and for that, we are very attentive to what our 33

Feature: Sumsub

clients have in mind. It isn’t uncommon for a feature to appear as the direct result of a client request. Basically, we put our minds to anything that could enhance our solution and help solve more problems. Besides, jurisdictions are always changing; we see new regulatory laws and demands emerging with every new year, sometimes even with every new month. It’s important to constantly evolve to power up businesses with functionalities suited to these new rules. How widespread is underage online gambling? Underage gambling is as popular as ever. No wonder; minors have plenty of means to do so. Almost every household has a laptop, while almost every child has a smartphone. It doesn’t take much to swipe your parent’s credit card and make a bet, especially in places where online gambling is poorly regulated and there is no sophisticated identity-verification system to protect the business and the minors, both of whom are likely to face unpleasant consequences. How easily can Sumsub’s software be integrated into websites? Our system is extremely easy to integrate. We essentially provide a line of code that can be inserted into your app or website, and that is practically it. Of course, we also support our clients with the documentation that covers every aspect that might require clarification, as well as multiple features that make the work of the developers much easier. 34

How secure is your system? We maintain bank-grade data security, which is at the core of our developmental and operational principles. Our services and data are hosted using Amazon Web Services. All the information is encrypted and stored on our servers, which are located within European Uptime Institute-classified Tier III data centers. We encrypt, monitor and back up our data, allowing access only to authorized team members who need it for work. Twice a year, we conduct penetration tests on our app and framework with the help of third-party security experts. Besides, we provide security and awareness training to all the employees who have access to client data. Is Sumsub available for use with operators Worldwide? We are working with operators from all over the world and cover 220-plus countries and territories. Sumsub is doing especially well in our domestic regions, Israel and the U.K, while significant progress is being made in the U.S, Australia, New Zealand, Singapore, Hong Kong, and South Korea. Is Sumsub fully compliant with GDPR? Sumsub supports customer compliance with data protection laws across the globe, including GDPR. What is your experience of the gambling sector to date?

Feature: Sumsub is growing and there is just too much going on to support its rapid expansion. However, I know a couple of our team members who are quite fond of betting and especially e-sports.

Apart from standard KYC, the gambling sector holds a number of specific demands, such as proof of source of funds and proof of source of address verification. We have been working in the gambling industry for a while now and understand the relevant risks and challenges that operators face: identity checks, failure to verify proof of source of funds, poor client monitoring, undetected problem gambling, loose risk assessment and EDD. The casino industry is quite an attractive place for criminals and fraudsters to thrive off too. For that, we learned how to protect the gambling sector from these problems by setting the right triggers and providing proper KYC and AML technology and guidelines. Some of the clients we have helped along the way are Kajot-casino, Powercasino, Lottery Heroes,, DrBet, Rednines Gaming, Kingswin, CopyBet, Lotto Agent, and Rivalry.

Investment in technology and innovation is essential to the growth of the organisation wouldn’t you agree? Well, of course. Technology and innovation drives progress, while bringing efficiency and easiness to processes across all possible fields. Indeed, given that these are our core values, I wouldn’t dare to contradict them. Now that the company has steady business growth, what are some of your prime objectives over the next 18 months? I would say that, among our current primary objectives, we would like to grow the percentage of operations in certain regions and sectors; the gaming industry being the area we are looking to expand in the most. Have you got anything else that you would like to add? Thank you for having us.

Do you think there is a role for AI technology within the identification of online customers who are at risk and need to stop, and is that an area in which you would look to expand? Yes, of course. We provide proof of source of funds checks that help us detect problem gamblers and prevent them from losing even more money in the game, assuming that they can’t afford such losses. Do you gamble, and if so what do you put your money into? Casinos, e-Sports, betting shops, sports betting or the lottery? I am afraid we just have no time for that. Our business Volume 16: Issue 143


Feature: SuzoHapp

Providing Success to Casinos Tim Kennedy, Sales Director, UK, SUZOHAPP talks to Damien Connelly


Feature: SuzoHapp


ow does one do business ‘as usual’ in the midst of a global pandemic? One of the companies that’s adapting to the new normal is SUZOHAPP. What’s more, it’s taken the proactive step of wading into Personal Protection Equipment (PPE) manufacture. Nor is it limiting its efforts to the gaming sphere, donating PPE to the hard-pressed medical sector. Amidst all this, SUZOHAPP still has the time to look forward, as we discovered. The world has changed since our meeting during ICE London! How have employees worldwide at SUZOHAPP adapted? We were very fortunate going into the coronavirus crisis to have a pandemic contingency within our crisis plan. Additionally, with one of our manufacturing plants located in China, we had a head start in figuring out best practices to work effectively while maintaining social distancing. That being said, we’re still learning and there is a still a lot unknown that we will likely need to respond to as it seems that a second wave may be coming. The most important trait for us, was to learn how to be flexible and to adapt. As guidelines and recommendations for how to deal with the virus are constantly changing, we have changed our processes to be more fluid so we can react to these changes. We still have a large majority of our office staff working remotely and have extensive precautions in all our warehouses to keep everyone safe. Travel is still limited so all of our sales calls, both internally and externally, are all virtual. We’ve learned a great deal about what we can achieve without our regular tools and with these extra precautions so it’s Volume 16: Issue 143

likely that, even if things return to normal, we will keep a lot of our precautions and new practices in place. How has SUZOHAPP products to date helped the industry in its recovery? We have tried to do whatever we can to help our customers during these hard times. After the pandemic hit, there was a massive influx of personal protection products that hit the market of varying quality, consistency, pricing and relevance. In an effort to help guide the industry, SUZOHAPP launched the Personal Protection Line to help operators sift through the noise of all of these new options to find high-quality items relevant to the gaming industry, at fair prices that would be consistently available. While most large operators have cleaning companies that they are able to source a lot of PPE-type items from, many of the smaller operations were struggling to find products in the quantities they needed at affordable prices. Not only do we offer the standard masks, gloves, sanitizer and sanitizer dispensers but our gaming-specific items include separators to protect from air transmission between machines, chip cleaners, UV lights to sanitize game surfaces safely and much more. From an operational standpoint, ensuring continuity of service was our first big step to make sure customers that were open were able to get what they needed from us to keep their businesses running. We held shipments for companies that were closed so they would not have to pay right away. We worked with customers them on payment options. We picked up business lines that have been shut down by other manufactures to keep production lines running across the industry and sourced and even donated 37

Feature: SuzoHapp

PPE such as masks etc to help everyone stay safe. Was it enough? There’s so much need right now that nothing is enough, but we felt we had to take what strides we could to at least keep the industry and our customers operational. How is your “Simplify Your Sourcing” approach performing with customers? The depth of our portfolio is definitely one of our greatest strengths. This year, as with the rest of the industry, our focus is on sports betting. While there are a lot of new entrants to this market, most only exist in the digital sphere for sports betting. Alternatively, we aim to be the single source solution for hardware. Not only can we provide a multitude of peripheral items for sports-betting terminals but we actually have full turnkey solutions to be that “one stop shop” for sports betting companies looking to keep their focus on the digital aspects and outsource the hardware elements. What was the reaction from MPAC Healthcare to the SUZOHAPP donation earlier this year of over 6,000 surgical masks? We were overwhelmed by the amount of gratitude from MPAC, which was a true testament to how dire 38

the situation was at the time. As we considered how to put the masks that we had to best use, we did some soul searching to evaluate who we are as a company and where the need was greatest (though the need was and continues to be everywhere). SUZOHAPP has been in the industry now for over 30 years and has a long memory. Some of our amazing team members and many of our longstanding customers have been with us from the beginning. When we considered that those friends and colleagues were the people most vulnerable to the effects of the virus it became immediately apparent that we had to put our efforts towards helping where we saw that weakness. MPAC supplies nurses and medical staff to the elderly in nursing homes, a category that continues to be hardest hit by the virus. The statistics that we were seeing at the time regarding supplies and staff at nursing homes were concerning and we felt we had to do something. The nurses of MPAC sent us thank you cards and photos of them being able to put those masks to immediate use. Even with masks on, you could see the relief and gratitude in having the tools they needed to keep them safe in their jobs and keep their patients safe.

Feature: SuzoHapp

How are your products sales performing in the fast-growing sports betting sector? We will definitely see the continued rise of online gaming and sports betting as we come out of this. As an industry, we will need to adapt to get with the times and remote play, given the current situation, is a hot market. We will likely see more integrations with mobile phones, either through contactless payments or perhaps in actual gameplay. There is a myriad of possibilities of how casinos might get into the online gaming space and we are already seeing sports betting take its place on the casino floor. For us at SUZOHAPP, we want to be the single source offering not only the peripherals for sportsbetting terminals but full turnkey solutions for sportsbetting hardware. Our sportsbetting products are performing exceptionally well as we have recently secured a partnership with a major player in the market (which you will likely hear about in the coming months). It is clear to us that sportsbetting is definitely where the future growth of the industry lies and we will be there with it to see it grow. Looking ahead to 2021 what will be amongst the main objectives for SUZOHAPP? While we’ve certainly had our hands full in 2020 with reacting to pandemic crisis, we decided early on that we couldn’t let this crisis change who we are and that any reaction we took would need to still adhere to our values and our mission. Our motto “Simplify Your Sourcing” is the anchor we use to guide our planning and decision-making when it comes to our product offering. Globally, there have been scale backs and downsizings that have really made sourcing difficult for a lot of manufacturers and even operators, which hurts the industry and compounds the difficulties Volume 16: Issue 143

that we are already going through because of the pandemic. For 2021, our intent is not only to continue to serve as we have for years with our large product offering but to also pick up where others have dropped off to really be that streamlined source. Many businesses are trying to do more with a leaner staff, so the cost of the time spent trying to source multiple products individually is much higher than it used to be. We want to help with that. We’ve obviously had setbacks along the way and anticipate that we will continue to face more obstacles with potential reclosures in the colder months being a big barrier to getting stock, but we continue to do our best to overcome those challenges to ensure our customers have what they need.


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Feature: Legislation

Gaming Legislation Update Report on Gaming Legislation in Spain, Germany and France By: Marko Tomic, Partner, Law Firm Anđelović, Siketić & Tomić d.o.o. Zagreb 1. Spain

Gambling in Spain is regulated under a Gambling Act which entered into force in 2011 and to this date underwent more than a few amendments with new ones in the horizon for 2021. Private operation of games other than lotteries (still a monopoly) was authorized upon implementation and development of the Gambling Act. The Gambling Act defines four specific types of game of chance (lotteries, betting, raffles and contests) and one general category of ‘other games’ that serves as a catch-all for activities that fall under the general definition of gambling but not under any of the four specific games definitions. The Gambling Act envisaged the formation of a new regulatory body, i.e. the National Gambling Commission (CNJ). However, the CNJ has yet to be formally set up and there are no expectations that this will happen in near future. Until this happens, Directorate General for Gambling Regulation (DGOJ) will continue to exercise regulatory powers in respect to organization of games of chance in Spain. Regulation of games of chance differs between online gaming offered at the federal level and landbased gaming or online games that are offered at regional level. If a game is not regulated, it is not permitted. Bearing in mind that Spain has 17 autonomous regions which each have their own licensing regime it is safe to say that conflict between the authorities of different regions is quite common. With respect to licensing, the Gambling Act envisions two types of licenses: (i) general licenses which may be granted for a 10-year period with Volume 16: Issue 143

the possibility for renewal for a subsequent 10year period, except for cases in which the number of general licenses awarded is limited under the Gambling Act; and (ii) specific licenses for individual games (e.g. exchange betting) granted to operators holding a general license and which are granted to a one-to-five-year term with the possibility for renewal. Any sort of advertising, sponsorship or promotional activities related to any of the gambling activities regulated by the Gambling Act is forbidden unless permitted in the respective general and specific license. Further, in November 2020 Spanish government introduced an additional restriction for commercials on TV/radio/Internet to a narrow window of late-night times (from 1 a.m.-5 a.m.), eliminated gambling sponsorship of sports entities and limited operators offering bonuses only to existing customers. Furthermore, existing online advertising contracts will be allowed to continue through May 1, 2021. After that, operators will only be allowed to promote via their own gambling sites. Operators who fail to abide by the new rules could face penalties starting 41

Feature: Legislation at €100k and ranging up to €1m, along with possible suspension of their license for up to six months. The latest novelty is that the government intends to modify the Gaming Law to include Loot boxes or virtual items users can purchase in video games with real money as a game of chance. The government will draft the final text of the law during the consultation period, and aims for it to be published by mid-2021, focusing amendments on aligning responsible gambling standards and consumer safeguards across Spain’s 17 autonomous regions.

2. Germany

The Interstate Treaty on Gambling from 2012 as amended on January 1, 2020 (“Treaty”) creates the main legal framework governing both land-based and online gambling in Germany and sets out the main objectives and core elements of German gambling regulation. Provisions of the same are implemented into state law by the transposition acts and the gambling laws of each of 16 states whereby there is no comprehensive list of permissible and non-permissible games or products. The Treaty maintains a state monopoly on the operation of lotteries, stipulates a total ban on online casino operations (with the exception granted in 2019 for Germany’s most northern state, SchleswigHolstein, to deviate from the Interstate Treaty’s total ban and introduces a law that will revalidate Schleswig-Holstein online casino licenses, which 42

have expired in 2013) and provides for a licensing procedure for sports betting. As a curiosity, a vast majority of land-based casinos in Germany are still run by the state. Germany has more than one regulator. The type of games of chance offered and where the same is offered will be crucial factors when determining which regulator will be responsible. The responsibilities range from individual municipalities

acting as regulators to respective ministries of the German states to authorities that have assumed a central responsibility for a certain sector and, as such, act on behalf of all German states in relation to this sector. The Regional Council of Darmstadt in the state of Hesse is responsible for conducting the licensing process in Germany. As noted above, the Treaty generally prohibits the operation of online games of chance with the exception for sports betting, horse-race betting and lotteries. Thus, online casinos are currently not legal although there is discussion ongoing for this position to be relaxed (permission of virtual slot machines and of online poker) in the envisioned amendments to the Treaty planned for 2021. Respective amendments also envision no advertising for the forms just mentioned may be broadcast either on TV or on the Internet between 6 a.m. and 9 p.m.. When it comes to licensing there is no uniform regime in place whereby licensing of sports betting was permitted as of 1 January 2020 in addition to already existing lottery, casino, slot machine and horse-racing licensing. Based on the information available online, most of the enforcement activity regarding offshore operators tends to be targeted at EU-licensed (not-German) operators for reasons of practicality rather than at operators that do not have adequate licensing or sufficient consumer protection measures in place. Changes envisioned for 2021 would allow exemption from enforcement for licensable products in Germany if in line with the Treaty.

Feature: Legislation

3. France

Even though France has a long tradition of games of chance, its legal framework regulating games of chance is still considered quite rigid. The Security Code enacted on 1 May 2012 comprises a significant portion of the gambling regulations in French law while online gambling was addressed and regulated by the Online Gambling Act already in 2010. Respective Online Gambling Act refers solely to sports betting, horse betting and club games (only poker is currently permitted). Land-based casinos are strictly regulated venues and as such must provide three different activities (entertainment, catering and games) and are not allowed to offer all casino games without limitation (only those for which the operator holds a valid license). In addition, apart from sports betting, the only authorized forms of betting in France are horse and greyhound betting. Importing and/or manufacturing slot machines is prohibited under the Security Code whereby certain exceptions apply to casinos. The regulation of gambling and organization of games of chance in general is carried out by different governmental authorities depending on whether it is land-based gambling or online gambling. With respect to licensing, sports betting and most lotteries fall under the monopoly of a state-owned corporation while a special legal entity created by horse racing companies to manage their betting activities has a monopoly on the organization of horse betting. Licensing regimes available to private entities are in place for casinos and clubs. Regarding the licensing of online gambling, an online operator can only offer gambling products in France (i.e. websites targeting French residents) if licensed by a competent authority before commencing gambling operations. Thus, platform Volume 16: Issue 143

providers do not need to apply for a license directly, but operators seeking a license must have the gaming software that they use approved by the competent authority, whereby all their suppliers must be mentioned in the license application. Advertising is permitted for all establishments or websites licensed or authorized under the applicable legislation. However, many rules restrict advertising games of chance, in particular in relation to the protection of minors or the fight against addiction. Advertisement for online-gambling websites must be identified as such and contain written or verbal warning messages depending on the platform on which the advertising is offered. If the advertising is offered online, the warning message must contain a link to a website dedicated to the fight against addiction. As in the whole industry, in the recent period many rules on blocking of ISPs and payments of unlicensed operators were introduced. Further to this, one of the recent substantial modifications to the legal status of online operators is the amendment of the Security Code. It now states that online skill games requiring a financial contribution from the player and triggering the hope of a gain are de facto illegal because they cannot be licensed. The main purpose of this amendment is to prevent gambling offers getting around the applicable regulations and banning what were (considered to be) abusive practices. 43

Last Word: Damien Connelly

Digital Transformation


ur operator articles in this issue reinforce the importance of seamlessly integrating your online amenities with your onground amenities. Valley Forge Casino Resort and Ocean Casino Resort have benefited greatly from the digital transformation journeys they have undertaken these last few years … and what they offer their customers is a better (and safer) experience because of that. I say safer because, in my opinion, a licensed onground operator that also offers licensed online gambling (omnichannel) has much stronger relationships with their patrons than an online-only operator. Plus, they have much more at stake should they lose their onground license because they can’t physically relocate their property the way an online asset can seamlessly move around the world. Many European jurisdictions have had legal omnichannel casino gambling for years now. Europe is ahead of the curve and knows more about delivering legal omnichannel casino gambling than any other region – although in fairness to other regions, there remain many European onground casinos that are basically a ‘dark and dismal’ basement space with almost no supporting amenities to provide their patrons anything other than a gambling service. When I visit such properties, I cringe at how backward they are. ‘Backward’ can also be applied to our industry’s use of digital. I have had many discussions over the years with industry players who bemoan the slow speed of change evident across our industry. Sometimes the slow speed of change is driven by an inefficient or overzealous regulator, so it is not always the fault of management playing it too safe (digital payments anyone?). But there are more than a few instances where I have seen the potential for innovation stifled by senior management being risk averse … too focused on defense and not focused enough on offense to even consider trying something new or different. Take as one example, digital communications. I ran the global marketing department for a supplier who is 44

majority owned by Holland Casino (an unusual situation, and one that provided me excellent insight into how both suppliers and operators think). We had our own internal design team (who were, and still are, excellent). We created a digital video advert in 2009. It was, to my knowledge, an industryfirst. It is still delivering value today because I posted it on YouTube and it has had over 22,000 views and growing. I expected our industry would quickly adopt digital video to communicate with target audiences. I was wrong. Operators have adopted digital video much more widely than suppliers. As I look at communications in media and on websites today, especially among suppliers, too much remains static photos and images. If you want digital transformation to happen, you need to walk the talk.

Biography Damien Connelly has worked with some of the world’s largest corporations on business and strategic planning, on creating innovation, and on introducing growth programs, such as with Royal Dutch Shell, Unilever and Vodafone. He’s worked in the casino industry for almost 15 years. His first MA was from Glasgow University in Economics and Management, and his second MA (with Distinction) was from Kingston University in Marketing. He is a professional member of the Chartered Institute of Marketing.

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