cut and pasted this from eog front page. is this true?
Luckys Race and Sportsbook Could Be Insolvent
February 10, 2009
Request for emergency audit of Lucky’s Race & Sportsbook; possible violation of Regulation 22.040: Reserve requirements, and other regulations
It appears that this licensee is frequently operating without sufficient money on hand to pay winning patrons, in apparent violation of Regulation 3.050.1, which states:
No license will be issued for use in any establishment until satisfactory evidence is presented that there is adequate financing available to pay all current obligations and, in addition, to provide adequate working capital to finance opening of the establishment.
There have been at least five incidents within the last thirty days of Lucky’s at Plaza Las Vegas and Lucky’s at Terrible’s Las Vegas being unable or unwilling to promptly pay winning patrons. Patrons have had to wait as long as eight hours to get paid. In at least one case known to me, a patron was asked to return to Plaza in “a couple of days” to get paid. One patron at Terrible’s was told to “mail in your ticket if you want to get paid.” He subsequently was paid after Board intervention. Most of these failures to promptly pay were for relatively small amounts, no more than four figures. It is hard to understand a sportsbook trying to operate with less than $10,000 in cash on hand to pay winning patrons.
In addition, there has been an apparent attempt by Lucky’s to cheat a patron by deliberately misgrading a Super Bowl prop in favor of the side that had the least action. The resulting patron complaint is presently being handled by Agent Willie Waters.
The totality of circumstances would indicate that Lucky’s simply no longer has adequate capital to operate, and may now be essentially operating a Ponzi scheme, transferring a day’s incoming revenues to other locations to pay off previous winners. If this is correct, and is allowed to continue, the damage to patrons and the embarrassment to the industry and the State of Nevada will be significant when the scheme eventually unravels.
Action by the Board pursuant to Regulation 3.050.2 would appear to be appropriate:
The commission or the chairman of the board may require a licensee to provide security in the form of a reserve for the payment of all amounts held by the licensee on the patrons’ behalf, all amounts held by the licensee for the account of the patrons, all amounts owed by a licensee but unpaid to gaming patrons, future wages, salaries or other obligations, either as a condition precedent to issuance or renewal of any license or at any other time the commission or chairman determines that such requirement would be in the public interest. The security required shall in all respects, other than amount, comply with the requirements and provisions of the reserve made applicable to race books and sports pools by Regulation 22.040.
Of particular relevance is Regulation 22.040.8:
A book must calculate its reserve requirement each day. In the event a book determines that its reserve is not sufficient to cover the calculated requirement, the book must, within 24 hours, notify the chairman of this fact in writing and must also indicate the steps the book has taken to remedy the deficiency.
Based on the frequency of delayed payments, it is reasonable to suspect that this regulation is not being complied with by Lucky’s. Otherwise, there would be sufficient cash on hand at its locations to pay winning patrons, unless it lacks the cash, in which case it is in violation of the reserve requirement itself.
The circumstances causing Lucky’s recent mistreatment of winning patrons cry out for a Board investigation. Please initiate it as quickly as possible and advise.
Nevada Gaming Control Board
Enforcement Division
555 East Washington Avenue #2600
Las Vegas, Nevada 89101
Luckys Race and Sportsbook Could Be Insolvent
February 10, 2009
Request for emergency audit of Lucky’s Race & Sportsbook; possible violation of Regulation 22.040: Reserve requirements, and other regulations
It appears that this licensee is frequently operating without sufficient money on hand to pay winning patrons, in apparent violation of Regulation 3.050.1, which states:
No license will be issued for use in any establishment until satisfactory evidence is presented that there is adequate financing available to pay all current obligations and, in addition, to provide adequate working capital to finance opening of the establishment.
There have been at least five incidents within the last thirty days of Lucky’s at Plaza Las Vegas and Lucky’s at Terrible’s Las Vegas being unable or unwilling to promptly pay winning patrons. Patrons have had to wait as long as eight hours to get paid. In at least one case known to me, a patron was asked to return to Plaza in “a couple of days” to get paid. One patron at Terrible’s was told to “mail in your ticket if you want to get paid.” He subsequently was paid after Board intervention. Most of these failures to promptly pay were for relatively small amounts, no more than four figures. It is hard to understand a sportsbook trying to operate with less than $10,000 in cash on hand to pay winning patrons.
In addition, there has been an apparent attempt by Lucky’s to cheat a patron by deliberately misgrading a Super Bowl prop in favor of the side that had the least action. The resulting patron complaint is presently being handled by Agent Willie Waters.
The totality of circumstances would indicate that Lucky’s simply no longer has adequate capital to operate, and may now be essentially operating a Ponzi scheme, transferring a day’s incoming revenues to other locations to pay off previous winners. If this is correct, and is allowed to continue, the damage to patrons and the embarrassment to the industry and the State of Nevada will be significant when the scheme eventually unravels.
Action by the Board pursuant to Regulation 3.050.2 would appear to be appropriate:
The commission or the chairman of the board may require a licensee to provide security in the form of a reserve for the payment of all amounts held by the licensee on the patrons’ behalf, all amounts held by the licensee for the account of the patrons, all amounts owed by a licensee but unpaid to gaming patrons, future wages, salaries or other obligations, either as a condition precedent to issuance or renewal of any license or at any other time the commission or chairman determines that such requirement would be in the public interest. The security required shall in all respects, other than amount, comply with the requirements and provisions of the reserve made applicable to race books and sports pools by Regulation 22.040.
Of particular relevance is Regulation 22.040.8:
A book must calculate its reserve requirement each day. In the event a book determines that its reserve is not sufficient to cover the calculated requirement, the book must, within 24 hours, notify the chairman of this fact in writing and must also indicate the steps the book has taken to remedy the deficiency.
Based on the frequency of delayed payments, it is reasonable to suspect that this regulation is not being complied with by Lucky’s. Otherwise, there would be sufficient cash on hand at its locations to pay winning patrons, unless it lacks the cash, in which case it is in violation of the reserve requirement itself.
The circumstances causing Lucky’s recent mistreatment of winning patrons cry out for a Board investigation. Please initiate it as quickly as possible and advise.
Nevada Gaming Control Board
Enforcement Division
555 East Washington Avenue #2600
Las Vegas, Nevada 89101
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