Month: November 2022

Boyd took ownership of Pala Interactive and its subsidiaries for total net cash consideration of $170.0m (£147.9m/€171.2m), as per the terms of an agreement reached in March this year.

Founded in 2013, Pala Interactive provides real-money and social gaming solutions on a B2B and B2C basis in regulated markets across the US and Canada. Its B2B services are active in eight US states and in Canada, with B2C offered in New Jersey and Canada.

Pala Interactive’s range of technology includes a player management system, as well as casino, poker, integrated sports, social casino and poker platforms, and managed services.

“Online casino gaming is an attractive growth opportunity for our company, and the acquisition of Pala Interactive provides us with the technology, products and expertise to create a profitable regional online casino business,” Boyd’s president and chief executive Keith Smith said.

“We look forward to working with the Pala Interactive team in executing our online casino gaming strategy, which will complement our existing land-based operations and further expand our nationwide customer base.”

The deal closed earlier than Boyd initially anticipated, with the operators having originally said it expected to complete the acquisition in the first quarter of 2023.

Boyd results

Last week, Boyd announced that the deal was close, upon also posting its results for the third quarter of 2022.

Revenue in Q3 was up 4.1% year-on-year to $877.3m. Of this total, $668. was attributed to gaming operations, with $67.8m generated by food and beverage, and $46.7m hotel, while the remaining $94.8m came from other activities.

Operating costs and expenses were 3.2% higher year-on-year at $639.8m, while after also including $34.1m in financial costs, down 24.1% on last year, pre-tax profit was $203.4m, up 14.1% on Q3 of 2021.

Boyd paid $46.4m in taxes during the quarter, which left it with a net profit of $157.0m, a rise of 13.6% on last year.

Adjusted earnings before interest, tax, deprecation, amortisation and rent costs (EBITDAR) was 0.9% lower year-on-year at $337.7m but was still the second highest total in Boyd’s history, second only to the record figure posted in Q3 last year.

The new gambling messaging was brought in by the Australian Government, in collaboration with the State and Territory governments, along with other updates on customer verification and staff training.

The new gambling advertising framework mandates that all messaging be “nationally consistent” regarding “the risks and potential harm from online wagering”.

This consists of seven taglines that have created to bring attention to problem gambling prevention. At least one of these taglines must be used in all forms of advertising.

Operators can choose between: “Chances are, you’re about to lose”; “Think. Is this a bet you really want to place?”; “What’s gambling really costing you?”; “What are you prepared to lose today? Set a deposit limit”; “Imagine what you could be buying instead”; “You win some. You lose more” and “What are you really gambling with?”

In some cases, the modes of media the advertising is shown on reflects which taglines can be used. TV, video and radio have five taglines available for use. In-app, digital, print, social media and website advertising have six taglines permitted for use.

All taglines are available for direct marketing, sponsorship, promotional, outdoor advertising and stadium advertising. However, “You win some. You lose more” can only be used when it is spoken.

The tagline must also be followed by this call to action: “For free and confidential support call 1800 858 858 or visit gamblinghelponline.org.au”.

The new messaging must be put in place by 30 March 2023. A consultation on the new measures was held between 29 August and 30 October 2022. This week (31 October) marked the formal notification period, where operators were asked to implement the messaging.

A transition period will run between 31 October and 30 March 2023.

Last month, a number of New South Wales sports teams became the latest to opt out of gambling advertising deals, including Western Sydney Wanderers FC and Cricket NSW.

ACMA, which is largely responsible for enforcing the illegal online gambling provisions of Australia’s Interactive Gaming Act (IGA), laid out its strategic focus in a recent report.

The ACMA explained its actions for the July-September period, declaring affiliate services that drive traffic to illegal and offshore offerings while often posing as independent reviewers of gambling sites are its compliance priority.

Subsequently the authority investigated 20 affiliate services during the three-month period in order to “disrupt the marketing and supply” of unlawful offerings in Australia. The investigations found a high number of affiliate services to be in breach of the ban on advertising illegal gambling services under the IGA, and aiding the act of providing illegal gambling.

Enforcement action

The ACMA stated it has taken enforcement action where appropriate. During the process, the statutory authority issued 11 formal warnings to the providers of these unlawful services. Eight of the services implemented measures to prevent Australian residents from accessing the illegal sites and so are compliant with the IGA, nine were blocked by ISP providers at the request of the IGA, while three continue to be monitored.

The body say that the IP blocking has been successful in preventing traffic from Australia, claiming that the blocked sites saw a reduction of between 90-100% of visitors from the country. 

“Our experience is that website blocking has been an effective tool in disrupting (although not preventing) the provision of illegal online gambling and affiliate services to end users in Australia,” said the ACMA in the report.

Illegal offerings

The authority additionally completed 12 investigations involving 25 gambling sites – finding breaches in 10 instances. In total there were 21 examples of sites providing a service that is illegal under the IGA, and 6 for providing an unlicensed regulated service.

As a consequence, formal warnings were issued to 13 operators, and 36 URLs were reported to a “family friendly” filter service.

The ACMA also IP blocked a total of 96 websites during the 3-month period. The work is a continuance of ongoing activities to prevent Australian consumers accessing the illegal offshore offerings.

The news comes in the context of new responsible gambling messaging guidelines introduced as part of Australia’s new National Consumer Protection Framework.

iGB Affiliate London organiser Clarion Gaming said that the theme reflects the role that the show plays in helping affiliates navigate “a period of rapid and accelerated change for the sector”.

Naomi Barton, portfolio director responsible for iGB Affiliate, said affiliates faced a period of major change in terms of both new opportunities and challenges.

“Here Comes the Revolution focuses on the pace of change and the raft of business opportunities and challenges facing affiliates,” she said. “The event, which takes place alongside sister event ICE London provides a unique opportunity for the gaming affiliate community to explore new tactics, new strategies, new partnerships, new sectors and in the process secure new business.

“iGB Affiliate London has a hard-earned reputation for providing the vital partnerships that attract new affiliates as well as knowledge sharing opportunities.”

The plans for the 2023 show comes after the success of the 2022 edition, which attracted visitors from 87 countries.

Of those visitors, 79%, were classed as being “part of the final decision-making process”. In addition, 12% of attendees were new to gaming last year, while 16% represented business less than two years old. 

Surveys of customers also found that 38% of those visitors operated in North America.

iGB Affiliate London 2023 will run from 8-11 February, at ExCeL, London.

To register, click here.

Succeeding Pete Wallis, Smith will take the lead on a number of key business infrastructure projects at EPIC.

Smith joins the consultancy after almost 13 years with the British Army, where she was most recently a life skills developer, having previously been personnel change manager and a commissioned officer in the Royal Military Police.

Prior to this, she spent time as a legal advisor for DWF, a global provider of integrated legal and business services.

“I’ve come into EPIC at quite an interesting point,” Smith said. “There are lots of really tasty projects ongoing and lots of opportunity and potential for the future, so it’s really exciting. I’m super happy to be here, get on board and get involved in the growth of the business.

“What attracted me to EPIC is the passion that everyone has. Passion runs though the company, no matter what level you’re at. Making that difference to people and delivering that impact is really what sold it to me.”

EPIC senior director John Millington added: “We are very pleased to welcome Danielle to EPIC at a time of real growth for the company, not just in the UK but in key global territories like the USA and Australia.

“Her experience and skillset are a perfect fit for the role, and her efficiency and positivity are fantastic traits for someone who will be an important go-to figure for so many pillars within the business.”

NCAA education

Meanwhile, EPIC published an update on its ongoing work within the National Collegiate Athletic Association (NCAA) in the US.

Backed by funding from Entain Foundation US, EPIC has provided a customised education and awareness player protection programme to student-athletes, coaches, game officials, health care personnel, and support personnel, educating them on the risks associated with gambling and sports betting integrity.

To date, EPIC has conducted 158 face-to-face education sessions across 46 colleges in 22 states across the US, reaching as many as 8,000 NCAA collegiate athletes and staff.

“We are pleased this collaboration has reached so many student-athletes,” NCAA executive vice president for regulatory affairs Stan Wilcox said. “The risks associated with sports wagering are abundant, and the education provided by EPIC is invaluable for student-athletes, coaches, administrators and officials. 

“We appreciate the teamwork to help protect the integrity of college sports and the well-being of everyone involved.”

Entain’s senior vice president for American regulatory affairs and responsible gambling, Martin Lycka, added: “Entain Foundation US is proud to support EPIC Risk Management on the face-to-face delivery of problem gambling awareness and player protection workshops to NCAA college-athletes across the country.

“We are glad that the funding provided by Entain Foundation US has helped EPIC, the global leaders in delivery of problem gambling education, to have such a huge impact on one of the highest-risk populations.”

EPIC’s Millington also said: “There is a collective responsibility to ensure the minimisation of potential gambling harms, and the promotion of player safety. Our collaboration with Entain Foundation US represents a key strategic piece of our prevention pillar, and it is great that so many organisations are recognising the importance of education and awareness for this potentially high-risk population.”

The acquisition, agreed in February of this year, includes all P2E’s assets and operations in Virginia, New York and Sioux City, Iowa,

Completion follows the receipt of customary licensing approvals from the Virginia Racing Commission, the New York State Gaming Commission and the Iowa Racing and Gaming Commission.

“Today marks a significant moment in the evolution of Churchill Downs Incorporated,” CDI chief executive Bill Carstanjen said. “This transaction meaningfully expands our geographic footprint to Iowa, New York and Virginia, introducing a very unique set of assets and attractive organic growth opportunities to our company.

“We are excited to welcome the teams from each of these well-established properties into Churchill Downs Incorporated.”

CDI will take ownership of the Colonial Downs Racetrack in Virginia, as well as six Rosie’s Gaming Emporium historical horse racing machine (HRM) sites across the state, including locations in Collinsville, Dumfries, Hampton, New Kent, Richmond and Vinton.

In New York, CDI will assume control of the Del Lago Resort & Casino, a 96,000sq ft casino with approximately 1,700 slot machines and 80 table games, as well as a sportsbook area, 205-room hotel, nine restaurants and bar areas, 758 covered parking spaces, 2,400-seat entertainment venue, and an outdoor event venue.

The deal also covers the Hard Rock Hotel & Casino in Sioux City, Iowa, a 45,000sq ft casino with 639 slot machines with 20 table games, a Hard Rock-branded sportsbook, a 54-room hotel, 1,511 parking spaces and two live entertainment venues.

In addition, the P2E acquisition includes certain development rights, such as the opportunity to develop up to five new HRM entertainment venues in Virginia with collectively up to approximately 2,300 additional HRMs

The opportunity, under Virginia law, to develop up to five additional HRM entertainment venues in Virginia, with collectively up to approximately 2,300 additional HRMs.

CDI may also build a new HRM entertainment venue with up to 1,800 HRMs in Dumfries, Virginia, with the initial phase expected to open in 2023. CDI will also have the rights to develop a new HRM entertainment location with up to 150 HRMs in Emporia, Virginia, the first phase of which is due to open next year.

In addition, CDI will be able to pick up P2E’s ongoing efforts, in partnership with Urban One, to develop ONE Casino + Resort, a $565.0m destination casino in Richmond, Virginia.

Completion of the acquisition comes after CDI last week reported record adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) in its third quarter. EBITDA for the period reached $163.2m, up 4.6% year-on-year.

However, revenue was 2.5% lower year-on-year at $383.1m, while net profit amounted to $57.0m, down 7.2% on last year.

The operator has received licensed approval for all kinds of online gaming, including online sports betting, under the Isle of Man Online Gambling Regulation Act.

Former FanDuel executives Varun Sudhakar, Stuart Tonner and Nigel Eccles serve as CEO, CTO and chairman of the new business, which they founded just over a year ago. Soon after founding, BetDex announces an initial investment round, raising $21m.

Varun Sudhakar, CEO and co-founder of BetDEX said: “Today’s news is an exciting step forward for the BetDex Exchange. With the licensing and regulatory approval, BetDex now boasts the first fully-regulated sports betting platform in the web3 space, and we’re excited to welcome bettors from approved regions.”

Abby Kimber, head of egaming with the Isle of Man Government, said: “It is a pleasure to welcome BetDex to the island. We are excited to be at the forefront of technologies like blockchain while maintaining our reputation as a highly regulated jurisdiction that prides itself on player protection. I wish BetDex every success with their future ventures and look forward to partnering with them for many years to come.”

The exchange just entered Open Beta, accepting wagers from more than 12,000 early access players in the past weeks. It accepts wagers from select countries throughout South America, Europe, Asia, and Africa. The BetDEX Exchange currently offers peer-to-peer sports wagers on soccer and is expecting to announce additional sports in the near future.

Under the deal, William Hill will become the team’s official in-stadium betting partner and operate retail betting facilities inside the club’s Celtic Park home.

The arrangement will run for two years, with fans able to place range of bets and also take advantage of exclusive offers and promotion on Celtic home matchdays. 

“We are delighted to partner up with Celtic at their iconic home and deliver our unrivalled retail betting experience to the Celtic faithful,” William Hill’s director of media, sponsorships and UK creative, Liam McKee, said. It promises to be another exciting season at Paradise, and we are thrilled to be along for the journey.”

Celtic’s commercial director Adrian Filby added: “We are very pleased to be partnering with an industry leader in William Hill. We are certain that supporters who use this service will benefit from an enhanced stadium experience throughout the season.”

Celtic currently sit top of the 2022-23 Premiership with 33 points, four points ahead of Rangers in second, having won 11 of 12 matches so far this season.

The person, who the KSA did not name, was featured in TV and online ads for the NPL’s “Deal or no Deal” lottery game. The regulator emphasised that the law outlines that even providers of less risky verticals must still ensure that the figure does not have youth appeal.

It said that the postcode lottery did not do this.

“If they want to use a famous Dutch person in an advertisement, providers of less risky games of chance, such as lotteries, must investigate the reach of that person among minors and young adults,” said the KSA. “If this is substantial, the role model may not be used in advertisements. Because young people are vulnerable to developing gambling addiction, they need extra protection.”

While NPL did not initiate an investigation until the organisation was requested to by the authority, the regulator established to its own satisfaction that the person indeed had “a substantial reach” amongst young people – and that the NPL was wrong in using the individual for its promotional activities.

Evidence of the person’s reach to young people included the size of their social media presence, in which the person had 200,000 Instagram followers, more than 100,000 TikTok followers and more than 20,000 Facebook followers. In addition, the television programmes on which the person had presented or otherwise been featured on were shown to have substantial viewing figures in the under-25 demographic.  

Role model ban

The KSA could have issued a penalty fine to the NPL but settled on a warning instead. This was due to the particular circumstances of the case, and the fact that the case pre-dated reform to the law on 30 June. With the updated law, further guidance was introduced about the definition of a role model.

The role model ban was announced in March, when the Dutch minister for Legal Protection Franc Weerwind announced the measure as part of a suite of measures designed to counter gambling advertising.

“I’ve also been in talks with addiction treatment centres,” Weerwind had said at the time. “They have told me that the sheer volume of gambling advertisements leads to unrest among recovering addicts and problematic gambling among people who identify with the role models appearing in the ads. That was a reason for me not to wait.”

The European Commission carries out periodic supra-national risk assessments, determining the risk of money laundering and terrorist financing across the European Union in various sectors. The 2022 edition is the third such risk assessment, after previous versions in 2017 and 2019.

“As with the previous reports, this third edition analyses the present ML/TF risks and proposes comprehensive action to address them,” the European Commission said. “It also assesses the degree to which the Commission’s recommendations for mitigating measures in the 2019 report have been implemented and evaluates the remaining risks.”

One area of particular focus in the report was gambling, with each gambling vertical receiving its own risk assessment.

Online gambling was found to be especially vulnerable money laundering and terrorist financing, with this risk being classed as “very high”, the highest possible risk level.

“Despite several risk-based measures already being implemented by many EU online operators (for example anti-money laundering training sessions for employees, customer due diligence and ‘know your customer’ processes), the exposure to money laundering risks in online gambling is still rather high as it encompasses significant factors such as the non-face-to face element, huge and complex volumes of transactions and financial flows,” the European Commission said.

The body added that digital currencies are one feature that can make online gambling especially vulnerable to money laundering.

“Although not based on cash, it is closely connected to the use of e-money, and digital and virtual currencies which, for example, also increases the degree of anonymity for customers,” it said.

Self-regulation

The Commission also said in many markets, operators have self-regulated with a reasonable degree of success, but authorities have been lacking in providing the industry with clarity.

“In many member states online gambling operators have developed a good level of self-regulation and risk assessment, although their cooperation with competent authorities and financial intelligence units could be improved,” it said. “Operators believe that they do not get clear guidance on how to properly address the risks considering, in particular, the lack of feedback from financial intelligence units on suspicious transaction reports.”

The Commission also had a number of recommendations for EU member states. 

This included “promoting a lower threshold of winnings subject to customer due diligence” than the current €2,000 winnings threshold.

Other recommendations included that “member states should ensure that online gambling operators organise regular training sessions of the staff and compliance officers on a regular basis” and that they should ensure players cannot hold multiple accounts with the same brand.

Land-based casino and money laundering

On the other hand, land-based casinos were an area where the Commission noted a major improvement. Having been rated as being of “very high” vulnerability in 2019, the classification was dropped to “medium” in 2022.

It said the biggest risks for money laundering at a casino involve “infiltration”: staff members that are connected with money laundering schemes. However, it added that fit-and-proper person tests have helped to reduce the risk.

“Casinos are considered to be exposed to infiltration risks, although for casinos owned by the state or public companies, this level of risk is lower,” the Commission said. “Hence, the risk of casinos being exploited to money laundering appears high, and the level of the threat posed by money laundering to casinos is considered as moderately significant.

“Despite an overall good picture, law enforcement agencies are still identifying some weaknesses, which suggests that the current legal framework is not correctly applied. The number of money laundering cases investigated by law enforcement agencies seems to show that there is still room for improvement.”

The Commission added that the inclusion of casinos on the EU-wide AML/CFT framework has had a “mitigating effect” on the risk of money laundering at these venues.

“The inclusion of casinos in the list of obliged entities in the 4th Anti-Money Laundering Directive, as well as in earlier EU AML legislation, has undoubtedly played a role in the quality of the checks in place,” it said. “It appears that, overall, casinos manage to address the need to put in place several layers of checks, knowing that most of the time several gaming activities may be played in a casino.”

Elsewhere, the risk of money laundering in poker and retail betting was considered to be “high”, while for lotteries and gaming machines outside of casinos it was medium. For bingo, the risk was classed as low. These ratings were all the same as in 2019.

FATF action

The new assessment comes after global anti-money laundering body the Financial Action Task Force has cracked down on gambling hubs. In 2021, it added Malta to its “grey list” of jurisdictions under increased monitoring.

While Malta was removed from the list earlier this year, Gibraltar was added at the exact same time, with the body specifically citing a lack of potent fines against the gambling sector for failings as a key reason for its grey listing.

Earlier this month, the task Force revealed that Gibraltar had deferred its FATF reporting, and said that it still hoped to see the territory impose more fines.