LV Bear Denounces MGM Grand AGAIN!

The Bear Growls: MGM Grand and Gaming Control Board conspire to harass patron trying to cashing chips

Long-time Las Vegas-based advantage player, casino critic, and frequent BJ21.com contributor LVBear offers his opinions on things that sometimes go wrong in the world of casinos.

By LVBear
[email protected]

The news article Chips no longer good as cash details the policy of MGM Grand of hassling patrons who are cashing $5000 chips. Based on published reports, MGM Grand has refused to cash chips for winning patrons more times than any other casino. If Nevada had a legitimate Gaming Control Board, this despicable practice would have been stopped long ago. The MGM Grand should have been heavily fined and the individual employees responsible for this harassment of patrons should have been fired and banned from the gaming industry. Unfortunately, the Chief of Enforcement, long-time industry hack Jerry Markling misstates the facts. I don’t know if Mr. Markling is really as ignorant as he sounds in the following quote, or if he is simply corrupt:

"Initially the burden of proof is on the person with the chip to show how he obtained it through legitimate means," said Jerry Markling, chief of the Gaming Control Board's enforcement division. But if the chip is seized and the customer complains to state regulators, the burden shifts to the casino to prove its case.

The patron has no such burden. Marling obviously knows this; he lied to the reporter. The regulation in question is Nevada Gaming Regulation 12.060 (Archive copy), which states in pertinent part:

4. A licensee shall not redeem its chips or tokens if presented by a person who the licensee knows or reasonably should know is not a patron of its gaming establishment …

Clearly this burden is on the casino, not the patron. Markling cannot possibly be ignorant of this fact. From that, I must conclude that he deliberately lied to Las Vegas Sun reporter Liz Benston to protect the casino industry, which has a vested interest in harassing winning players. I can’t think of any other rational explanation for his false statement. It is unfortunate that Ms. Benston, who is usually a good, thorough reporter, apparently did not follow up or challenge Mr. Markling's false statement.

In Beat the Players, Bob Nersesian wrote:

An occurrence within Nevada is gaining some prevalence. When a patron presents a high value of chips, some casinos are confiscating these chips and returning a receipt rather than legal tender. The excuse given is that per regulations they can pay only patrons, and the person presenting the chips is not known as a patron. The incidents increase with the value of the chips, and high value chips such as chocolate ($5000) chips draw instant scrutiny.

With this said, the compliance with this rule may prove difficult. If a cashier wants to get higher level approval, demand that the chip(s) remain with you. If the manager demands to examine the chip, have him come outside the cage. Ideally, before the chip(s) are given up, see the green counted out on the counter, and if the cashier makes any move to absent themselves with the chip, demand that it be returned and that any inquiry take place face to face with you having access to your chip(s). If there is any question, simply inform the cashier or supervisor that you have read of casinos just taking chips from players, and that you are protecting against this occurrence. Also, inform them that possession of the chip has nothing to do with determining whether or not you are a patron. Of course, if you are a player with a player’s card that supports the win, all of this becomes largely moot because you will very likely be paid and told “Thank you.”

On a different level, avoid the high denomination chips. This, of course, is harder than it may appear. Protecting goodwill and anonymity may well turn on willing compliance with requests of the pit boss or dealer. Demands to color-up can be direct and almost oppressive. Indeed, a dealer or pit boss can make it sound like you have no choice.

Still, quickly standing, pocketing the chips on the table, and walking away can suffice. Alternatively, limiting a payout to blacks may occur on a statement that you are just going to another table. I have also seen chocolate chips avoided by a patron stating that he would never want to carry a $5000 bill, and certainly doesn’t want to carry a $5000 chip. The smaller the denominations, the easier it will be to leach out full payment without inquiry. If the casino ever gets its hands on one or more of these big chips, you have bought a gaming dispute with all its attendant disclosure requirements, and the corollary loss of anonymity with respect to that casino. This is obviously a result to be avoided.

There is also the question as to why the casino can take the chip and not pay. There are conflicting laws on this, and that presents the difficulty. First, chips are expressly defined in the regulations as a “representative of value issued by a licensee.” More importantly, once issued, the chips “evidence a debt owed to their custodian.” The regulation expressly states “custodian,” thereby rendering chips a bearer item. The regulation does not say “patron,” does not say “customer,” and does say “custodian.” Thus, chips represent a debt owed by the casino to the person in custody of the chips.

Against this clear statement of a debt, there is a conflicting provision that states, “A licensee shall not redeem its chips or tokens if presented by a person who the licensee knows or reasonably should know is not a patron of its gaming establishment . . .”. So, the end result is that it is possible to have a non-patron who is owed an express legal debt by the casino, but the casino has a corresponding duty to not redeem those chips. This truly appears to be an irresolvable conundrum under the law.

Still, the proscription is that the casino “not redeem” the chips. There is no right, implied or express, that the casino may confiscate this representation of a debt owed to the custodian. It appears that the casino, if it knows that the presenter is not a patron, is restricted to telling the presenter that they cannot redeem the chip from him. The obvious way around this is to give the chip to a “patron” in order that the “patron” can redeem it.

I would also suggest that the burden under the regulation allowing for a refusal to redeem is on the casino. Note that the language says that the casino cannot redeem a chip from someone that they “know” or “reasonably should know” is not a patron. First, if the presenter is a “patron,” then there is no excuse whatsoever for failing to redeem. If you could ask the casino a question such as, “How do you know that I am not a patron?”, and no answer can be given, then the casino is obviously outside the regulation in refusing to redeem. Maybe carrying a copy of Nevada Gaming Regulation 12.060, showing it to the cage boss, and pointing out the unsuitable practice of refusing to redeem could result in prompt payment. When the gaming agents arrive, do the same. Again, it is the casino’s burden, and if such a course is taken it should be repeatedly pointed out that you don’t have to justify or prove yourself as a patron, the casino has to prove you aren’t or weren’t.

You might even walk over to a machine, put in a quarter in front of the cage personnel, and say, “Now I’m a patron, pay me.” The regulation does not restrict the redemption of chips to persons who have received the chips through means other than play, but to non-patrons. In this respect, the direct language clearly says that if you are a “patron,” then the casino must promptly redeem their chips from you.

Another factor playing on this is the legal status of how you hold the chips. While you may be cashing the chips for another advantage player, the law of contract and the common law generally, allow for the free assignment of contract rights. Likewise, evidence of indebtedness is freely assignable. As an assignee of the “patron,” you take on the status of the “patron.” This should include the “patron” status under principles of assignment. Another factor playing into this scenario is that persons in society are allowed to use agents to conduct their business. This includes agents for undisclosed principals. The agent stands in the shoes of the principal. If the principal is a “patron,” then redemption should occur on presentation by an authorized agent. Again, the burden is with the casino to show that they know or reasonably should know that the presenter is not a “patron.”

The Nevada Gaming Control Board has again shown its worthlessness and lack of integrity. Clearly the MGM Grand should be punished for its illegal bullying tactics. I hope that one of the victims eventually is willing to go forward with legal action, perhaps forming a class action lawsuit on behalf of all patrons who have been similarly victimized. The challenge will be to remove the matter from the jurisdiction of the Gaming Control Board, where we all know nothing will be done to punish the wrongdoers. In civil court, where the victim still has an uphill battle in Nevada, at least there is a reasonable chance of prevailing, and a jury awarding appropriate damages against MGM Grand for its continuing despicable conduct.

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In 2005 LV Bear collaborated with me on this subject for a Tribune cover story. zg


MGM, Others Abuse Patrons' Rights

By Marcus K. Dalton
Tribune Media Group / August 11, 2005

In a recent open letter to the Review Journal, Las Vegas attorney Robert Nersesian wrote: "Nevada's casino industry continues to act as if it is above the law. Time and again, patrons legally playing ... suffer imprisonment and even beatings at the hands of casino security personnel. It's well past time that something be done to stop these incidents."

Abuse of casino patrons' rights in Southern Nevada is actually more widespread than is commonly acknowledged.

Consider the case of Richard Chen. On March 9, 2000, the Nevada Supreme Court ruled 3-1 that the Monte Carlo Casino had to give Richard Chen the $40,400 he won by counting cards at blackjack. From the objective view of the law, if there is such a thing, card counters are merely players who have enough skill to beat casinos at their own game.

A close look at the Chen decision shows how precarious the legal rights of casino patrons actually are. Chen initially obtained $44,000 in chips as he was losing during the course of his initial days of play. Then the pendulum swung the other way and be gan to win. By the time he had accumulated a total of $84,400, it was discovered that he was a known card counter. So, the Monte Carlo refused to pay. Chen, having won money legitimately nevertheless had to go to the State's highest court to collect.

Not isolated events

Think that Chen's case is a remote or isolated occurrence in the Southern Nevada casinos, including those owned by the MGM consortium? Think again.

Last Month a player won $8,600 at blackjack at the MGM Grand but when he attempted to redeem his chips he was denied his winnings and even his initial buy-in. The player, who wishes to remain nameless, holds a Ph.D. from Stanford University and works at an ivy league university on the east coast.

"After playing at the MGM Grand without being rated, and winning a large amount, the cage then refused to cash my chips, and gave me a receipt for them instead, on the grounds that because I was not known to them, having played without a comp rating, they have no record of my play. From what the shift manager said to me when he told me the decision, it is obvious that they know who I am, know I am a skilled blackjack player, and are acting on the premise that strong players are fair game for being cheated and harassed by their casino," said the Stanford Ph.D.

The Tribune spoke with gaming legal experts Al Rogers and Bob Nersesian, and both told us that they know of several other cases in which the MGM Grand did this to exceptionally strong blackjack players. In previous cases, after filing complaints with the Gaming Control Board, the victims eventually got their money, but the MGM Grand was not penalized in any way which obviously gives the MGM Grand no incentive to discontinue this abuse.

Several Las Vegas lawyers say there is an emerging pattern of intimidation and excessive force, with casino security, state gaming officers and the Metropolitan Police Department often working in concert to trample constitutional rights, civil liberties and gaming regulations to deter advantage gamblers from playing at local properties.

The problem has been emerging from the backrooms of casinos into wider public view through a bevy of legal cases in Las Vegas in which advantage gamblers have sued casino-hotels, Gaming Control Board agents, and even Metro officers after they have had their winnings confiscated or been detained and roughed up by security and police officers and even charged with unrelated minor offenses.

One who understands this is Las Vegas attorney Bob Nersesian, who represents several advantage players who charge that their civil rights have been violated in casinos in recent years.

In a November 2004 article entitled "Bringing Down The House, Las Vegas Mercury author Bob Shemeligian quotes Nersesian and reviews some of the attorney's cases against casino abuse: "The casino is at war with everybody - every single player," Nersesian says. "Every day, the casino wins the war against the average casino patron. They do this by winning from the patron. But when it comes to their war against advantage players, I would suggest the casino uses tactics not approved by the Geneva Convention."

And don't think that the smaller "local" establishments and regular "non-advantaged" patrons are immune to this obnoxious and illegal behavior. Recently the Tribune learned of allegations of several violations involving the Tuscany Suites Casino on Flamingo Road.

Last month Mary Miller checked into the Tuscany Hotel and then proceeded to the bar where she played video poker. According to Miller, she began to pile up winnings in the machine, "several hundred dollars, very lucky," she said. "As my winnings accumulated the security guard became increasingly interested and then finally told me I had to leave."

Miller claims she was not drunk or belligerent, but she was incredulous towards the Tuscany security guard, not understanding why she would be asked to leave when winning.

Ultimately, Miller was handcuffed and detained, her winnings were confiscated without a receipt, and then she was packed out and ejected from the property without even a refund of the hotel fare she had paid only two hours earlier. When her attorney requested a copy of the security report and the video surveillance, none was forthcoming.

The Tribune has learned that Miller's Tuscany experience is not uncommon to that property. According to Tribune sources earlier this year a craps player who was ahead several thousand dollars had an almost identical experience to Miller's. Further Tribune has witnessed, first hand, illegal table-game sidebets being blatantly promoted at Tuscany.

Gaming Control enabled?

In a July 22nd Tribune commentary, noted gaming expert L.V. Bear wrote: "What should be frightening and infuriating to Nevadans is that the outrageous activity by casinos is tolerated by the Nevada Gaming Control Board. If there was to be a vote for least effective public agency, the Gaming Control Board would win easily. It appears to be corrupt from top to bottom, operating as a de facto arm of the casino industry, instead of protecting the public from casino wrongdoing. The Gaming Control Board is little more than a training ground for future casino employees. The current Board is a see-no-evil, hear-no-evil trio of two undistinguished career bureaucrats and a casino-industry attorney who cater to every whim of the casino bosses, and do little or nothing to protect the public."

Publicized cases of casino cheating underscore an apparent mentality of the Nevada Gaming Control Board itself. When the Venetian was caught rigging promotional drawings for the benefit of certain Asian high-rollers, Gaming Control fined it a million dollars, which is a petty slap on the wrist for the Venetian. The crooked employees should have been referred to the District Attorney’s Office for criminal prosecution. Not only was that not done, the Gaming Control didn’t even see fit to revoke the gaming licenses of the perpetrators
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In a more recent case, the Golden Nugget refused to pay $48,600 on a winning sports bet. The Golden Nugget said it simply would not pay the winner, though it would refund the $2700 bet. The Gaming Control Board ordered the Golden Nugget to pay the victim, but assessed an absurdly small monetary penalty of less than $30,000. Again, no casino employee was prosecuted for trying to cheat a patron, and the fine, actually imposed for failure to notify the Board of a “patron dispute,” was so small as to be ridiculous. And, the outright attempt to cheat a patron of his winnings was labeled a “patron dispute.”

L.V. Bear lays the blame thoroughly at the feet of Gaming Control, noting the case of a computerized tracking device that the Eldorado Casino was utilizing to illicitly improve their profits (i.e., cheat) at blackjack: "The Board had to be sued before it agreed to take action to stop [the Eldorado's] cheating at blackjack, through a computerized table that uses marked cards. Incredibly, the Board has permitted the continued use of the marked cards, but has made it less easy, though not impossible, for casinos to use the device to cheat patrons. The Board refuses to publicly disclose a copy of the anti-cheating orders it claims to have issued. Without the embarrassment of being sued for refusing to do its job, the Board would likely have continued to do nothing while the cheating went on unabated."
Unfortunately, Gaming Control has the ability to operate largely in secret. A few ill-conceived statutes allow it more secrecy than a regular police department. Most of its files are not considered public records, and are not available for public inspection. Most of its business is conducted via secret deals with casino bosses. Of course, the secret sweetheart-deal making works to the advantage of the Board, its employees and the casino bosses, and to the detriment of the public.

"The present Gaming Control Board is an out-of-control, corrupt government agency operating in virtual secrecy. Legislation is needed to force it to open its files and records to the sunshine of public scrutiny. If after public examination of its practices, it is determined to unsalvageable, it should be disbanded, its employees fired from the public payroll, and a new agency created," says Bear.

"Nevada does not need another cheating scandal or another abuse-of-patrons scandal in its casinos. There have been far too many already, with no meaningful action ever taken against the wrongdoers. Nevada is competing with many other gaming and vacation destinations. The other states take casino cheating and other wrongdoing seriously. Nevada needs to start doing the same, before it is too late. Once we get a national or worldwide reputation for not having legitimate, effective government oversight of casinos, many of the tourists -- the lifeblood of our economy -- will stop taking the risk of visiting Nevada," concludes Bear.


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