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Predictions for the Indian Gaming Industry in 2019

Jan 16, 2019
By: Grant Eve

Tribal gaming industry

An exciting year awaits gaming in 2019 thanks in part to changes in regulations and continued rapid changes in technology. With the Professional and Amateur Sports Protection Act (PASPA) declared unconstitutional in May, states can now establish their own regulated sports betting. Many states have already passed or are working on legislation for sports gaming. Illegal sports betting is a multibillion-dollar racket in the United States, and now that states, commercial operators and tribes can bring legal sports betting to their jurisdictions, what was once a racket is being transformed into a legal, regulated market with large profit potential. How it is regulated, and the fees involved, will be important items to monitor this year. Corruption, both internally and externally, have been raised as concerns.

Outside of Nevada, this is “new business” for the U.S., and regulatory challenges will occur, including issues surrounding regulatory fees, Title 31/AML compliance, corruption and bribery, payment processing, identity theft (mobile betting) and banking considerations. Fortunately, regulators have a world of experience to draw upon, gleaning intelligence from jurisdictions around the globe where sports betting has been legal for decades.

In November 2017, the U.S. Department of Treasury named Kenneth Blanco as Director of the Financial Crimes Enforcement Network (FinCEN). Bringing 28 years of prior prosecutorial experience, Blanco personally addressed the casino industry in August 2018, sharing the agency’s focus on four areas of importance for casinos. They include understanding the value of the Bank Secrecy Act data, using information to ensure compliance, increasing information-sharing through the 314(b) program, and the importance of understanding cybersecurity and emerging payments. Given this insight, the industry can expect increased Title 31/AML scrutiny at the federal level, especially facilities considering sports betting.

With both the expected opportunities and challenges, growth in tribal casino revenue for 2019 should continue, albeit modestly. The Indian gaming industry experienced solid revenue growth in 2017, as announced by the National Indian Gaming Commission this past summer. The commission reported an increase from $31.2 billion to $32.4 billion in gross gaming revenue — an increase of approximately 4% and further reflecting an increase of 10 added facilities in 2017.

Additional revenue growth in 2019 will come from a strong economy, from the addition of amenities and services and from a few tribal casinos that are expected to gain significant revenue, such as Wilton Rancheria’s $500 million project in Elk Grove, California, managed by Boyd Gaming. In addition, Oklahoma passed ball-and-dice games in 2018, and some of the state’s tribal casinos have already brought the games to their facilities. With 2019 as the first full year of ball-and-dice games, it will be worth monitoring Oklahoma gaming revenue in the coming year.


Grant Eve, CPA, CFE
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