Station Casinos fined $80,000 in “nuisance value” for accepting past-posted sports wagers

June 27, 2022 10:05 AM
Photo: Shutterstock
  • Buck Wargo, CDC Gaming Reports
June 27, 2022 10:05 AM
  • Buck Wargo, CDC Gaming Reports

The Nevada Gaming Commission Thursday signed off on a settlement for Station Casinos to pay an $80,000 fine for accepting some 348 sports wagers on its wagering app after the events were played over a three-year period between 2018 and 2021.

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The problem, about which Station Casinos alerted the Gaming Control Board on each occasion, is attributed to problems with its third-party Stadium Live software; those issues still haven’t been resolved and continue to recur. Station Casinos is in the process of trying to replace the software with a company that’s yet to be licensed in Nevada.

Station neither admitted nor denied the allegations in the complaint filed by the Gaming Control Board, but acknowledged it failed to maintain its virtual servers on which the Stadium software operated its sports-wagering app, according to John Michela, senior deputy attorney general for the Board. Station Casinos was required to have redundant monitoring to keep the problem from recurring, he said.

Station Casinos Attorney Marc Rubinstein told the Commission that a flaw in the software that triggered the servers filling up more quickly than anyone had anticipated, freezing the system. He cited other licensees facing similar problems and that regulators aren’t holding Stadium accountable for the software flaw, which he said vindicated their position that a complaint shouldn’t have been filed.

All of the wagers were voided and money was refunded to customer accounts.

“We settled it for a nuisance value, because it would be expensive to litigate,” Rubinstein said. “As frustrating as it was for the Board to hear about this again and as aggravated as the Enforcement Division might have been to deal with this again, this was a violation with no harm to anyone.”

Commissioner Steven Cohen responded that there is harm anytime wagers are voided and it’s important to protect the integrity of the system.

Rubinstein took aim at Stadium, bettors and the Gaming Control Board itself.

“We have always accepted some culpability,” Rubinstein said. “Our objection is that there are other folks that contributed to this and we want everyone to recognize that. It’s not just Stadium, but the customers who knew the events were over and fired away anyway. They’re not necessarily innocent either and to some extent, the Board in their relationship with Stadium could have done more as well in trying to come up with a better remedy.”

When the problem was discovered, Rubinstein said Station Casinos thought it could jerry-rig a workaround in the software by setting an alarm in each drive in the server; when it became 85% full, someone would be notified a loss of memory might be imminent. Since then, there was an unalarmed drive and wagers were accepted after the outcome of the events were determined, he said.

It’s taking Station Casinos time to replace the software, as only a few sports-betting systems are approved in the state, Rubinstein said. If Station went with a system that’s approved, it would be dealing with a competitor, he said. He said they’re doing the best they can.

“Insofar as there have been subsequent incidents (since March 2021) involving failures of the Stadium software that led to other past-posting incidents, that’s on Stadium,” Rubinstein said. “What we’re doing is trying to move away from Stadium as quickly as we can, but we frankly don’t know the inner workings of the Stadium software or the nature of the flaw. We have to live with the possibility that this could recur. It did in January and March of 2022. The March incident, as we have been advised by Stadium, affected multiple licenses and not just Station.”

The complaint filed by the Board in September said that on June 1, 2018, Station accepted money and wrote 35 wagers covering five events after the outcomes had been determined.

On Jan. 9, 2019, Station’s mobile sports-wagering system accepted money and wrote tickets on 116 sports wagers after the outcomes were known.

On March 7, 2019, Station accepted 30 wagers, in which at least three of the outcomes were known.

On March 18, 2021, Station reported to the Control Board a malfunction of its Stadium Live sports wagering system in which it accepted 167 tickets on events whose outcomes had already been determined.

Michela said other incidents for writing wagers after an event involved former Nevada operator CG Technology. It was fined $1.5 million in 2016 and $1.75 million in 2018 over that and other issues in its history. It was ordered to replace its sports-betting system and make management changes.