Cantor to pay $5.5 million to settle illegal sports-betting complaint

A view of Tropicana’s sports book, May 24, 2011. It is operated by CG Technology, formerly known as Cantor Gaming.

The sports book management company accused of lax supervision of its employees in connection with an illegal bookmaking operation would be fined a record $5.5 million under a proposed settlement with the state.

State Gaming Control Board Chairman A.G. Burnett today confirmed the amount of the proposed fine against CG Technology, formerly known as Cantor Gaming. The board’s 18-count complaint outlining the charges against CG Technology was made public last week and will be considered by the Nevada Gaming Commission at its Jan. 23 meeting.

“I think the level of this fine sends a strong message to the industry that we take allegations of this kind very seriously,” Burnett said today.

If approved, the fine would be the highest ever levied by Nevada gaming regulators against a licensee. The board could have recommended revoking or suspending the company’s license.

In the complaint made public Jan. 6, regulators said CG Technology failed to prevent Michael Colbert from operating an illegal sports wagering ring that made an estimated $34 million in bets. Colbert, formerly director of risk management and vice president of what was then Cantor Gaming in Las Vegas, worked with three men who worked as messengers to place wagers for Gadoon Kyrollos, a high-level sports bettor.

Colbert pleaded guilty to one felony count of conspiracy for his role in the betting ring in a New York federal court last year. He’s awaiting sentencing. One of the messenger bettors, Paul Sexton, pleaded guilty to fourth-degree money-laundering and forfeited $600,000, according to the state’s complaint.

The proposed settlement says CG Technology admitted guilt in 14 counts of the complaint and concurred that the board could prove one count directly relating to Colbert’s oversight of the illegal operation. The company did not admit or deny allegations in three other counts.

Prior to the fine announced today, the largest ever doled out by Nevada gaming regulators was $5 million in 2003 against MGM Mirage, now known as MGM Resorts International.

The company was fined for failing to file 15,000 currency transaction reports to the state. At the time, the Control Board said there was never any money laundering or theft of funds in the case involving Christopher Morishita, who supervised the company’s reporting responsibilities, but regulators said the incident compromised the integrity of the state’s gaming control system and reflected poorly on Nevada’s casino industry.

CG Technology operates race and sports books at the M, Hard Rock, Tropicana, Cosmopolitan, Venetian, Palms and the Silverton, provides information as Las Vegas Sports Consultants and holds gaming equipment manufacturing and distribution, mobile gaming and slot route licenses.

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