CG Technology agrees to pay $1.5 million fine and pay bettors who were shorted

CG Technology, a sports book manager at seven Las Vegas casinos, would be fined $1.5 million and required to establish an escrow account to pay bettors who were shorted in the calculation of player winnings under a stipulation agreed to Wednesday by the state Gaming Control Board and the company.

In addition, CG Technology President and CEO Lee Amaitis is being forced to resign, effective Aug. 31, under terms of the settlement.

The settlement must be approved by the five-member Nevada Gaming Commission, which is expected to take up the matter at its July 28 meeting.

CG Technology, formerly known as Cantor Sports Book, was accused in a Control Board complaint in May of underpaying bettors by more than $700,000 on an estimated 20,000 wagers.

CG admitted the company’s software miscalculated payouts, and that they failed to notify patrons and the board of the miscalculations in a timely manner, but they denied not cooperating in the Control Board’s investigation, admitting there was sufficient evidence to warrant a settlement.

“Public confidence and trust can only be maintained by strict gaming regulation,” Control Board Chairman A.G. Burnett said in a statement. “The board will not tolerate improper or incorrect payments to patrons by gaming licensees, and therefore takes this matter extremely seriously. This settlement contains several harsh punishments and requirements for remediation that reflect those concerns.”

CG Technology also overpaid about 11,000 bets a total of $100,000 because of a computer software glitch that the company didn’t fix for years. The company never notified gamblers of the problem in paying out some parlays.

CG Technology manages race and sports books at the M Resort, the Hard Rock Hotel, Tropicana, The Cosmopolitan of Las Vegas, The Venetian, the Palms and the Silverton. The casinos lease space to CG Technology and have management agreements to split profits but are not subject to disciplinary action.

ESCROW ACCOUNT ADVISED

The stipulation that will be considered by the Gaming Commission orders that CG establish a $25,000 escrow account to pay claims of individuals who can establish that, between August 2011 and March 2015, they were underpaid by the company on a winning single or round-robin parlay wager and who have not already been paid.

CG will be required to notify potential winners with seven consecutive days of newspaper advertising twice in the next year. The claims period will last a year from the commission’s approval and any remaining money in the escrow account would be donated to the Nevada Council on Problem Gambling.

The stipulation also orders that CG hire an independent third party to evaluate the company’s wagering software for a year with written reports from the consultant after two weeks, six months and a year.

The order doesn’t prevent individual bettors from filing civil lawsuits against the company.

Amaitis, 66, has been a driving force for CG, a subsidiary of the Cantor Fitzgerald investment company that developed sports wagering software similar to what stock brokers use for electronic trading. Amaitis is credited with rebuilding Cantor Fitzgerald, which had offices in the World Trade Center when terrorists attacked Sept. 11, 2001, killing 658 Cantor employees.

The state stipulation requires that Amaitis’ successor submit a licensing application within 30 days of the commission ruling.

A spokeswoman for CG had no comment on the naming of a potential successor. The company is terming Amaitis’ departure as a retirement.

The Control Board’s action was the second time the state has sought to discipline the company over failures within its Cantor Sports Book computerized bookmaking system. Two years ago, the Nevada Gaming Commission warned CG Technology that any future complaints could prompt a license revocation.

REPORTS OF REPEATED UNDERPAYMENTS

The Control Board’s six-count complaint said an enforcement division agent responded to a concern at the Silverton in March 2015 from a gambler who said he was underpaid on a winning round-robin parlay wager. The player told the agent he was correctly paid after pointing out the error but that it was the fifth time he had been underpaid on that type of bet.

The board’s investigation found recurring incorrect payments on various winning parlay wagers and that companywide errors occurred for several years because of software issues known by the company.

The company began operating a computerized bookmaking system known as Cantor Sports Book for its mobile sports wagering in August 2011, the complaint said, and the company miscalculated winning parlay bets for several years.

In April 2014 the company expanded the system beyond mobile gaming and began using the software for counter wagers, but gamblers continued to be incorrectly paid. CG Technology only paid the correct amount to gamblers who brought the error to the company’s attention and made no effort to contact bettors about the miscalculated winnings, the complaint said.

The complaint said CG Technology “effectively ignored a group of several thousand patrons who had won their parlay wagers but who had underpaid their winnings and left responsibility to those patrons to bring an underpayment to the attention of (the company).” The complaint said the company took steps to identify all parlay wagers and patrons affected by the software issue only after the board investigation started. The board issued an industrywide notice in February 2010 about the software issue.

The Review-Journal is owned by the family of Sheldon Adelson, chairman and CEO of Las Vegas Sands Corp., which operates The Venetian.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Find him on Twitter: @RickVelotta

Business Videos
Las Vegas Convention Center expansion taking shape
Renderings and actual footage show how the Las Vegas Convention Center is evolving.
Former Starbucks CEO Howard Schultz at Las Vegas convention
Former Starbucks CEO and potential presidential candidate Howard Schultz spoke at the Epicor Insights user conference at Mandalay Bay Convention Center Wednesday, April 17, 2019. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Drew Las Vegas to open in the second quarter of 2022
The 67-story Drew Las Vegas is slated to open in the second quarter of 2022 at the north end of the Las Vegas Strip. (Michael Quine/Las Vegas Review-Journal)
NAB Day 1 (Time Lapse)
NAB kicked off at the Las Vegas Convention Center on Monday, April 8, 2019. (Mat Luschek / Review-Journal)
National Association of Broadcasters Show shows 1mm thick 8K TV with 22.2 channel digital sound
Japan’s NHK Science & Technology Research Laboratories booth featured a 1mm thick 8K TV system used in conjunction with a 22.2 channel digital sound system at the National Association of Broadcasters Show at the Las Vegas Convention Center. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Nevada shoppers react to Smith’s no longer accepting Visa credit cards
On March 1, Smith’s announced that it would no longer be accepting Visa credit cards at any of its 142 supermarkets, including the 45 in Nevada.
Massachusetts Gaming Commission asks how long Wynn executives knew about misconduct
Business reporter Rick Velotta gives an update on the adjudicatory hearing on the suitability of Wynn Resorts to retain its gaming license in Massachusetts.
Henderson app developer part of Startup in Residence
Henderson based developers of the app On Point Barricade are taking part in Startup in Residence, a North America program dedicated to pairing tech companies with governments. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Sam's Town employees and customers talk of their love for the iconic casino
Longtime Sam's Town employees and customers love each other and love their casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Las Vegas apartments rents
Las Vegas’ apartment market has accelerated in recent years. Developers are packing the suburbs with projects, landlords are on a buying spree, and tenants have filled buildings.
William Boyd talks about the birth of Sam's Town
On the eve of the 40th anniversary of Sam's Town, William Boyd, executive chairman of Boyd Gaming and son of hotel namesake Sam Boyd, talks about how the casino became one of the first local properties in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
High Roller observation wheel turns five
The world’s tallest observation wheel celebrates it’s fifth year on Sunday, March 31, 2019. (Michael Quine/Las Vegas Review-Journal) @Vegas88s
Escape Room Industry Growing In Las Vegas
Escapology employees discuss the growing escape room industry in the U.S. and Las Vegas. (Bailey Schulz/Las Vegas Review-Journal)
Impact of parking fees on visiting the Las Vegas Strip
There are no data showing a relationship between Strip resort and parking fees and the number of out-of-state visitors to Las Vegas. But there are data showing a relationship between Strip parking fees and the number of local visitors to the the Strip. ‘’As a local, I find myself picking hotels I visit for dinner or entertainment, based on whether they charge for parking or not,”’ said David Perisset, the owner of Exotics Racing. ‘’It is not a matter of money, more of principle.’’ A 2018 survey by the Las Vegas Global Economic Alliance found 36.9 percent of Clark County residents reported avoiding parking at Strip casinos that charge for parking. 29.1 percent reported avoiding using any services from a Strip casino that charges for parking.
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Faraday puts Las Vegas land on the market
Nearly two years after Faraday Future bailed on its North Las Vegas auto factory, the company has put its land up for sale. (Michael Quine/Las Vegas Review-Journal)
El Cortez owner Kenny Epstein on running the iconic property
Kenny Epstein, owner of the El Cortez Hotel in downtown Las Vegas, talks about Jackie Gaughan mentorship and answers rumors about bodies in the basement at the mob-era casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
LVCVA recommends construction of underground people mover
The Las Vegas Convention and Visitors Authority announced the recommendation for an underground people mover for the convention center. The system would have the potential to expand and connect Downtown and the resort corridor all the way to McCarran. (Michael Quine/ Las Vegas Review-Journal)
LVCVA/Boring Company Press Conference
The Las Vegas Convention and Visitors Authority announced a collaboration with Elon Musk's The Boring Company to develop and operate an autonomous people mover system for the Las Vegas Convention Center District.
International Pizza Expo includes green and gluten free
The International Pizza Expo at Las Vegas Convention Center included companies focused on vegan and gluten free, and plant-based pizza boxes. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
International Pizza Expo kicks off in Las Vegas
The first day of the International Pizza Expo at Las Vegas Convention Center is everything Pizza. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
T-Mobile program aids guests with sensory needs
A program at T-Mobile Arena is designed to provide a more sensory friendly experience for guests.
Photo Booth Expo
Danielle May talks about how Simple Booth transformed her Volkswagen bus into a business.
Nevada Gaming Commission's highest fines
The highest fines assessed by the Nevada Gaming Commission, according to commission Chairman Tony Alamo: 1) Wynn Resorts Ltd., $20 million, 2019 2) CG Technology (then known as Cantor G&W Holdings), $5.5 million, 2014 3) The Mirage, $5 million ($3 million fine, $2 million compensatory payment), 2003 4) Stardust, $3 million, 1985 5) Santa Fe Station, $2.2 million ($1.5 million fine, $700,000 compensatory payment), 2005 6) Las Vegas Sands, $2 million, 2016 7) CG Technology, $1.75 million, 2018 8) CG Technology, $1.5 million (also $25,000 in escrow for underpaid patrons), 2016 9) Caesars Entertainment, $1.5 million, 2015 10) Imperial Palace, $1.5 million, 1989 11) Peppermill Casinos, $1 million, 2014
Tiny Pipe Home vs Shipping Crate
A Tiny pipe home was displayed at the International Builders Show this week in Las Vegas.
Auto repair shortage affects Las Vegas
The auto repair industry is facing a national shortage of workers.
Franchising industry booming
Experts say Las Vegas is a hotbed for the franchise industry.
Africa Love owner talks about his store in Las Vegas
Mara Diakhate, owner of Africa Love, gift and decor store, talks about his store in Las Vegas. (Bizuayehu Tesfaye/ Las Vegas Review-Journal) @bizutesfaye
Developer gets approval to build homes at Bonnie Springs
The Clark County Planning Commission has approved a plan to build 20 homes on the site of Bonnie Springs Ranch. (Michael Quine/Las Vegas Review-Journal)
Dig This opens new location In Las Vegas
Remember when you were a kid and played with construction toys in the sand box? Dig This Las Vegas has the same idea, except instead of toy bulldozers, you get to play with the real thing. (Mat Luschek/Review-Journal)
TOP NEWS
Home Front Page Footer Listing