Denial of former Galaxy executive’s gaming license would be 1st since 2016

It’s been more than three years since the Nevada Gaming Commission has denied a gaming license to an applicant.

On March 19, another name could be added to the state’s list of people and companies that either have been denied or found unsuitable for licensure.

Robert Saucier, the former chairman, president and CEO of Las Vegas-based Galaxy Gaming Inc., was reprimanded by the Gaming Control Board earlier this month for attempting to change the makeup of the company’s board of directors. Following a previous run-in with the Commission in 2017, Saucier was allowed to serve on Galaxy’s five-member board as a director and to hold shares in the company, but not a controlling interest.

Saucier would effectively be banned from the industry if the Nevada Gaming Commission acts on a recommendation made by the Nevada Control Board March 4.

“I feel like I’m being labeled as somebody who doesn’t respect gaming regulators and I would tell you in the 20-plus years that I ran Galaxy Gaming, in over 100 jurisdictions, there wasn’t one single violation, wasn’t one single fine or sanction against the company,” Saucier said in a two-hour hearing before the Control Board. “I take gaming regulatory issues very seriously and this was no different. I took the conditions imposed by this commission seriously and I believe that even as I stand here today, there was no violation as it related to the proxy.

Board members disagreed.

“I think that your argument is a bit novel, but on the whole, unavailing,” board member Terry Johnson said during the hearing.

Saucier has hired management away from rivals Aristocrat Technologies Inc., and Ainsworth Game Technology, and placed high-profile executives on his board of directors and compliance committee.

Potential ban from the industry

If Saucier is denied a gaming license, he would become the first person since Nov. 21, 2016, to appear on a list of 136 people and companies that have been denied or found unsuitable for a license since January 1980. The last entry on the list, Stephan Galdau and SMG Hospitality LLC, was placed by the commission, which maintains a running list of denied and unsuitable applicants that it forwards to licensed companies as a warning to stay away.

Nevada statutes say a denied applicant “is not entitled to profit from his or her investment in a corporation other than a publicly traded company.” He also could not profit through a partnership, limited partnership, LLC or joint venture.

State law also demands that existing licensees stay clear of denied applicants “either directly or indirectly, through any business organization under such a person’s control.”

Galaxy products — mostly side bets on traditional table games like blackjack — are operated by Southern Nevada’s big six casino companies, MGM Resorts International, Caesars Entertainment, Wynn Resorts, Las Vegas Sands, Boyd Gaming and Station Casinos.

Galaxy’s product line includes Lucky Ladies, Texas Shootout and Three Card Poker.

Licensing

Saucier appeared before the Control Board to request a withdrawal of his licensing which would remove scrutiny of him by regulators.

Saucier has had a rocky relationship with the regulatory body from the get-go.

Regulators in California, Oregon and Washington had their doubts about Saucier, and when he was first approved for a gaming license in 2017 the control board peppered Saucier with questions in one of the longest regulatory hearings ever conducted by the board. In California, an administrative law judge, ruling on an appeal of regulatory action in 2013, labeled Saucier’s application to be licensed to provide games to California tribal casinos “a train wreck.”

The company ultimately was approved for a gaming license in Nevada in exchange for Saucier resigning his CEO, president and chairman titles. He turned the chief executive and president duties over to Todd Cravens, who joined the company as a vice president of business development in January of that year. Mark Lipparelli, a former Gaming Control Board chairman and state senator, was appointed chairman of Galaxy’s board of directors.

But Galaxy management complained that Saucier attempted to alter the composition of the board. When questioned, investigators found him evasive.

Instead of granting the withdrawal, they moved to deny the request. When the Gaming Commission meets later this month, it would have to unanimously reverse the recommendation for it to change.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

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