Intro to Casinos - Matrerial

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INTRODUCTION TO CASINO AND GAMING OPERATION

CG01


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A WORD OF WELCOME

The casino industry holds a special fascination for the ordinary man in the street. Is it

because gambling is as old as time itself or is it the glitz and glamour of a casino thatattracts us? We will learn the internal workings of a casino as well as its external

ramifications.

The aim of the module is to provide an understanding of the casino business, its

economic and social impact, its operational and organizational structure and the

regulatory framework. Through the knowledge gained, the student should be better

prepared to debate the ethical and moral issues concerning the industry and its impact

on the country


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MODULELEARNING OUTCOMES

a. Describe the evolution of the gaming industry and its national and

international impactsb. Identify the social, economic and regulatory implications of casino gaming

c. State the operations and organisational structure of a casino hotel

d. Describe the gaming regulations of casino operations

e. Analyze future trends in casino and gaming industry

f. Identify modern forms of gaming to attract tourists and high net worth

individuals


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TABLE OF CONTENT

UNIT 1: The evolution of gaming

1.0 Gaming has a long history

1.1 The evolution of gaming in Europe

1.2 The evolution of gaming in the US

1.3 The emergence of key gaming centers in the US

1.4 The unsavory elements in the gaming industry

1.5 Rise of gaming in Indian reservations

UNIT 2: Gaming Regulations

2.0 Why the need for close regulation

2.1 The Nevada model

2.2 Types of Licenses used in Nevada

2.3 The New Jersey model

2.4 Types of employee licenses used in New Jersey

UNIT 3: The Economic Impact of Casinos

3.0 Rapid growth in casino revenues

3.1 The re-vitalization of cities

3.2 Job creation in the industry

3. 3. Chasing after the tourist dollar


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3.4 Recognizing the liabilities and costs

UNIT 4: The sociological impact of casino gambling

4.0 The arguments for an against casinos

4.1 Is gambling just entertainment?

4.2 Why people gamble

4.3 Some social problems with casinos

4.4 The social cost of addictive gambling

UNIT 5:Modern casino and gaming operations

5.0 The modern day casino-hotel

5.1 Financial concerns and control

5.2 Regulatory standards

5.3 Marketing to casino customers

5.4 How gaming helped save the Niagara Frontier

5.5

UNIT 6: The future of the casino industry

6.0 How the industry is likely to be perceived in the future

6.1 How human resource in the casino industry is likely to change


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6.2 The Impact of technological changes

6.3 Geographical expansion of the industry

6.4 Casinos are getting bigger and more expensive

6.5 The effect of globalization

7 REFERENCES

1 Rudd, D.P. & Marshall, L.H. (2000), Casino & Gaming

Operations, Prentice Hall, Upper Saddle River, NJ 07458

2 Kilby,J. Fox,J., Lucas, A.F. (2005), Casino Operations

Management, John Wiley & Sons, Inc., Hoboken, New Jersey

3 Kathryn Hasimoto, (2008), Casino Management, Pearson

Educational Inc. Upper Saddle River, New Jersey 07458


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8 APPENDIX

8.1. Appendix 1. Game over for TOTO machine at Food Center Straits

Times. 4th Sept 2009

8.2. Appendix 2 Universal Allure, Straits Times 21stOct 2009

8.3. Appendix 3. IR to get top chefs , Straits Times 24th Oct 2009

8.4. Appendix 4 Boost for gaming as China eases limits on citizens

visiting Macau , Straits Times 22nd Sept 2009

8.5. Appendix 5. Casino for Kinmen? Varsity may be winning bet,

Straits times 31st Oct 2009.

8.6 Appendix 6 I cannot let him go to casinos , Straits Times , 23rd

Sept 2009

8.7 Appendix 7 15% of gambling addicts tried to kill themselves Straits

Times, 25th Sept 2009

8.8. Appendix 8 SMU group to educate young on pitfalls of gambling

Straits Times 22nd Sept 2009

8.9. Appendix 9 Most problem gamblers get hooked at early age ,

Straits Times, 18th Aug 2009

8.10 Appendix 10 As temptations to gamble grow, many are turning to

counseling centers to stay clean , Straits Times 29Aug 2009

8.11 Appendix 11 Whereabouts of gambler stumps all Straits Times

15th Oct 2009

8.12 Appendix 12 $66 for a day pass to Universal Studios Straits

Times 19th Nov 2009

8.13 Appendix 13 Play Incentives from Kathryn Hasimoto, (2008),

Casino Management, p303.

8.14 Appendix 14 "Changes Made to Casino Control Act"

Straits Times 16th Sept 2009


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UNIT 1 The Evolution of Gaming


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UNIT OBJECTIVES

I. Appreciate how gaming has evolved as a social activity over its long history

II. Know some modern gaming formsIII. Appreciate how gaming has attracted supporters and detractors

IV. Recognize where gaming is heading


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UNIT 1 (1.0) Gaming has a long history

It goes back 4000 years. Man was not just preoccupied with hunting for food.

They had gaming as a social and cultural activity. Archeologists have found that

gaming existed during the days of the Pharaohs of Egypt. Gaming is as ancient

as time itself. Around 100BC a Chinese Emperor used a form of gaming

resembling Keno to raise money for his armies. It is possible that the Great Wall

of China depended on money raised through gambling. Even the Romans had a

go at it. Modern casinos may have had their origins in ancient Rome. Around 68

A.D. the Roman Caesar, Nero, held lotteries and gave prizes consisting of land,

jobs, ships and slaves. . Emperor Caligula is said to have lost the entire treasury

through a game of dice. Even the famous Greek philosopher, Aristotle, wrote on

how to cheat at dice.

The Greeks worshipped a goddess of gambling named Tyche; the Romans

called theirs Fortuna. A Greek mythology believed that Zeus was given controlof heaven,Poseidon the seas, and Hades, hell because they played a game of

dice to decide who should control what. Stories in the Bible reveal gamblingexisted. Soldiers gambled for the clothes of Christ, and the Old Testament tells

us that Aaron was instructed to cast lots to determine which of his two goats

would be sacrificed.

From the earliest of time, gambling was considered a sin and in many societies

throughout the different periods there were laws forbidding gambling. Ancient

Greeks viewed gambling as a sin. In ancient Egypt, those who owed money

through gambling were forced to pay off their debts by working in the quarries. In

early Rome, there were laws forbidding gambling. Yet gambling survived through

the ages. Gambling was too popular to be stopped


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Activity

1. Can you recollect your early gambling experiences? Have you ever

placed a bet with anyone before? What did you bet on? Why did

you bet?


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Early gambling may have been linked to religious practices. Betting often led to

life or death situations. If you were sick, the throw of a dice could determine

whether you were going to live or die. If you were going to be sacrificed together

with others, drawing lots could mean that you may be spared. In early Rome,

gladiators drew lots and fought to the death.

Illustration

1,In Chinese culture, the worshipping of various gods or ancestors often involves

the picking of numbers for lotteries.

See Appendix 1. Game over for TOTO machine at Food Center Straits Times.

4th Sept 2009

Activity

2.

Can you see the connection between religion and gambling in Appendix 1?

Do you see any connection between your own culture/religion and gambling?


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UNIT 1 (1.1)The evolution of Gaming in Europe

From 5

th

to 9

th

century, not much was written about gambling. We do know thatthe Germanic tribes played a dice game and losers had to become the slaves of

the winners. At the time of the Crusades, Richard the Lion Heart, disallowed

those below the rank of knights to gamble. The punishment for losing more than

20 shillings a day often meant that you were stripped and flogged for 3 days.

Interestingly enough, clerics were permitted to gamble. Kings, of course, were

above their own laws and were often frequent gamblers. After the Crusades,

gambling became fairly wide spread in Europe.

The first recorded state lottery took place in France in 1520. Queen Elizabeth I

also used the lottery in 1596 to raise money to build ships. In 1770s, it was again

used to raise money to fight the American Revolution. In 1826, national lotteries

were banned in England ( this ban was only removed in 1992 ).

During 18th and first half 19th century, gambling went through its troughs and

peaks. In the 1860s gambling was banned in Italy and France but the latter half

of the 19th century saw the rise of the big gambling houses. Francois Blanc built a

casino in Luxembourg and a still bigger one in Baden Baden (Germany). Itattracted the rich all over Europe and was a tremendous success. In 1863, the

Grimaldi family began their famous casino in Monaco. It attracted royalties like

the Prince of Wales, Emperor Franz Joseph, Czar Nicholas and Leopold II

(Belgium) .Even wealthy Americans flocked to Monaco to gamble. John

Morrissey, an American, took the concept back to the US. He built the luxurious

Saratoga Club in Saratoga Springs, New York. Gambling casinos are still allowed

to operate in Europe today in Germany, Monte Carlo, Austria and Great Britain.


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Illustration

Some of the more prominent gambling addicts in old Europe were:

King Henry XVII who gambled away the Jesus Bells of St. Pauls cathedral to Sir

Miles PartridgeHenry IV of France who hired professionals to cheat his court officials on his

behalf

The commanding officer of Charles V of France who lost all his soldiers pay

during the siege of Orange. Charles V had to surrender. Thereafter cavalry

officers were not allowed to gamble under pain of death.

Activity

In the 1960s, gaming was legalized in Great Britain. Churches were allowed to

raise funds through Bingo games. Private enterprise took advantage of this

liberalization. Today there are more than a thousand casinos in the UK. Bookie

joints were also legalized and before long it became morally acceptable to make

use of gaming to make money.

Illustration

Activity


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UNIT 1 (1.2) The evolution of gaming in the US

It began in 1492 with the sailors on the three ships of Christopher Columbus.

Spanish and Portuguese sailors brought cards, dice and horses for betting.

Some of the horses escaped into the wild plains and eventually the Indians were

gambling on herds and ponies. This often led to war with neighboring tribes as

they needed to make good their losses. The Indians used pear and plum pits as

dice.

In colonial America, almost every household had playing cards. Colonial Americaloved gambling. George Washington was an avid card player. Benjamin Franklin

made and sold cards. The British in imposing their infamous Stamp Act, also

levied a tax on every pack of cards sold.

Virgina was founded mainly by lottery money. Universities like Yale, Harvard,

Princeton, Columbia were all started with seed money from lotteries. Lotteries

were used to finance public works like roads, schools, churches, buildings, dams

and hospitals.

Ben Franklin used the lottery to defend Philadelphia from the French and the

Indians The Continental Congress started a $5m lottery to fund the Revolutionary

War in 1777. They were so poor that those who betted more than $50 were told

that they would be given promissory notes payable in the future if they won.

However in places like New England, where the deeply religious and

conservative puritans lived, gambling could not be condoned and fines and

physical punishments were inflicted on those caught gambling. It was ironic,

however, that the Puritans themselves, had earlier on, used a form of lottery to

raise sufficient funds to build the Mayflower to enable them to sail to America.


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Other states generally had a live and let live policy and although illegal, many

chose to keep a blind eye to gambling especially to lotteries. After 1776, state

franchised lottery companies were fairly widespread, even though it was against

the law. In the absence of an efficient taxation policy, lotteries were often the

quickest and cheapest way of raising funds.

Illustration

Activity

Spread of gaming in USA after 1800:

In the early 1800s, gaming houses sprouted, taking their cue from the European

and English gaming houses New Orleans became a gambing center. The

Crescent City House in 1827 was one of the first gambling houses to be

regulated in New Orleans. Other gaming activities included cock-fighting, bear

baiting, horse-racing, and dog fighting.

Unfortunately, fraudulent lotteries became widespread and this lead to an anti-

gaming reform movement. By the time of the Civil War, only 3 states allowed

lotteries Delaware, Missouri and Kentucky.

All of this changed once more after the Civil War, beginning with the famous

Louisiana Lottery in 1865. Because the stakes were high, gaming syndicates

often bribed politicians and law enforcers to look the other way. The Louisiana

lottery was one such example. The syndicate was allowed to operate the lottery

for 25 years by paying a $40K fee per year to the state. It became increasingly


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corrupt. Despite various efforts to stop it, the syndicate continued to bribe its way

through until it finally ended in 1895.

In the river states of the Mississippi and Ohio Rivers, riverboat gaming attracted

cheats and unsavory characters. New Orleans became a gamblers haven. Faro,

3 card monte, poker, were common on riverboats and in gaming houses.

Cheating was widespread. Sharpers marked cards and kept cards up their

sleeves. Thieves and prostitutes were also attracted to the gaming centers in

Louisville, Natchez, Memphis and Cincinnati. The lawlessness is best epitomized

by the Clan of the Mystic Confederacy which started in 1832. It had 100 criminals

in its Grand Council and 1500 outlaws as members.

Illustration

Activity


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UNIT 1 (1.3) The emergence of key gaming centers in the USA

Content

New York city became a primary gaming center after the Civil War in the 1850s.

It boasted more than 6000 gambling houses. Gambling became synonymous

with corrupt legislators and law enforcers. John Morrissey who built the Saratoga

Club, was the undisputed king of gambling in New York for 20 years. He even

went on to become a Congressman

Chicago was another important gaming center. The prominent player was Mike

McDonald. After the great Chicago fire in 1871, he became the big man behindgambling in Chicago. He even staged police raids on his own gaming house just

to pacify the public.

Other gamblers took to the West. San Francisco became the gaming capital of

the West during the time of the first Gold Rush in the late 1840s. There were

some 40,000 prospectors in San Francisco who were gamblers in spirit and

desperate for entertainment. Free food and entertaining lured the gamblers into

the dens Some of the most famous Wild West towns associated with gaming and

lawlessness included Deadwood, Tombstone, Dodge City. These towns were

famous for their gun fights and western folk lore. Denver and Kansas City were

also prominent gambling towns. Most games were dishonest but this did not

deter the gamblers. Frontier life was often hard and lonely and gambling provided

relief and excitement..


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Illustration

Activity3. Given that most gamblers knew the gaming houses were dishonest, why were

they still attracted to such places?


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At the beginning of the 20th century, anti-gambling advocates had closed down

many gaming houses, race tracks, numbers and book-making operations. By

1915, only 7 states allowed horse racing. As America became more urbanized,

gambling syndicates developed in the city slums. In the Prohibition era, gambling

became a highly organized national activity. It went hand in hand with organized

crime, with infamous mobsters like Al Capone, Frank Costello and others relying

on gambling as the main money spinner. Like alcohol, banning gambling did not

mean the death of gambling. It only served to drive it underground, thereby

enriching the mobsters.

In 1894 the Beach Club casino in Palm Beach, Florida was built. It went on for 48years although it was an illegal establishment. But Miami became important only

when Al Capone moved in. By 1930s, Miami Beach had first class casinos

backed by top entertainers. Race tracks, dog tracks and jai alai were popular. By

1950s, mobsters had turned gambling into legitimate businesses. The Beach

Club was the first to welcome wealthy society women to gamble. They proved to

be extravagant gamblers.

Nevada banned gambling in 1910 but legalized it in 1931 after the Great

Depression. In the beginning the same gambling houses were known as saw

dust joints.. Towards the end of World War 2, Las Vegas began to flourish.

Workers building the nearby Hoover Dam had little else to do but entertain

themselves in the gambling casinos in Las Vegas. The glitzy Vegas we know

today was started by mobsters with Bugsy Siegal leading the way with the

Flamingo. As more and more mobsters and their families settled in Vegas, the

mobsters themselves installed their own brand of law and order to ensure their

investments were not jeopardized.

Vegas today is different from its past. It has become clean through Nevadas


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tough gaming laws and enforcement. Free drinks, top entertainers, great hotel

accommodation, cheap food, free gambling chips draw customers from all over

the world. Even families with children are able to have fun in casinos like the

Excaliber, MGM Grand, Circus Circus and Treasure Island.

In 1976, New Jersey allowed casinos to open in Atlantic City. The gaming taxes

were meant to be used to reduce the normal taxes for the people and to look

after the elderly and disabled. Although more people visit Atlantic City than

Vegas, it makes less money out of gambling. Its customers are mostly day

trippers with the sole purpose of gambling, not entertainment. The noble

intentions of putting gambling money to good use by the legislators have notbeen fully realized.

Other States continued to exercise a tight control over gaming establishments.

By 1993, however, charitable gambling was endorsed by 43 states. Bingo games

even found their way into Indian Reservations. In 1964, New Hampshire became

the first to legalize lottery. By 1998, 38 states had followed suit. New Jersey was

the first to legalize numbers. (betting on 3 digits between 000-999). Off-track

betting operated illegally until it was legalized by New York in 1970 and soon

after, 32 other states followed.

The gaming business has shown tremendous growth in the US. Only Utah and

Hawaii prohibit any form of gaming. Riverboat gambling is on the uptrend again.

Casinos now operate in many Indian Reservations.

Despite the growth of gaming and the growing legitimization of gaming, the

under-currents of anti gambling sentiments continue to exist.


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Illustration

Activity

4. It would seem that gaming activities continued to grow in spite of the fact that

they were illegal. Would it not have been easier for governments to legitimize

gambling from the start? Why would criminal elements be attracted to gambling?


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UNIT 1 (1.4) The unsavory elements in the gaming industry

Somehow gambling has always attracted the cheaters from the earliest of times.

Artistotle, the famous Greek philosopher, wrote on how to cheat at dice. Emperor

Caligula, in ancient Rome, having lost the entire treasury through gambling ,

promptly accused two noblemen of treachery, confiscated their wealth and

continued with his gambling. As earlier discussed, Henry IV of France hired

professionals to cheat on his behalf. Cheaters, who were called "sharpers",

already identified their victims the moment they set foot on the Mississippi

riverboats. The cheaters used marked cards or kept cards up their sleeves.

Fraudulent lotteries were widespread.

Often the politicians and law enforcement agencies were bribed to look the other

way. We have seen how lawlessness in New Orleans is best epitomized by the

Clan of the Mystic Confederacy. Set up in 1832 it was made up of 100 criminals

in its Grand Council and 1500 outlaws as its members. The Beach Club in Miami

was able to operate for 48 years even though it was an illegal establishment.

The gaming industry was and still is highly profitable. It early growth went hand in

hand with famous mobsters like Al Capone, Frank Costello and others. Las

Vegas was started by a mobster called "Bugsy" Siegal who built the Flamingo.

John Morrissey who built the Saratoga Club was the undisputed king of gambling

in New York for 20 years. Mike McDonald controlled Chicago gaming and as

previously indicated, even staged occasional police raids on his own

establishments to pacify the public. Governments were powerless to stop the

underworld from taking control of the gaming facilities all over the US.

Over time the gaming business became more legitimate. Governments set up

regulatory bodies to ensure the customer was no longer fleeced and the criminal


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elements were kept out. Because of its long historical association with unsavory

elements and the underworld, the casino industry today remains one of the most

regulated industry in the world.

Illustration

Activity

5. Now that you have a better understanding of how gaming evolved in the USA,

would you say that it brought more good than harm to the country?


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Gaming in the US, served a useful purpose in the days when government taxes

were either not fully implemented or were non-existent. Gaming could provide a

quick and significant source of funding for government activities. As gambling

grew, it attracted the unsavory elements. The industry was highly lucrative and

relatively easy to organize. Gambling became dishonest. This in turn generated

anti-gaming sentiments leading to governments clamping down on the industry.

Unfortunately like Prohibition, it merely benefited organized crime. By banning

gaming houses and lotteries, organized crime became richer and more powerful.

After the Great Depression, the fortunes for gambling turned once again and

governments were more keen to have a share of the lucrative proceeds. With

legitimization came greater regulatory control.

Illustration

Activity


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UNIT 1 (1.5) Rise of gaming in Indian Reservations

In the early days Native American Indians were placed in reservations and in the1830s, the government allowed them to self-regulate their reservations. Poor

education and high alcohol consumption within the reservations lead to high

suicide rates and unemployment and poverty. With the passing of the Indian

Gaming Regulatory Act in 1988, some Indian reservations were quick to seize

the opportunities offered through the establishment of gaming operations within

Indian reservations. In 1998 tribal gambling takings had reached $288 million. By

2003 this figure climbed to $16 billion. Tribal casinos employ some 400,000

people with most jobs going to the non-Native Americans.

There were early funding issues but some foreign investments bridged the gap.

Foxwoods Resort casino, in Pequot reservation, is one of the biggest casino in

the world, This was made possible through foreign funds from Malaysia.

Illustration

Activity

Content

Illustration

Activity


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UNIT REVIEW

The evolution of gaming shows that despite all the measures taken to make

gambling illegal, public acceptance of gambling continued. Although there is a

growing legitimization of gaming, and wider public acceptance, the under-current

of anti-gambling sentiments continue to exist.


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UNIT 2 Gaming Regulations


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UNIT OBJECTIVES

I. Analyze the development of casino regulatory bodies in Nevada and New

Jersey

II. Appreciate the regulations that would normally be imposed on the casino

industry

III. Discuss the types of gaming and casino licenses given out in Nevada and

New Jersey to regulate and control the players in the industry


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UNIT 2 (2.0) Why is there a need to regulate the gaming industry so

closely?

As we have seen from the previous lesson, the evolution of gaming in the US

was closely associated with cheats, mobsters, corrupt politicians, corrupt law

enforcers, murderers, thieves, prostitutes and other unsavory characters.

Most gaming houses were dishonest.

Dishonest lotteries presented quick and easy ways to make lots of money.

On the other hand, gaming also provided an opportunity for governments to raise

funds which could be channeled into other worthwhile causes.

The bottom line was that gaming was alright so long as there was a way to keep

out all the bad elements.

Although Nevada legalized gambling in 1931, a Senate Committee finding

revealed that as late as the 1950s casino owners still had links to organized

crime. Therefore the gaming industry must be highly regulated and properly

policed so that governments can enjoy the good without suffering the bad.

Illustration

Activity

Las Vegas, for example, started off with money from mobsters and for a while,

the mobsters even imposed its own brand of law and order in the City to keep the

peace. All this has changed. Today the casino businesses have all been

legitimized through tight regulations and Las Vegas has become a fine example

of clean gambling where even families with small children can come to for their


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vacation.

Casinos today have transformed themselves into integrated resorts.

Illustration

Read Appendix 8.2. Straits Times 21st Oct 2009 Universal Allure Understand

how casinos are transforming themselves into Integrated Resorts through

amusement parks and theme playgrounds.

Read Appendix 8.3 Straits Times, 24 Oct 2009. IR to get top chefs. Understand

how Marina Bay Sands is getting top chefs from around the world.

Activity

6. What are the possible features or facilities that can be added to a casino to

transform them into integrated resorts?


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UNIT 2 (2.1) The Nevada Model

The Nevada gaming regulations have often been copied by other governments

because they were the pioneering state in the US to legalize gambling in 1931 on

a large scale. It has over time evolved a set of regulations through trial and error

and through painful experiences. Hence other governments could make use of

Nevada's experience to draw up their own regulatory framework.

The Nevada authorities had three main considerations when they drafted the

casino regulations:

1. they wanted to make sure that the money earned by the gaming houses wereproperly taxed

2. they wanted to be sure that all the games conducted were above board and

customers were not being cheated.

3. they wanted to ensure that the criminal elements that are normally associated

with the gaming industry were kept out of the industry

Illustration

Activity

The Nevada form of regulatory control is based on a three tier set up to create

checks and balances between regulatory bodies:

1. The Nevada Gaming Control Board - This is the enforcement agency for

licensing and operation of all gaming places. It has three members appointed by

the Governor and is backed by more than 300 professional employees operating

in 7 divisions within the Gaming Board

2. The Gaming Commission - it serves to say yes or no to the recommendations


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of the Gaming Board. It is the final authority on licensing matters. It can approve,

revoke, restrict, deny, condition or suspend gaming licenses. It consists of 5 part

time members appointed by the Governor, supported by a full time Executive

Secretary. It has to meet at least once a month.

3. The Gaming Policy Committee - it serves as an advisory body to both the

Commission and the Board. It is chaired by the state Governor himself, assisted

by 8 members from the legislative bodies, the gaming industry, the regulatory

agencies and the public. Its recommendations however are not binding on the

Gaming Control Board or the Gaming Commission

The 7 divisions in the Gaming Control Board consist of:

1. Administration: responsible for issuing and amending licenses for casinogames and slot machines, updating files.

2. Audit: Its largest division. It audits the accounting records of industry players,

ensures compliance, review internal controls, make surprise checks on cash

counting procedures. All audit employees are required to be accountants.

3. Special investigation & Intelligence: investigates post-licensing and non routine

gambling problems and gathering industry intelligence

4. Investigations: responsible for checking background of all applicants. Also

checks on casino operational methods. Extensive field work requires agents to

travel frequently

5. Electronic services: monitors all electronic devices in the industry. Checks all

newly designed machines, develop standards for electronic gaming devices, spot

checks on slot machines and develop methods to uncover machines that are not

functioning properly.

6. Tax and License Economic Research: collects, controls and does the

accounting for tax and license fees. Conducts research and development studies

and provides information to the industry players.

7. Enforcement: Its offices are opened 24/7. Responsible for enforcing the

Gaming Control Act., and checks playing cards., performs undercover roles and


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arrest of cheaters. Oversees a hearing examiner for complaints

Illustration

Activity

7. Do you think the Nevada model can be effective elsewhere? What if the

government itself is inherently corrupt in the first place?


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UNIT 2 (2.2) Types of licenses used in Nevada

1.Gaming Licenses.

There are 3 types:

A. Restricted Licenses. This is for operations with 15 or fewer machines and no

other gaming. The License is issued annually and has to be renewed quarterly.

B. Nonrestricted Licenses: This is for those with 16 or more slot machines or one

or more slot machines operated together with table games. This license is issued

annually and has to be renewed quarterly.

C. Nonrestricted slot machine licenses. This is for large scale slot operators. Thelicense is issued and renewed annually.

2. Manufacturers licenses.

This is issued to manufacturers of gaming machines, devices, equipment and

related material. It is issued and renewed annually.

3. Distributors licenses.

This is issued to distributors of gaming devices, equipment and other related

material. The license is issued and renewed annually.

Illustration

Activity

Licensing of individuals

1. Individual license:

Granted to casino owners who derive profits from operations


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2. Partnership license:

Given to both general and limited partners. Passive partners are not given a

license. Corporate partners must also be approved for a gaming license

3. Corporation license:

Owners and shareholders of publicly traded gambling corporations must be

registered. The Gaming Control Board and the Gaming Commission will decide if

any individual needs to be formally licensed. All officers, directors and

shareholders of closely held corporations however must be licensed

4. Employees to be licensed

All individuals wanting to work in the gaming industry must be approved by the

Nevada Gaming Commission. Fingerprints and personal history will have to besubmitted to the local police or sheriff department. Granting of licenses to work in

the industry is considered a privilege. Key employees with licenses are not

permitted to gamble within their sponsored casino. Generally key employees are

considered as anyone who is a Supervisor and above or anyone who has

influence over decision making in any part of the casino operations or listed in

the annual employee report. Even labor organizations and labour leaders require

licensing

Apart from these regulatory licenses there are also rules regarding the minimum

number of hotel rooms that must be built in conjunction with a casino .e.g. In

Reno, the minimum is 300 rooms. Other regulations relate to casino layout and

public space usage, credit procedures, gaming rules, accounting records,

etc

Illustration

Activity

8. What other industry can you think of that has to subject itself to onerous rules

and regulations?


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UNIT 2 (2.3) The New Jersey Model

The regulations are stricter than Nevada. They also have a larger enforcement

team. Gambling was legalized in 1976 by referendum. The Casino Control Act

led to the setting up of New Jersey Casino Control Commission and the Division

of Gaming Enforcement. It is very difficult to get a casino license in New Jersey.

Gambling is only permitted in Control Commission approved hotels. The

minimum hotel accommodation to be provided as part of a casino is 500 rooms.

There must also be minimum meeting and exhibition space and dining facilities,

live entertainment and indoor sports. Credit practices and collection of winningsare all tightly controlled

Illustration

Activity

Controlling bodies

1. Division of Gaming Enforcement

Operating under the Attorney General, it does background checks on all

applicants, makes nonbinding recommendations to the Casino Control

Commission, and enforces the criminal provisions in line with the Casino Control

Act. Their activities must be approved by the CCC. (Casino Control Commission)

There are 4 main departments - Investigation, Intelligence & Research, Legaland Administration.

2. Casino Control Commission

The CCC is an independent unit of the New Jersey Department of Treasury


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Its role is to ensure the vitality and integrity of the gambling industry. It also aims

to re-vitalize the economy of Atlantic City. It undertakes regular reviews of the

financial performance and internal control of all casinos. It licenses all individuals

and companies and collects licensing fees and taxes. It holds administrative

hearings and has subpoena powers. There are 5 full time members, appointed

by Governor. No more than three members can be from the same political party.

No member must have any active involvement in the industry. The members

serve overlapping 5 year terms. Commissioners can be removed with cause.

There are 4 divisions: Financial Evaluation and Control, Legal, Administration,

Licensing.

The Investigations department within the Division of Gaming Enforcement has 4sub-units:

1. Enforcement unit cheating and complaints, proper operations by casinos

2. Compliance unit supervision and security of each and every casino

3. Individual background unit background checks on individuals

4. Gaming School unit- background investigations into conduct of business

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UNIT 2 (2.4) Types of employment licenses used in New Jersey

A. Casino service employee non-gaming license: This is required for those

working in casino-hotels, and includes the room division, F&B, and Front Office

personnel. A one time registration fee is required. There is no need for renewals.

A thorough background check will be conducted for all applicants..

B. 2-1 casino gaming license. This is for those working directly on the casino

floor e.g. dealers, security and finance personnel. It carries a validity of 3 years

and is renewable upon payment of a fee. Again personal disclosure is required of

the applicant together with checks on his/her personal background.C. Key License These are usually for managers and are renewed every 3

years. They are also subject to thorough checks before the license can be given.

D. Junket License: This is granted to junket operators only after a

comprehensive investigation by the CCC. The license has to be renewed every

two years

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Activity

9. Do you see any similarities or differences between the way gaming is

controlled in Nevada and in New Jersey?

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UNIT REVIEW

Given the dishonest elements associated with the growth of gaming in the US, ithas become necessary for governments to impose strict regulations to control

gaming activities. As the pioneer states to legalize gaming, both the Nevada and

New Jersey experiences allow us the opportunity to learn from their regulatory

frameworks and experiences.


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UNIT 3 The Economic Impact of Casinos


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UNIT OBJECTIVESI. To understand the benefits generated by the casino industry to governments

and its people

II. To appreciate that there is also a downside to the industry


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UNIT 3 (3.0) Rapid Growth in Casino revenues

In 1997, the estimated revenues from the casino industry in America was about$51 billion. This was only $9 billion in 1961.

This growth was due to several factors:

-the rise of more casinos, such as riverboat casinos, Native American reservation

casinos, slot machines at horse racing venues, and mega casinos in the

traditional casino destinations of Nevada and New Jersey.

-the increase in disposable income within the population and greater number of

participants

Research by casino operators showed that the people who frequent casinos

were usually more wealthy and more educated than the population's average

figures.

There were more males than females.

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Activity

10. What do you think are the other industries that can benefit from the growth of

the casino industry? Name 5.

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UNIT 3 (3.1) The re-vitalization of cities

Casinos provide an easy way out for governments struggling to find an answer to

re-vitalize a city.

It generates a huge amount of gambling tax, creates many jobs and attracts the

construction of related attractions and infrastructure, leading to increased

spending by "outsiders"

Before casinos were introduced in Atlantic City, the local government was faced

with the problem of an economically depressed city. Today, Atlantic City's

casinos provide for Atlantic County's total budget.

The same economic reasons were used to grow the casino industry in South

Dakota, Colorado, Iowa, Illinois, Indiana, Louisiana and Mississippi.

Casinos generally pay gaming taxes ranging from 6.5% in Nevada to 20% in

Illinois and Indiana.

New Jersey collects about $400 million in gaming taxes alone each year.

There is also a sales tax of about 3-6 % generally but Atlantic City collects 12%

in sales tax.Casinos pay a higher property tax than other industries and in Atlantic County

almost a third of all property taxes collected come from twelve casinos.

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Activity

11. Millions of dollars in tax revenues are lost each year to illegal gambling.

Governments often use this "excuse" to encourage the growth of casinos. Do you

feel that this is an acceptable reason?


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Content

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Activity

12. Would you describe the casino industry as "robbing" from the rich to feed the

"poor"? Does the end justify the means?


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UNIT 3 (3.2) Job creation in the industry

The casino industry is labour intensive. It is estimated that for every milliondollars in casino revenues generated, 13 new jobs are created.

Apart from direct employment by the casinos, thousands of other jobs are

created in supporting industries, like hotels, food outlets, entertainment facilities,

construction, transportation, housing, etc

Because casinos are highly profitable businesses in a stable economy, average

wages paid to those people working in the industry was found to be higher that

the national average in the US in similar industries.

For example the average wage for a casino employee in 1995 was about

$26,000 a year versus $16,000 - $20,000 for those in the hotel, service and

motion picture industries

A large proportion of the jobs in a casino are white collar jobs and it employs

great numbers of managers, professionals and technicians.

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Activity

13. Is there a potential problem if a city becomes over-dependent on a single

industry

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UNIT 3 (3.3) Chasing after the Tourist Dollar

The casino industry is really a part of the tourist industry. It is often sold as atourist attraction. In Las Vegas, many casinos like Circus Circus cater to the

whole family.

When the Singapore government decided to go into the casino industry, after

many years of refusing to do so, it was for the purpose of re-making Singapore

into a more attractive tourist destination as it does not have many natural

attractions to offer the tourist.

Las Vegas and Atlantic City are able to attract more than 30 million visitors each

annually

Infrastructure development is a key component of tourism growth. For casinos to

be successful, it must attract large numbers of "outsiders". Accessibility by land,

air and sea becomes crucial. There must also be adequate hotel

accommodation, a comprehensive transport system as well as a wide range of

food choice.

Transient gamblers and the influx of casino workers create a more attractive

cosmopolitan atmosphere which adds to the re-vitalization of cities..

Illustration

Refer Appendix 4. Straits Times 22nd Sept 2009 Boost for gaming as China

eases limits on citizens visiting Macau. Understand the importance of foreign

based gamblers to a casino

Activity

14. What do you think are the key factors in the casino industry that encourages

the growth of tourism?


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UNIT 3 (3.4) Recognizing the liabilities and costs

There are various downsides to the casino industry.Apart from the fact that casinos will place a higher demand on the city's

resources (e.g. water, electricity,) and infrastructure, there are also issues related

to law enforcement and the rise of gambling as an addiction amongst the local

population.

In a study conducted in several states in the US, it was found that gambling

addiction jumped 3 fold with the introduction of casinos.

The invisible social costs associated with gambling would include suicide,

bankruptcy, loss of jobs, and domestic violence.

Illustration

Refer Appendix 5 Straits Times 31stOct 2009. Casino for Kinmen? Varsity may

be winning bet. Understand how some cities have rejected casinos.

Activity

15. Do you think the benefits of having a casino far outweighs the "social costs"

associated with the industry?

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UNIT REVIEW

The casino industry continues to be an attractive and tempting proposition formany governments because it generates significant taxes, creates many jobs,

supports many other associated industries, draws many visitors and adds a new

vitality and cosmopolitan look to a city. However, there are social costs to be paid

before such benefits can be achieved.


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UNIT 4 The sociological impact of casino gambling


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UNIT OBJECTIVES

I. Understand how casinos can generate social problems

II. Recognize the existence of problem gamblingIII. Appreciating the social costs associated with gambling

IV. Understand the need for a balanced approach to gambling

UNIT 4 (4.0) The arguments for and against casinos

In our previous lesson, we have seen how casinos can play a useful part in re-

vitalizing a city, generating income that can be channeled to other worthwhile

causes, attracting more tourists and creating more jobs.The IR in Sentosa for example is likely to generate some 8000 new jobs for

Singapore and a similar number in Marina Bays Sand in 2010..

Against this positive note, we need to also recognize that there are several

negative aspects to the casino industry, especially in terms of social costs to the

state and its people.

The debate over whether a casino is good or bad for the country usually revolves

around the issue of the economic benefits versus the sociological costs.

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UNIT 4 (4.1) Is gambling just entertainment?

In earlier lessons on the evolution of gambling we have recognized that gamblinghas been a social activity through most of mankind's existence. There is always

this fascination regarding getting easy money with minimum effort - a something

for nothing attitude. Can we view gambling as just another form of

entertainment? Should we treat it no differently from a person who watches

movies as a form of entertainment? The problem with gambling lies in one's

obsession to win. It can become so addictive that a person may cheat just to win

or steal just to fund his/her gambling habit. This obsessive behavior often leads

a person to commit further criminal acts which causes considerable hurt and pain

to those close to them.

The environment within casinos can also be addictive. The drinking, the music

and the women can create the perfect environment to push one into becoming a

casino addict.

Illustration

See Appendix 10. Straits Times Report 29th Aug 2009 "As temptations to gambling

grow, many are turning to counseling centers to stay clean"

Activity

16. Do you consider gambling as a form of bad habit like smoking or do you think

gambling is more in line with substance and alcohol abuse?

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UNIT 4 (4.2) Why do people gamble?

People gamble for a variety of reasons: Pure greed, rubbing shoulders with therich, showing off to a girlfriend, wanting to kill boredom, masochism, as an

intellectual exercise, desire to be able to overcome the odds, the sheer

excitement of winning, achieving unfulfilled goals

Some psychologists even see gambling as related to sexual problems.

There can be as many as 10 million compulsive gamblers in the US that require

help. In 1980, the American Psychiatric Association officially recognized that

addictive gambling was a form of mental disorder and had to be addressed like

any other mental disorders.

There are different types of gamblers. - The problem gamblers, the pathological

gamblers, the social gamblers, the professional gamblers and the compulsive

gamblers.

Depending on their levels of addiction, gamblers can attempt suicide, resort to

cheating and stealing and borrowing, be totally uncontrollable, and develop

chronic mental disorders.

Casinos are also wary of the compulsive gamblers who chalk up huge amountsof credits and later declare bankruptcy.

Illustration

Refer Appendix 6. Straits Times 23rdSept 2009. I cannot let him go to casinos

Understand how gambling addicting can impact family quality

Activity

17. If money were a secondary issue, would you still be turned on by gambling?


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UNIT 4 (4.3) Some social problems with casinos

Some of the problems associated with the introduction of casinos are:

1. Increase in crime rate. When Deadwood, South Dakota, legalized gambling in

1990, arrests increased 250 %, reports of child abuse and neglect also

increased. Many families moved out. While New Jersey's Atlantic City attracted

33 million visitors annually, its local population shrank by 20%. The police dept

had to treble its budget and its crime rate is still the highest in the state.

2. Increase in under aged gamblers. Even though the casinos in Nevada and

Atlantic City set the age limit at 21 years for entry into the casinos, those below21 still manage to sneak in. The under aged gamblers often sell drugs, steal

money and commit crimes to fund their compulsion for gambling. In Atlantic City

alone in 1992, some 200,000 under aged youths were caught gambling in the

casinos. The wide use of video games in the casinos are likely to further

encourage the growth of pathological under aged gamblers

3. Increase in street crimes, prostitution, embezzlement, drugs and alcohol

abuse. and loan sharking.

4. Increase in bankruptcies and gambling debts and homelessness

5. Working under stressful shift conditions many casino employees take to drugs

and alcohol abuse and even become addicted to gambling themselves

Illustration

See Appendix 9 Straits Times report on 18th August 2009 "Most problem

gamblers get hooked at early age". Understand issues relating to under aged

gamblers.

Activity

18. Do you know of any pathological gambler? What is your experience? What


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would you do if a close family member became a gambling addict? Refer

Appendix 8. Straits Times 22nd Sept 2009. SMU group to educate young on

pitfalls of gambling. Understand the importance of peer pressure..

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UNIT 4 (4.4) The social cost of addictive gambling

One pathological gambler can affect 10 to 17 other persons. The social costs of

casino gambling would include:

1. cost of rehabilitating the addict

2. cost of resolving the gambling debts

3. cost to insurance companies

4. cost of reduced work productivity

5. cost of bankruptcies 6. losses through white collar crimes

7. cost of family problems

8. cost of abusive behaviour

9. cost of increased police budgets

What has been put on the spotlight in recent years is the way casinos advertise

to attract more customers. Some of the advertisements are focused on retirees

and young people.

Illustration

Refer Appendix7 Straits Times 25thSept 2009 15% of gambling addicts tried to

kill themselves. Understand how gambling addiction is a serious medical

condition.

Activity

19. Do you think we should control advertisements by casinos the same way we

control advertisements for cigarettes?

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UNIT REVIEW

The advocates of casinos often use the economic advantage approach. Thoseagainst casinos would use the sociological costs approach. Whatever the

viewpoints, it is clear that various preventive policies and a strong regulatory

framework has to be in place before a state/country embraces the casino

industry


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UNIT 5 Modern casino and gaming operations


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UNIT OBJECTIVES

I. Understand the strong growth of casinos

II. Appreciate some of the regulatory and control procedures within the casinoindustry

III. Understand how casinos market to customers

IV. Learning from the Niagara Frontier experience


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UNIT 5 (5.0) Operating a modern day casino-hotel

In the past, casino were more focused on the profits made from gamingoperations. With the modernization of the industry, today's casino is more likely

to have multiple revenue streams like hotel rooms, F&B, entertainment, and

others. The areas outside of pure gambling are considered as profit centers

whereas in the past, they were seen as loss leaders to generate a greater

volume of customers for the casino.

The gaming industry in the US has been growing at over 7% a year, with casinos

growing at an even faster rate of 13% within the gaming industry. There are

several reasons for this:

1. More states in the US need to generate funds for development without having

to increase taxes

2. Casinos are becoming more acceptable to the public with globalization and

greater exposure through travel

3. The view that "if the neighbors can benefit from casinos, why can't we?" is

becoming more prevalent

To illustrate how lucrative a casino industry can be we only have to look at LasVegas. In 1998, Las Vegas had over 30 million visitors, spending about $25

billion. Hotel occupancy averaged 87%, the gaming industry employed some

175,000 people directly, and close to 4000 conventions were held,

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UNIT 5 (5.1) Financial concerns and control

Customers in a casino either purchase chips to gamble with or they use cash.When a customer wins, he/she is usually paid with chips which he/she can

change for cash.

Some of the common jargons used in the industry are:

1. Drop. This is the money/chips that is collected from the customer. Casinos are

able to tell the amount of money collected from each table for each shift. It can

be a reflection of the dealer's skill.

2. Win. As each table is given an amount of money/chips to start with, any

excess in the drop over the bank represents the win

3. Hold. This is given in percentage terms and represents the win over the drop

(like gross margin)

For a casino the drop is more important than the win. If the drop continues to

increase, over the long run, the casino will make good money. Over the short

term, wins may be erratic. Different games will produce different odds; hence it

may be possible for the casino to actually lose on certain nights or for certain

tables but so long as the drop increases day by day, the casino will recover all itslosses over the long run and go on to make substantial gains.

For example, Frank Sinatra performed at Caesar's Palace in 1968 and was

responsible for attracting huge crowds to the casino. Over the first three days the

casino actually lost $1million but the drops continued to be strong and as Sinatra

performed for four weeks, the casino went on to recover their losses and made

more money

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Activity

All casino monies are eventually channeled to the cage. The cage represents the

financial hub of the casino and controls money as tightly as a bank. Like the

bank, they also make credit decisions and keep proper financial records of all

transactions. Cage personnel do not report to casino operations. They report to

the finance department and the Cage Manager reports directly to the Controller.

At the lower level, the cage assistant exchanges chips, issues credit, provides

safe deposit, approves "walking money", has custody of special keys, checks

and conducts routine audits.

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Activity

20. Have you been in a casino before or have you seen a movie that showed the

activities and ambience in a casino? If so, what was your impression?


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UNIT 5 (5.2) Regulatory standards

Regulations within the casino industry are usually strict and tight. There areregulations covering many areas such as:

1. quality - the facility has to be of a certain standard

2. public space requirements - it has to follow local zoning requirements

3. layout of facilities - the areas allocated to various games are very specific eg

for every "x" thousand sq feet, the casino is allowed to put "y" black jack tables,

"z" slot machines, etc

4. accounting records - this has to follow explicitly the guidelines laid down by the

Gaming Commission

5. Table and Slot drop counts - again the regulations laid down are very specific

especially the activities in the count rooms

6. Credit procedures - proper bank checks are needed, credit can only be

authorized by certain accounting personnel.

7. Game rules - the rules governing every game must be consistent and follow

the guidelines given by the commission and be available for all to see.

8. Employee Licensing - Minimum standards are set and personal historychecked thoroughly. There cannot be any criminal record or bad credit history

and field investigations can also be carried out.

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UNIT 5 (5.3) Marketing to casino customers

There are two kinds of customers:

1. the grind customer - these are usually the small players. They may change

$20 into $1 chips and slowly gamble them away

2. the premium customer who places huge bets and are often referred to as the

"high rollers"

With grind players the hold rate is pretty stable and does not vary very much. But

high rollers can cause large swings in the hold rates because of the huge bets

and the differences of the odds in the gameThe casino has to rely on repeat customers. The computer databases developed

for the casino industry can tell who the big players are, how much they spend

each time, what games they play and even for how long they would normally stay

with a game.

Certain groups like the independent business people have a tendency to take

higher risks and consistently lose a great deal of money.

Operators use all kinds of incentives to reach out to the regulars. Free air travel,

accommodations, etc can be offered. Read Appendix 13 to understand more

about the kinds of incentives that can be extended to high rollers.

The mid-range frequent gambler is much sought after. They can be attracted with

booze, parties and other incentives. The high end gamblers have a tendency to

switch casinos often.

"Walking money" is sometimes given out by cage personnel to high rollers who

have lost all their money in the casino and the "walking money" takes care of

their needs for the rest of their stay, excluding gambling money, of course.

Casinos are becoming increasingly dependent on credit customers. 40% of

gambling money in Las Vegas is based on credit. In Asian markets this figure

can be as high as 90%. Every year casinos need to write off a substantial


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amount of bad debts.

IllustrationRefer Appendix 11 Straits Times 15 th )ct 2009 Whereabouts of gambler stumps

all. Understand the risks associated with casinos granting credit to customers.

Activity

21. Given that casinos have to write off large amounts in bad debts each year,

why do you think they would want to continue with the credit system?

Content

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Activity

22. Are you a grind customer or a potential high roller? What benefits would you

expect from a casino if you were a high roller?


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UNIT 5 (5.4) How gaming helped save the Niagara Frontier

Although the Niagara Falls is one of the wonders of the world and attracts many

visitors each year, the area suffers from seasonality. The Niagara Frontier suffers

from a lack of tourist arrivals in the winter and spring months. Plant closings and

lay offs had also turned this once economically booming area into a place of high

unemployment and many welfare receivers. Initial studies found that the area

would be able to benefit substantially from a gaming casino. It was estimated that

some $545 million would be spent on gaming, yielding almost 29,000 jobs.

Opened in 1996, the Niagara Falls casino complex in Ontario is one of the mostsuccessful in the world. It has lived up to its expectations in job creation, revenue

generation, tourism development, and community development.

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UNIT REVIEW

Casinos today have come a long way from the mobster controlled image to one

that is legitimate and family friendly. Governments are aware of the methods they

need to employ to keep the casinos well regulated and to put in place facilities to

cushion the sociological downside of gambling. This twin approach is necessary

to derive maximum benefit from the casino industry and minimum cost to the

people.


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UNIT 6 The future of the casino industry


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UNIT OBJECTIVES

I. Understand how the industry is likely to change in the future

II. Appreciate the need for change in human resource policies within casinosIII. Understand the impact of technological changes

IV. Appreciate how globalization has affected cultural attitudes toward casinos


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UNIT 6 (6.0) How the industry is likely to be perceived in the future

We can be certain that there will be more and more casinos worldwide in thefuture as well as an increase in the types of gaming devices.

It is estimated that in the US more than 95 million people visited casinos in 1998

alone. There are more people going to casinos than there are watching

Broadway plays, musical events, or concerts.

In the future casino patrons are expected to be younger and better educated.

Conditioned by modern day influences and the desire to make a fast buck, the

new generation will take to casinos because of their desire for immediate

gratification. Better accessibility and more casinos will lead to more players in the

industry.

Cheaper transportation and a growing desire to travel, especially amongst the

younger generation, will generate more support for the casinos from customers

overseas. As the world moves toward becoming a global village , peoples

perception of the casino is likely to change and with all the attractions of an

integrated resort, the casino will become more and more a place of entertainment

rather than pure gambling.Previously, in America, there was only Nevada and Atlantic CIty. Now it is

possible to find gaming facilities scattered all over the US, including those on

cruise vessels, in the Riverboats and in Native American reservations.

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The social cost of gambling will continue to be a concern in the future. Minorities,

low-income and underage individuals will continue to need help from the

government and other volunteer groups. Countries that are considering legalizing

casinos must be constantly aware of the need to ensure that criminal elements

do not infiltrate the industry. Once a community feels that a casino is poorly

regulated or its integrity compromised, the casino be unlikely to succeed.

There is constant pressure from interested parties in Nevada and Atlantic City to

loosen the controls and the government must be strong enough to withstand

such pressure groups.

Social concerns must be tackled proactively and treatment centers and

preventive measures legislated.

Illustration

See Appendix 14 Straits Times 16th Sept 2009 on "Changes Made to Casino

Control Act". Understand the concerns of the Singapore government in regulating

the casino industry.

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UNIT 6 (6.1) How human resource in the casino industry is likely to change

Presently the casino industry is faced with the following manpower problems:

1. growing incidence of sexual harassment

2. high turnover rate

3. greater addiction to drugs , alcohol and gambling addiction

4. employee shortage

5. insufficient numbers of better qualified personnel at various levels

In the 1980s there were few tertiary institutes that offered casino operations as a

course. Today in the US there are more than 50 courses being taught. It is now

possible to obtain a graduate degree in casino management. Casinos have also

gone out of their ways to participate in job fairs to attract better quality people into

the industry. The introduction of new games makes in-house training an on-going

activity.

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Activity

23. Do you feel that working in a casino is special and very different from other

jobs in the hospitality and tourism industries?

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UNIT 6 (6.2) The impact of technological changes

Technology is expected to change the way companies work in the future.

Likewise in the casino industry, the technological impact will also be felt in

several areas:

1. the innovative virtual-reality games. The younger generation have become

accustomed to playing virtual reality games over the computer. The casino has

been quick to adapt the same technology so that the younger customers can

continue to play these games, albeit in a gambling fashion, within the casino.

These are becoming addictive to the young.2. the greater use of touch screens in many new games. More games can now

be played on a single machine. It is left to the discretion of customers to decide

which they would consider their lucky games for the day. They have the option to

switch back and forth between several games to try to find the lucky streak.

3. Internet gaming. They can pose a threat to casinos but can also be harnessed

to the casinos advantage. Although illegal in the USA, governments are virtually

powerless to prevent the growth of internet gambling. Even if the computer used

for gaming can be traced, it would be very difficult to prove who the player was.

Internet gambling is expected to generate over $18billion by 2010 in the US

supported by close to 2000 gambling sites.

4. use of credit cards to activate games. This would probably encourage more

people to try their luck in the casino. It also effectively passes the credit risk to

the credit card company instead of the casino.

5. Computers are changing the way casinos are able to track down the high

rollers, understand their gambling profiles and allow the marketers to reach out to

them in a more effective way. It would be difficult to work out the level of

complimentaries for each high roller without the help of computerized data.

6. They have become an indispensable part of operating a casino-hotel.


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Computers generate a great deal of data in a very short time, enabling managers

to make better decisions. Technology has also made it possible for all the various

activities and services in an Integrated Resort to be better co-ordinated with

increased work productivity.

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Activity

24. Do you feel that internet gambling will replace the casino one day?

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UNIT 6 (6.3) Geographical Expansion

Once governments are comfortable with the idea that a strong regulatory

framework coupled with proactive social nets are all that is needed to control the

casino industry, then it is very likely to be supportive of casinos.

The Asian and Pacific rim countries are likely to see a proliferation of casinos in

the near future.

Mega casino operators in the US are also interested to move beyond the shores

of the USA. They can see the potential in Asia because of large populations and

growing wealth.

The casinos in Macau have become bigger than Las Vegas in revenue terms in a

few short years.

Non-gaming activities within the resort complex are also becoming important.

The Las Vegas experience shows that more and more, people are spending on

shows, food, and shopping instead of gaming. Theme concepts and family type

packages are catching on. Read Appendix 12 $66 for a day pass to Universal

Studios Straits Times 19th Nov 2009. to appreciate the contribution made by a

casinos non-gaming attraction. Given the number of visitors expected, therevenues can be quite significant.

As more and more Asian countries go into the casino industry to attract more

tourists and generate higher tax revenues, it will attract more casinos as no

country wants to be left out of such a seemingly lucrative business.

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Activity

25. If every country were to develop its own integrated casino resort, what will

happen? Will its popularity ironically lead to its own demise in the future?


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UNIT 6 (6.4) Casinos are becoming bigger and more expensive

ContentAlthough boutique casinos do exist, the trend is toward building bigger and more

expensive casinos in new markets as casino operators try to outdo one another

in terms of grandeur and size. The two new casinos that will surface in Singapore

in 2010 will each cost about US$2-$3 billion. With such huge investments,

operators and owners are not likely to share any pessimistic outlook of the

industry in the future. The size of the investments have also made it necessary

for some owners to raise funds through the equity markets..

Within the more established Las Vegas strip, MGM Grand alone boasts of a

5000 room hotel. Others like Foxwoods can lay claim to having over 7,000 slot

machines, over 300 table games , 25 restaurants and employing over 11,000

workers.

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Activity

25. I. Nelson Rose in his article The rise and fall of the third wave believes that

the casino industry goes through 70 year cycles and by 2029, the casino industry

will come to an end. Do you share this view? If not, why?

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UNIT 6 (6.5) The effect of globalization

It is likely as people and goods move more frequently from country to country in

an increasingly borderless world, perceptions of gaming as an undesirable

industry is likely to change, facilitated by the transformation of casinos into

wholesome Integrated Resorts. Countries are likely to want a slice of the action

when they see their neighbors reaping the positive benefits of the casino

industry. Massachusettes would probably like to see the money lost to the

casinos in nearby Connecticut flow back to the state. Many Asian countries are

contemplating whether to introduce the casino industry into their economies after

watching the successful launches of mega projects in Macau and the future

developments in Singapore . As governments achieve greater confidence in the

provision of safety nets for gambling addiction, they may feel that the casinos

ability to re-vitalize a city and to generate significant revenue streams, not only in

gaming but through its multiplier effect, would be sufficient to tip the scale in favor

of a casino.

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UNIT REVIEW

There will always be someone who will see the casino as an opportunity to make

a fast buck; a way out of their financial problems. But more and more casinos areleaning towards providing a form of wholesome entertainment for the entire

family through their non-gaming facilities and attractions.

Intro to Casinos - Matrerial

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Transcript of Intro to Casinos - Matrerial