Posted: June 25, 2022, 1:32 a.m.
Last update on: June 25, 2022, 01:42h.
The Nevada Gaming Commission on Thursday fined Station Casinos $80,000 for accepting bets on sporting events when the outcome was already determined.
Last September, the Nevada Gaming Control Board (NGCB) filed a lawsuit against the Las Vegas-based gaming company after Station reported a server malfunction that led to its mobile sports betting app taking 167 bets on events. already completed.
This was on top of a similar issue discovered in June 2018, an incident that led the NGCB to notify the company of a breach three years ago. In total, nearly 350 abusive bets were accepted from June 2018 to March 2021.
All bets were ultimately void.
The settlement between the state and the Station was discussed for 25 minutes at Thursday’s NGC meeting. As part of the settlement, station officials accepted the fine without accepting or denying the NGCB allegation.
However, respondents specifically admit that they failed to maintain their virtual servers that their mobile sports betting app was running on,” John Michela, Nevada’s senior assistant attorney general for gambling, told the commission. “That this failure may have led to the acceptance of stretch bets posted in the past, and that this virtual server maintenance failure occurred after respondents responded to a 2019 (order of justification), which included apparent violations regarding server maintenance.”
The show cause order explicitly stated that Station needed redundancy in its oversight processes to ensure no bets were made on completed events.
The station is “justified” when the problem arises elsewhere
Marc Rubinstein, a lawyer representing Station Casinos, told commissioners that a “flaw” in the sports betting software had caused the server’s memory banks to fill faster than expected, leading to the problem.
In response to the 2019 cause-and-effect order, Rubinstein said station officials determined they could “work around the loophole” to prevent it from happening again. This solution involved setting up alarms on the servers to notify staff when their disks reached 85% capacity.
While he said that didn’t completely fix the problem, Rubinstein also noted that the NGCB never asked Station to take further action. In March of last year, however, a server without an alarm reached memory capacity and allowed the problem to reoccur.
Beyond that, however, there have been other past conclusion betting incidents that have occurred that were not caused by the memory issue. One of them, according to Rubinstein, led several sportsbooks to take such bets.
“That’s kind of what rushed us into accelerating a discussion on settling the case,” said Rubinstein. “Because frankly, from our perspective, we felt vindicated in our original position that a complaint really shouldn’t have been filed and we’re really fixing that – even though it’s, we think, a number very high – settling for nuisance rate. Because it would be very expensive to plead.
Switch to a new platform
Station Casinos is changing its sports betting technology platform. Last October, GAN Limited entered into an agreement with Station to develop new infrastructure for the company’s STN Sports operations.
The GAN platform will span online infrastructure, mobile apps, retail and kiosks across Station’s 19 casinos in Nevada.
Rubinstein said it could take up to 18 months for GAN to obtain a license in Nevada, but added that the company had little choice in the matter.
“There aren’t many of these systems that have been approved in the state, and if we went with one that did, we would basically be dealing with a competitor,” he said.