The Nevada Gaming Control Board last week came down hard on CG Technologies for allegations that it shorted thousands of winning bettors by more than 0,000 more than 20,000 times from late 2011 until early 2015. The board fined the former Cantor Gaming .5 million and forced its president, Lee Amaitis, to resign, effective August 31. The Nevada Gaming Commission still must hear the case before the penalties go into effect.
The board alleged that the errors came about because of “systematic problems” with CG’s computerized bookkeeping operations. More seriously, however, the board alleged that CG failed to adequately address or report the problem to regulators. CG also overpaid gamblers to the tune of more than $100,000 for 11,000 bets, as well.
CG has said it cut checks to those individuals who were shorted, but set aside $25,000 in escrow for any situations it may have missed.
It was the second run-in with state regulators for CG. As Cantor Gaming, one if its senior executives, sports book director Mike Colbert, was one of eight arrested nationwide in an illegal sports betting ring connected to off-shore online sportsbook Pinnacle Sports in 2012. Cantor immediately fired Colbert and denied any knowledge of the operation, but questions remained how Colbert could have conducted this activity without the raising any red flags. The GCB fined the company $5.5 million for that incident.
Amaitis, meanwhile, has been the driving force behind Cantor Gaming and CG Technology since it literally rose from the ashes of the September 11 World Trade Center collapse in 2001, where hundreds of Cantor Fitzgerald employees perished. In the 1980s, Amaitis pled guilty to cocaine possession, when as a bond trader he became involved in a million-dollar drug ring on Wall Street.
The GCB ordered CG Technologies to conduct a search for Amaitis’ replacement and submit that candidate for licensure within 30 days.
The company had also been warned two years ago about the computerized sports betting system that any further violations could mean a revocation of its gaming license.
“Public confidence and trust can only be maintained by strict gaming regulation,” GCB 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.”
