The fact is that U.S. casinos are reputable businesses predominantly owned and operated by public companies, and all of them, public and private, are heavily scrutinized by state and federal regulators. Movies such as “Bugsy” and “Casino” may portray the industry otherwise, but they are simply fictional accounts.
The National Gambling Impact Study Commission (NGISC) put to rest decades-old assumptions about organized crime and its involvement in the gaming industry. As it stated in its 1999 report: “All of the evidence presented to the commission indicates that effective state regulation, coupled with the corporate takeover of much of the industry, has eliminated organized crime from the ownership and operation of casinos.”(1)
As state-regulated businesses, casinos are subject to some of the most comprehensive regulations of any industry in the country. The activities of gaming companies are tightly monitored by state gaming regulators, who license and oversee their operations, conducting hearings, background checks on all personnel employed by the facility, among other research methods that aim to detect ties to organized crime and any other illegal activity. These various government measures make it almost impossible for organized crime or other illegal cartels to infiltrate the heavily scrutinized commercial casino industry.
Funded by tax dollars from gaming, a large work force of regulators in each state monitors industry activities. Nevada alone employs 432 regulators at a cost of nearly $30.8 million, while New Jersey employs 714 regulators at a cost of $62.7 million. The annual budgets for gaming industry regulation in Louisiana and Missouri both top $20 million. The total cost of regulation in fiscal year 2002 in the 11 commercial states was more than $202 million, with 2,455 regulators and support staff helping to ensure that only legitimate interests are involved in this business.
Since most U.S. casino operators are publicly held corporations, they also are subject to scrutiny by the Securities and Exchange Commission (SEC). Like other businesses, casino companies must comply with strict federal standards to prevent money laundering and other illegal activity.
In addition to these safeguards, a series of federal laws have been put in place since the 1950s to keep organized crime out of gaming. From the Gaming Devices Act of 1951, the Special Rackets Squad of the FBI and the 1961 Wire Communications Act, which set the benchmark for scrutiny of the gaming industry, to the recent creation of the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) to prevent money laundering activities, gaming is one of the most highly regulated business sectors in the United States.
- National Gambling Impact Study Commission, Final Report (Washington, D.C.: GPO, June 1999), 3-1, 3-2.