Gambling Regulation Bodies in The United States

Over the past quarter century, legalized gambling in America has undergone a rapid expansion. Once an infrequent experience tinged with the exotic— a trek to the distant Nevada desert once was a common requirement for those seeking casino gambling— it has since become a common feature of everyday life, readily accessible in one form or another to the vast majority of Americans. As it has grown, it has become more than simply an entertaining pastime: The gambling industry has emerged as an economic mainstay in many communities, and plays an increasingly prominent role in state and even regional economies. Although it could well be curtailed or restricted in some communities, it is virtually certain that legalized gambling is here to stay.GAMBLING REGULATION 1 Over the past quarter century, legalized gambling in America has undergone a rapid expansion. Once an infrequent experience tinged with the exotic— a trek to the distant Nevada desert once was a common requirement for those seeking casino gambling— it has since become a common feature of everyday life, readily accessible in one form or another to the vast majority of Americans. As it has grown, it has become more than simply an entertaining pastime: The gambling industry has emerged as an economic mainstay in many communities, and plays an increasingly prominent role in state and even regional economies. Although it could well be curtailed or restricted in some communities, it is virtually certain that legalized gambling is here to stay.
Despite its increasing familiarity, nowhere is gambling regarded as merely another business, free to offer its wares to the public. Instead, it is the target of special scrutiny by governments in every jurisdiction where it exists, including even such gambling-friendly states as Nevada. The underlying assumption— whether empirically based or not— is that, left unregulated and subject only to market forces, gambling would produce a number of negative impacts on society and that government regulation is the most appropriate remedy. Thus, the authorization of

1 Regulating Casinos Gaming: A View from State Regulators by Michael A. Belletire, Administrator of the Illinois Board. This document was developed for the NGISC at the request of the Commission’s Subcommittee on Regulation, Enforcement, and the Internet. Direct contributions to the content and topics discussed in the document were made by the following individuals: Steve DuCharm and Dennis Neilander (Nevada), Frank Catania (New Jersey), Chuck Patton (Mississippi), George Turner (Colorado), Mel Fischer (Missouri), Jack Thar (Indiana), Jack Ketterer (Iowa), Hillary Crain (Louisiana), and Mac Ryder (Illinois). This chapter also benefited from state reports submitted directly to the Commission. For example, see New Jersey Casino Control Commission, Casino Gambling in New Jersey: A Report to the National Gambling Impact Study Commission (January 1998) and Mississippi Gaming Commission, Regulating Gaming in Mississippi: Policing an Unprecedented Phenomenon: A Report to the National Gambling Impact Study Commission (1998).

legalized gambling has almost always been accompanied by the establishment of a corresponding regulatory regime and structure.

GOVERNMENTS SET THE RULES> Much of gambling regulation is focused on policing functions that differ little from community to community. The most immediate of these is ensuring the integrity of the games offered, a function often valued most by the proprietors of gambling establishments themselves. In the popular imagination, the “con” man forever hovers in the shadows of gambling; and, in truth, without the stern presence of independent regulators, it would require little effort to conjure methods of conflating “games of chance” with outright deception. Thus, to the extent that governments assume a general responsibility to shield their populations from fraud, regulation is the most effective means of ensuring that such legal gambling as does exist is fair and honest.

A second area of government concern is crime, especially organized crime. Fairly or not, Nevada’s casinos were once closely linked in the popular mind with organized crime, a bias given substance by repeated federal and state investigations and prosecutions of casino owners and operators. Because of the volume of cash transactions involved in casino gambling, and in order to minimize any resulting potential for money laundering, casinos must comply with requirements regarding the reporting of these transactions. All of the evidence presented to the Commission indicates that effective state regulation, coupled with the takeover of much of the industry by public corporations, has eliminated organized crime from the direct ownership and operation of casinos.

GAMBLING AND THE PUBLIC INTEREST In addition to these relatively well-defined policing functions, a broader and far more important role for government regulation is

Despite its increasing familiarity, nowhere is gambling regarded as merely another business, free to offer its wares to the public. Instead, it is the target of special scrutiny by governments in every jurisdiction where it exists, including even such gambling-friendly states as Nevada. The underlying assumption— whether empirically based or not— is that, left unregulated and subject only to market forces, gambling would produce a number of negative impacts on society and that government regulation is the most appropriate remedy. Thus, the authorization of

legalized gambling has almost always been accompanied by the establishment of a corresponding regulatory regime and structure.

GOVERNMENTS SET THE RULES
Much of gambling regulation is focused on policing functions that differ little from community to community. The most immediate of these is ensuring the integrity of the games offered, a function often valued most by the proprietors of gambling establishments themselves. In the popular imagination, the “con” man forever hovers in the shadows of gambling; and, in truth, without the stern presence of independent regulators, it would require little effort to conjure methods of conflating “games of chance” with outright deception. Thus, to the extent that governments assume a general responsibility to shield their populations from fraud, regulation is the most effective means of ensuring that such legal gambling as does exist is fair and honest.