BetMGM will take over the operations of MGM Resort International’s Las Vegas sportsbooks this summer, a company legal counsel said Wednesday.
BetMGM, the joint venture between Entain and MGM that operates across the U.S., introduced its mobile sports betting app to Las Vegas in early 2024, but MGM retained operational control. The enhanced app complements MGM Resorts’ nine sportsbooks on the Las Vegas Strip.
Wednesday’s recommendation to the Nevada Gaming Commission is another step in the licensing process, allowing the takeover after a previous approval in December.
BetMGM private counsel Scott Scherer said that before any entity is licensed to conduct a satellite race and sportsbook, Nevada law requires that it must first operate a brick-and-mortar casino with a retail sportsbook. BetMGM was previously licensed as a manufacturer, distributor, and operator of the sports information service. Shortly thereafter, it was registered as an information-technology service provider.
“This licensing structure was discussed with the Board chair at the time and we believed it was adequate to allow BetMGM to have substantial involvement in the race and sportsbook operations of MGM Resorts and its subsidiaries. But over time, concerns arose about BetMGM’s role in the race and sportsbook operations,” Scherer said. In response to that, BetMGM sought additional licensing as a “key employee” to manage those operations, which was granted in December.
The licenses discussed Wednesday were for BetMGM as the operator at the nine casinos. If approved by the Nevada Gaming Commission later this month, it will take over the hub at Mandalay Bay and the other sportsbooks would be satellites.
Because of the complications of the transition, it would happen when sports betting slows down following the NCAA basketball tournament and opening of the Major League Baseball season. The timeline is mid- to late summer prior to the start of the football season. But it’s possible it could take even longer for the transition.
“We want to make sure it’s done right and that everything is in place,” Scherer said.
MGM asked BetMGM to serve in this role, because of their expertise and staffing.
While awaiting the transition, both MGM and BetMGM would work on the audit controls covering MGM’s role in the operation.
Entain private counsel Erica Okerberg updated the Board on Entain CEO Gavin Isaacs’ abruptly stepping down this week after assuming the role in September. Board Chair Stella David has stepped in as interim CEO after serving the same interim role in the past.
Okerberg said the transition will be straightforward. David has an application with the Board and will work with the investigative staff.
Entain also updated the Board on AUSTRAC’s taking Entain to federal court in December over non-compliance with Australian money-laundering laws.
Entain General Counsel Simon Zinger said the company has kept the Board apprised as the case progresses and that Entain has cooperated.
After what’s called a “statement of claim” is made in March, Zinger said Entain will enter discussions and mediation with AUSTRAC, which they hope will take place later in the year.
“The initial statement alleges deficiencies in Entain’s AML program in various areas, including risk-based assessment and controls, transaction monitoring, source funding, due diligence, and suspicious activity reporting,” Zinger said. “These issues are localized to the Entain Australia business. With support and oversight of Entain PLC, Entain Australia throughout the past two years put into place significant measures to mitigate and manage risk under its AML program. The goal was to bring Entain Australia in line with Entain PLC expectations for each of its companies within the group.”
Entain Australia has already taken action to correct many of the deficiencies noted by AUSTRA in the complaint, Zinger said.
Nevada Gaming Control Board Chair Kirk Hendrick said what happens with its licensees outside of the state is important and AML issues get their attention.
“I’m not concerned with somebody betting a few hundred dollars, but the large bets of $100,000 to $200,000, what type of source of funds or verification would BetMGM undergo?” Board member George Assad asked of the operator in Nevada.
BetMGM said it has a robust AML program under the joint venture with a team of 40 in mobile and retail sportsbooks. No one can make such a large bet without being identified.
Powered by Entain, the BetMGM Nevada app offers sports fans what is called “significant enhancements” to the mobile sports betting experience, including an exponential increase in prop and parlay wager options, live streaming capabilities, digital deposits and withdrawals.
