Navigating Nevada Gaming Applications: Lessons from Recent Hearings

This article was co-authored by Don Lee, Law Clerk.

In Nevada, individuals and entities involved in the gaming industry may be required to undergo a rigorous licensing or suitability process administered by the Nevada Gaming Control Board (NGCB) and the Nevada Gaming Commission (NGC). This process applies not only to operators and executives, but also to key employees, investors, and certain vendors, depending on their role and level of influence. Being licensed in Nevada is a privilege—not a right—and applicants must meet the highest standards of honesty, transparency, and cooperation throughout the investigation. The process is thorough and often invasive, reflecting the state's commitment to maintaining the integrity of its gaming industry.

Recent NGCB proceedings have highlighted challenges and areas of concern, which have led to significant delays, scrutiny, and potential denial of licensure. Applicants should be mindful of these principles throughout the licensing process to avoid delays, scrutiny, or adverse outcomes.

Maintain Honesty and Integrity 

The statutory requirement for suitability mandates that an applicant be a person of good character, honesty, and integrity. Any actions that demonstrate untruthfulness or deception are viewed as a breach of this standard.

• Avoid deception: Do not make untruthful statements, even when faced with immediate confrontation or panic. A recent applicant was criticized for untruthfulness and covering up actions.
• Promptly resolve historical misconduct: If an applicant has made a prior mistake, failing to proactively and promptly address the issue, particularly when resolution is delayed until seeking re-entry into the gaming industry, can raise serious concerns about the applicant’s motivation and overall integrity.

Ensure Full and Continuous Transparency and Disclosure 

Applicants must provide all requested information completely and continuously update their applications throughout the multi-year investigative period.

• Disclose all financial information: Failing to disclose all bank accounts is considered a serious oversight.
• Disclose all relevant relationships and assets: Applicants have been criticized for failing to disclose major personal assets, such as houses purchased internationally, or rental properties used as residences, even if temporary.
• Disclose financial sharing: Sharing finances with others must be disclosed to agents to allow for investigation. Applicants are routinely questioned extensively about payments made to others for various purposes.
• Understand personal responsibility: The burden of ensuring timely and complete documentation rests entirely with the applicant, regardless of reliance on internal or external compliance staff. Relying on compliance teams and neglecting personal oversight is not an acceptable excuse for non-disclosure.

Guarantee Full Cooperation and Appropriate Conduct with NGCB Agents 

The NGCB demands respect and complete cooperation from all applicants. Failing to cooperate fully and timely can result in significant delays, increased costs, and self-inflicted injuries to the application process.

• Timely response to requests: Delays in providing requested documentation, such as application updates or necessary financial statements, are unacceptable. In one case, an applicant was criticized for his poor communication and failure to prioritize the agents' heavy investigative lift.
• Surrender requested devices immediately: Applicants should be aware that the NGCB may request access to personal devices, such as cell phones or laptops, as part of its investigative process, and such requests must be complied with promptly for a smooth investigative process. Failure or delay in handing over devices, such as a cell phone, when requested by agents is a major point of concern.
• Maintain professional decorum: Applicants must avoid hostile, belligerent, disrespectful, or arrogant conduct toward agents. For example, raising one’s voice to agents is unacceptable.
• Self-regulate and show emotional intelligence: NGCB members emphasized that applicants, especially those in senior leadership roles, must demonstrate high emotional intelligence and self-awareness, ensuring communications are not perceived as rude, disrespectful, or uncooperative.
• Provide crisp and direct answers: Applicants must provide clear, specific answers during interviews. Providing vague, confusing, or contradictory information may delay or cause problems to the process.

Ensure Robust Corporate Compliance and Policy Adherence 

The commitment to compliance must be evident at all levels, demonstrating that the organization prioritizes regulatory requirements over business convenience.

• Adhere to internal policies: Violation of company policy, such as the acceptance of gifts exceeding policy limits or violations of fraternization policy, reflects poorly on the applicant's character and judgment.
• Understand licensing nuances: Misunderstanding filing requirements, even if unintentional, can lead to gaming violations.

Role of Counsel During the Investigation

The role of legal counsel in the licensing process is critical and can significantly influence the outcome of the investigation. Given the complexity, sensitivity, and high stakes involved in the licensing and suitability process, experienced counsel can help applicants navigate the procedural and substantive challenges that arise. Counsel may play three important roles during the investigation.

First, counsel serves as the “point person” for coordinating the agents’ requests for documents or information. Requests are usually made by letter to the applicant with copies to his/her counsel or by telephone call to counsel. The speed and accuracy of the assembly and transmission of requested information has a direct impact upon the length and cost of the investigation. By coordinating the production of documents and information, counsel can review the materials for responsiveness, clarity, accuracy and completeness. The applicant’s level of preparation and cooperation largely determines the length and expense of the investigation.

Counsel’s second role is that of an “observer.” If requests are made without notice to the applicant’s counsel, the applicant should inform counsel of the request. By analyzing the nature of the information requested and observing the direction of the investigation, counsel can make educated guesses about the agents’ concerns or areas of interest. With this knowledge, the applicant has the ability to dispel any misconceptions and to prepare any necessary rebuttal ahead of time for the Board and the Commission hearings.

Counsel’s third role is “presenter.” An applicant’s counsel, being familiar with the Board and the Commission hearings, will be presenting and introducing the applicant in front of the Board and the Commission. This also provides counsel the opportunity to control the narrative (to the extent possible) and avoid having embarrassing details revealed in a public forum.

If you have any questions about this alert, please contact the authors or the Womble Bond Dickinson attorneys with whom you normally work.