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Las Vegas • Nevada regulators said Thursday they'll let one of the state's largest sports book operators stay in business after years of underpaying winning gamblers because the Las Vegas company is ousting its CEO.
The Nevada Gaming Commission approved a $1.5 million settlement with CG Technology over miscalculations on its computerized betting system that date back to 2011.
Commissioners said they would have revoked the business' gambling license but the impending removal of CEO Lee Amaitis made the settlement easier to accept.
CG Technology's lawyer Mark Clayton said the company had properly provided refunds to 96 percent of affected gamblers. The company also said it voluntarily began independent compliance reviews to ensure the problem doesn't happen again.
It denied that it tried to profit from the system errors.
Commission Chairman Tony Alamo said he was disappointed that the company previously known as Cantor Gaming, which pioneered mobile gambling, would be involved in a second scandal.
"You can't erase what I know. I've been here too long," Alamo said.
Just two years ago, CG Technology was accused of failing to adequately supervise its former sports book director, who was accused of being involved in a nationwide sports betting ring.
The company was fined $5.5 million — the largest settlement penalty in state history. Amaitis was not cited in that complaint, but the state said he should have known about the problem.
CG Technology runs the sports books at the Cosmopolitan, Venetian and Tropicana casinos on the Strip, as well as the M, Hard Rock, Palms and Silverton casinos. It was the first company licensed by state regulators to manufacture and operate a mobile gambling system.
The Nevada Gaming Control Board in May accused the gambling company of a series of egregious violations, including underpaying 20,000 winning bets by a total of $700,000 between August 2011 and March 2015, accepting bets after a match and knowingly withholding information.
As part of the latest settlement, the company will set up a $25,000 escrow account to pay out any remaining gamblers who were shorted. Underpaid winners have a one-year period to claim and prove that they were stiffed and any remaining escrow funds will be donated to the Nevada Council on Problem Gambling.
The commissioners said it was a "fundamental must" for players to know they won't be cheated but it would be impossible to issue refunds to every gambler in the case because some amateur bettors may not understand their payout or may not care enough to go through the process of validating their years-old tickets.
"The wrong won't be made right, and that's just what it is, and that's sad," Alamo said.