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About The Bear

LV Bear is a longtime advantage player based in Las Vegas with extensive knowledge of the gaming industry.

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The Bear Growls: MGM Grand and Gaming Control Board conspire to harass patron trying to cashing chips

By LVBear | March 9, 2007

The news article Chips no longer good as cash details the policy of MGM Grand of hassling patrons who are cashing $5000 chips. Based on published reports, MGM Grand has refused to cash chips for winning patrons more times than any other casino. If Nevada had a legitimate Gaming Control Board, this despicable practice would have been stopped long ago. The MGM Grand should have been heavily fined and the individual employees responsible for this harassment of patrons should have been fired and banned from the gaming industry. Unfortunately, the Chief of Enforcement, long-time Control Board employee Jerry Markling misstates the facts:

“Initially the burden of proof is on the person with the chip to show how he obtained it through legitimate means,” said Jerry Markling, chief of the Gaming Control Board’s enforcement division. But if the chip is seized and the customer complains to state regulators, the burden shifts to the casino to prove its case.

The patron has no such burden. Mr. Markling obviously knows this; he misstated the regulation to the reporter. The regulation in question is Nevada Gaming Regulation 12.060, which states in pertinent part:

4. A licensee shall not redeem its chips or tokens if presented by a person who the licensee knows or reasonably should know is not a patron of its gaming establishment …

Clearly this burden is on the casino, not the patron. Mr. Markling is not ignorant of this fact. From that, I must conclude that he deliberately misstated it to Las Vegas Sun reporter Liz Benston to protect the casino industry, which has a vested interest in harassing winning players. I can’t think of any other rational explanation for his false statement. It is unfortunate that Ms. Benston, who is usually a good, thorough reporter, apparently did not follow up or challenge Mr. Markling’s statement.

In Beat the Players, Bob Nersesian wrote:

An occurrence within Nevada is gaining some prevalence. When a patron presents a high value of chips, some casinos are confiscating these chips and returning a receipt rather than legal tender. The excuse given is that per regulations they can pay only patrons, and the person presenting the chips is not known as a patron. The incidents increase with the value of the chips, and high value chips such as chocolate ($5000) chips draw instant scrutiny.

With this said, the compliance with this rule may prove difficult. If a cashier wants to get higher level approval, demand that the chip(s) remain with you. If the manager demands to examine the chip, have him come outside the cage. Ideally, before the chip(s) are given up, see the green counted out on the counter, and if the cashier makes any move to absent themselves with the chip, demand that it be returned and that any inquiry take place face to face with you having access to your chip(s). If there is any question, simply inform the cashier or supervisor that you have read of casinos just taking chips from players, and that you are protecting against this occurrence. Also, inform them that possession of the chip has nothing to do with determining whether or not you are a patron. Of course, if you are a player with a player’s card that supports the win, all of this becomes largely moot because you will very likely be paid and told “Thank you.”

On a different level, avoid the high denomination chips. This, of course, is harder than it may appear. Protecting goodwill and anonymity may well turn on willing compliance with requests of the pit boss or dealer. Demands to color-up can be direct and almost oppressive. Indeed, a dealer or pit boss can make it sound like you have no choice.

Still, quickly standing, pocketing the chips on the table, and walking away can suffice. Alternatively, limiting a payout to blacks may occur on a statement that you are just going to another table. I have also seen chocolate chips avoided by a patron stating that he would never want to carry a $5000 bill, and certainly doesn’t want to carry a $5000 chip. The smaller the denominations, the easier it will be to leach out full payment without inquiry. If the casino ever gets its hands on one or more of these big chips, you have bought a gaming dispute with all its attendant disclosure requirements, and the corollary loss of anonymity with respect to that casino. This is obviously a result to be avoided.

There is also the question as to why the casino can take the chip and not pay. There are conflicting laws on this, and that presents the difficulty. First, chips are expressly defined in the regulations as a “representative of value issued by a licensee.” More importantly, once issued, the chips “evidence a debt owed to their custodian.” The regulation expressly states “custodian,” thereby rendering chips a bearer item. The regulation does not say “patron,” does not say “customer,” and does say “custodian.” Thus, chips represent a debt owed by the casino to the person in custody of the chips.

Against this clear statement of a debt, there is a conflicting provision that states, “A licensee shall not redeem its chips or tokens if presented by a person who the licensee knows or reasonably should know is not a patron of its gaming establishment . . .”. So, the end result is that it is possible to have a non-patron who is owed an express legal debt by the casino, but the casino has a corresponding duty to not redeem those chips. This truly appears to be an irresolvable conundrum under the law.

Still, the proscription is that the casino “not redeem” the chips. There is no right, implied or express, that the casino may confiscate this representation of a debt owed to the custodian. It appears that the casino, if it knows that the presenter is not a patron, is restricted to telling the presenter that they cannot redeem the chip from him. The obvious way around this is to give the chip to a “patron” in order that the “patron” can redeem it.

I would also suggest that the burden under the regulation allowing for a refusal to redeem is on the casino. Note that the language says that the casino cannot redeem a chip from someone that they “know” or “reasonably should know” is not a patron. First, if the presenter is a “patron,” then there is no excuse whatsoever for failing to redeem. If you could ask the casino a question such as, “How do you know that I am not a patron?”, and no answer can be given, then the casino is obviously outside the regulation in refusing to redeem. Maybe carrying a copy of Nevada Gaming Regulation 12.060, showing it to the cage boss, and pointing out the unsuitable practice of refusing to redeem could result in prompt payment. When the gaming agents arrive, do the same. Again, it is the casino’s burden, and if such a course is taken it should be repeatedly pointed out that you don’t have to justify or prove yourself as a patron, the casino has to prove you aren’t or weren’t.

You might even walk over to a machine, put in a quarter in front of the cage personnel, and say, “Now I’m a patron, pay me.” The regulation does not restrict the redemption of chips to persons who have received the chips through means other than play, but to non-patrons. In this respect, the direct language clearly says that if you are a “patron,” then the casino must promptly redeem their chips from you.

Another factor playing on this is the legal status of how you hold the chips. While you may be cashing the chips for another advantage player, the law of contract and the common law generally, allow for the free assignment of contract rights. Likewise, evidence of indebtedness is freely assignable. As an assignee of the “patron,” you take on the status of the “patron.” This should include the “patron” status under principles of assignment. Another factor playing into this scenario is that persons in society are allowed to use agents to conduct their business. This includes agents for undisclosed principals. The agent stands in the shoes of the principal. If the principal is a “patron,” then redemption should occur on presentation by an authorized agent. Again, the burden is with the casino to show that they know or reasonably should know that the presenter is not a “patron.”

The Nevada Gaming Control Board has again shown its worthlessness and lack of integrity. Clearly the MGM Grand should be punished for its illegal bullying tactics. I hope that one of the victims eventually is willing to go forward with legal action, perhaps forming a class action lawsuit on behalf of all patrons who have been similarly victimized. The challenge will be to remove the matter from the jurisdiction of the Gaming Control Board, where we all know nothing will be done to punish the wrongdoers. In civil court, where the victim still has an uphill battle in Nevada, at least there is a reasonable chance of prevailing, and a jury awarding appropriate damages against MGM Grand for its continuing despicable conduct.

Topics: Casino Executives, Government Corruption, Las Vegas, MGM Grand / MGM Mirage, Nevada Gaming Control Board | 7 Comments »

7 Responses to “The Bear Growls: MGM Grand and Gaming Control Board conspire to harass patron trying to cashing chips”

  1. oldmanhoo Says:
    March 11th, 2007 at 3:11 pm

    Knowing the hassles for those trying to cash 5k chips at these joints, wouldn’t be wiser amd much less of a problem to simply refuse the 5k chip(s) when coloring up? Demanding 1k chips instead?

  2. LVBear Says:
    March 11th, 2007 at 9:33 pm

    Thanks for reading; your comments are appreciated.

    Yes, it would be easier to refuse the $5K chips and most knowledgeable people are now doing that. But in the case under discussion, Mr. Dalla received the chocolate chip from a friend who owed him $5K.

    Ina previous incident, MGM Grand refused to cash yellow chips until ordered to do so by Gaming, which sadly assessed no penalty against MGM Grand for its despicable behavior.

    In any event, if gaming would take some action against the unethical casino employees hassling patrons in this manner, the activity might be stopped. It is Gaming’s refusal to do anything about it that perpetuates it.

  3. russellj93 Says:
    March 14th, 2007 at 12:42 pm

    Last year I met a friend in Las Vegas. He flew in from Charlotte, NC and I flew in from Sacramento, CA. He was on a business trip at a conference held at the Bellagio (a MGM property). I was invited along to help him with his Blackjack play. He is a high roller. I am a low roller. We stayed at the Bellagio and were there for five days. On our last day there he said he had lost a little money and was going to get up early and try to recover some of his money before he had to go to the airport for the trip back to Charlotte. I left early that day and returned to Sac. Later, when we were both back home he called and said he won back $3500.00 of his money. He also said he had a problem redeeming his chips. He went to the cage to cash in and it took him 30 minutes to get paid. He said the cage made several phone calls He did get paid but went through a big hassel. He is a multi-millionaire and I can assure you he is very touchy about his money especially when he expects to be paid immediately. According to the Current Blackjack News for that month, the Bellagio is a mecca for high rollers. So what is the big deal about redeeming a lousy $3500 from a non-counting BJ player and hotel guest.?

  4. nycpro Says:
    April 29th, 2007 at 10:21 am

    Approximately two years ago I played in the baccarat pit of the MGM for several hours and tried to cash out just over $4000.00 in chips. My buy in was $1000.00.

    I went to the cage (actually a desk) located right in the pit and was forced to wait for about 35 minutes while they were looking into it.

    Looking into what? I played for several hours in full sight of the pit critters by myself and cashed out as soon as I finished playing. Did not even go to the restroom but stayed right at the table the entire time.

    This is one sick casino that just hates to pay a winner.

  5. rogue1 Says:
    May 3rd, 2007 at 4:22 pm

    makes your blood boil reading this!

  6. thefish2010 Says:
    May 27th, 2007 at 5:52 am

    I had a major problem cashing in $4,000 as well. I bought in with $500, and when I got up to $4K, it was a nice round number, so I quit. When I got to the cage, they asked where I was playing, and since it was within view of the cage, I pointed to the pit. They called, and told me to wait.

    About 2 minutes later, a woman came over and demanded to know who I was. When I refused, she said “You’re Mr. Fredrickson, right?” I said no (it was some other guy’s real name, apparently not a friend of the MGM). She demanded to see my ID, so I just flashed it to her enough so that she would know I wasn’t whoever they thought I was. 2 days later, about a month later I checked my W/L statement on the MGM players club site, and they had actually added the $4K!

    When I showed my ID, I made a point of covering my last name before I turned it to her. This means surveillance had to have actually reviewed the tape when I flashed it, zoomed in before I put my thumb over it, and ID’d me and added it to the win.

    All that over $4K. These guys are ridiculous.

  7. "Vegas Poker Incident" - Poker Forums Says:
    November 8th, 2007 at 7:57 pm

    […] on 2p2): Here is the Las Vegas Sun’s story. Here is Lou Krieger taking the casino’s side, here is a […]

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