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Secrecy still surrounds casino plans

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Map of the St Regis resort in St George's, showing the hotel (1), planned casino (2) and the residences for sale (4 and 5)

Gaming regulators have kept their discussions about Bermuda’s failure to launch a casino industry largely a secret after releasing heavily redacted minutes of their meetings.

The Bermuda Gaming Commission disclosed minutes from ten meetings its board members held between March 2022 and February this year but the records shed little light on why the sector has yet to take flight.

One meeting took place on January 26 — less than two weeks after it was revealed that a US gaming company developing a casino at the Hamilton Princess & Beach Club had pulled out because of the length of time the project was taking.

Century Casinos, which had been involved in the development for eight years, said with the existing legislative framework it could not foresee the project being completed in a reasonable time, if at all.

The hotel said it would not look for a new casino operator until the publicly funded BGC, which has been in existence since 2015, could give a “viable path forward”.

At the BGC meeting ten days later, led by chairwoman Cheryl-Ann Mapp, the issue came up but only four paragraphs about it can be read in the minutes, which were shared with The Royal Gazette in response to a public access to information request.

The text was censored to remove details of the discussion. Even the name of the hotel and the US company, already in the public domain, were removed.

The minutes record: “A meeting was held with [redacted] recently who informed the commission that [redacted] announced their withdrawal of services with [redacted].

“[Redacted] informed the commission that they will not be looking for a [redacted] until 2024-2025.”

Several lines of text were then removed, before the minutes note that: “The commission have a meeting scheduled with [redacted] for January 27, 2023 to discuss policy matters. [redacted sentence]. An update to the board will be given following this meeting.

“Following the media reports regarding the lack of a casino opening, the board recommended the commission consider sourcing a public relations officer to be on standby for issuance of a press release.”

The only other reference to casino gaming in the minutes was a note to say commissioner Renée Webb “raised the question for cashless gaming not being pursued for Bermuda”. The record states that “in-depth discussions took place” but does not give details.

The Royal Gazette published a special report in 2017 about a controversial plan for a cashless gaming network management system for casinos. The company that signed a memorandum of understanding with the Government later said it no longer had any interest in being involved.

More recently, David Burt, the Premier and Minister of Finance, who is responsible for the gaming sector, said it was up to operators, banks and regulators to assess if casinos would adopt a cashless model.

After the BGC’s January meeting, the commissioners met on February 23. The minutes for that session refer to the January 27 policy meeting and Ms Mapp giving commissioners an update on how it went.

Again, the text of the minutes was censored before being shared to remove salient details, apparently about the collapse of the Hamilton Princess project, which had been expected to generate 100 jobs.

The minutes refer to e-mail correspondence sent to the BGC and shared with the Cabinet Secretary.

“The chief executive [Charmaine Smith] advised that she had been in communication with the Cabinet Secretary regarding this matter and that he had sought an understanding of the commission’s options. The board were appraised that the chief executive assured the Cabinet Secretary that the commission executive were prepared and [redacted].”

The minutes refer to a “fulsome discussion regarding the circumstances leading up to [redacted]”. Details of the “fulsome discussion” were not shared.

The February 23 minutes also refer to a “matter currently before the board for decision” and “regulatory action to be considered by the commission”, but details were omitted.

One of the Government’s key economic pledges, yet to be fulfilled, is to create a casino industry on the island.

Earlier BGC minutes, from March last year, refer to “three applicants for a casino licence”.

The St Regis Bermuda Resort

Since that time, the St Regis resort in St George’s has been awarded a casino licence but the hotel has declined to comment on whether the project will go ahead.

The resort is owned by Hotelco International, which uses the St Regis name under a licence from Marriott International.

Minutes from a June 2022 meeting of the BGC record that: “[Redacted] are nearing completion of its mapping exercise of the internal controls from Marriott which is to ensure that all legislative and regulatory requirements [including the Proceeds of Crime Act] are met. Once the gaps are identified [redacted] will then focus on the qualitative review of the controls.”

Although a casino is yet to open at St Regis, the website for the luxury residences available to buy at the resort refers to: “The very first casino for the St Regis brand and in Bermuda, making it a great attraction for our guests.”

It provides a map for potential buyers, with the casino marked as being next to the hotel.

Hotelco Bermuda general manager Laura Purroy declined to comment last week.

Mr Burt did not respond specifically to questions but said: “The Government continues to engage with stakeholders, including the Bermuda Gaming Commission, local banks, and others, to overcome the challenges that have thus far hindered our goal of launching a casino gaming industry in Bermuda.

“Diversifying our economy is a key priority for the Government and therefore [it] will continue to work diligently and assess all available options to ensure our goal is met.”

Ms Smith did not respond to questions.

The Gazette has asked the Information Commissioner to review the BGC’s redaction of the meeting minutes.

Other topics covered during the meetings include the demise of Bermuda’s betting shops, the regulation of crown and anchor, job recruitment at the commission and its financials.

Extracts on casinos from BGC meeting minutes

March 2022: Chief executive Jean Major gives an “update on the status of the three applicants for a casino licence” in a written report to the board.

April 2022: Commissioners discuss the process leading to the opening of a casino and agree the “time frame between the decision of the [casino] operator being eligible and the opening of the casino should not be protracted [ideally within three months]”.

May 2022: The board discusses a “proposed casino licence application” with the applicant’s name removed. The minutes record: “Meetings were held with [redacted] representing [redacted] regarding application of a casino licence and advised no time frame has been set by the proposed investors of the property.”

August 2022: The minutes note an unnamed operator has given a “pre-opening plan … to the commission [which] is currently under review by the technical team”.

They also state: “Discussions are continuing with representatives of [redacted]. Due diligence is being conducted with the commission.”

At the same meeting, the Government’s economic recovery plan is discussed and it is noted that the commission met the previous month with KPMG representatives “who are tasked with reporting on two government initiatives: online gaming and initiatives to facilitate casino gaming in Bermuda”. The minutes say the BGC will report its progress to the government representative for the economic recovery plan. “Should government decide to amend legislation, the commission will aid in the policy development and drafting processes.”

October 2022: The minutes state the commission has been informed by an unnamed operator that “they are currently compiling the required disclosure documentation for submission to the commission. Consultant [redacted] is on standby to receive the documentation for the due diligence process.”

November 2022: “No new developments on the progress for the casino opening in spring 2023. A meeting was held [ten lines of text redacted].

“The operators have begun the process of submitting their suitability documentation, which is currently under review by the regulations team.

“[Four lines of text redacted].”

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Published August 11, 2023 at 12:27 pm (Updated August 11, 2023 at 12:27 pm)

Secrecy still surrounds casino plans

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