 Thank you. Good afternoon. Today is Friday, April 14, 2023, and this is an adjudicatory hearing before the Massachusetts Gaming Commission, relative to the alleged non-compliance of MGM Springfield with Massachusetts General Laws, Chapter 23N, Section 3, 205, CMR 247.01, Subsection 2A2 in the Massachusetts Sports Wadring Catalog. I will refer to MGM Springfield as MGM. My name is Kathy Judstine, and I'm the Chair of the Commission, and I'm joined today by my colleagues, Commissioners Eileen O'Brien, Brad Hill, Nikisha Skinner, and Jordan Maynard. The entire Commission will preside over the hearing and decision of this matter. This hearing will be conducted in accordance with 205, CMR 101.01, General Laws, Chapter 30A, Sections 10 and 11, and 801, CMR 1.02, the Informal Fair Hearing Rules. This hearing is being conducted via remote collaboration technology. Before we begin, I'd like to explain the process that would govern this proceeding. First, a notice of hearing was provided to MGM in advance of today's hearing. It identifies the alleged non-compliance incident that will be the focus of the Commission's attention at this hearing and the relevant statutes, regulations, and catalog. A pre-hearing conference was also conducted. Pursuant to Massachusetts General Laws, Chapter 23N, Sections 4 and 16, and 205, CMR 232, the Commission may hold this adjudicatory hearing and that the conclusion of the hearing may decide to issue a civil administrative penalty, impose conditions on MGM's license, suspend MGM's license, revoke MGM's license, reprimand MGM and or assess a fine on MGM. By the conclusion of my opening comments, this proceeding will commence with the presentation of the evidence in this matter. Specifically, the Commission will first call Zachary Mercer, IEB Enforcement Council, and any other witnesses listed on the Notice of Hearing or Witness List. MGM may ask questions of any witness who testifies. MGM will then be called upon to make a presentation and to call additional witnesses if any. Any Commissioner may question any witness who is testifying at any point during or after their presentation. MGM may raise any objection it desires at any time, however, the basis for all objections must be clearly stated. Finally, at the conclusion of all the evidence, MGM will be provided an opportunity to make a closing statement to summarize its view of the evidence. Before we begin, I understand that there are pre-marked exhibits that have been prepared in advance of this hearing. Those exhibits are identified on the exhibit list that has been circulated. They are as follows. Exhibit 1, Investigations and Enforcement Bureau Sports Wadring Non-Confinance Incident Review report dated every 22nd 2023. Exhibit 2, Notice of April 14, 2023 hearing. Are there any objections to exhibits 1 through 2 being marked and entered into evidence? No objections, Chair. Thank you. Those exhibits shall be admitted into evidence in order to maintain a clean record. I ask that those documents be referred to by exhibit number. At this point, I will ask if MGM would like to stipulate to exhibit 1 the IAB Sports Wadring Non-Confinance Incident Review Report. Thank you, Chair. Yes, MGM Springfield stipulates to exhibit 1 the IAB report. Could you say that one more time, please? Yes, yes, Chair. I said thank you, Chair. MGM Springfield does stipulate to the IAB report marked exhibit 1. Thank you so much. If MGM would like to have any additional documents entered into evidence during the course of the hearing, I would ask that they be properly introduced and marked. I will add that no final decision will be made at the conclusion of the public portion of the hearing. Instead, at the conclusion of the proceeding, the Commission will privately deliberate and ultimately issue a written decision. If at any point during the Commission's deliberations it determines that additional testimonial or documentary evidence is desirable, it reserves the right to ask MGM to provide such evidence prior to a final decision being made. We'll now swear in all the witnesses in. Anyone who will be testifying at this proceeding, please raise your right hand. Do you solemnly swear that the testimony you will provide before the Commission at this proceeding will be the truth, the whole truth, and nothing but the truth? Yes, I do. I'd like the Director to note that I'll have responded in the affirmative. Thank you. And before we begin, does MGM have any preliminary issues or objections? No objections or issues, Chair. Thank you. And so would MGM like to make an opening statement before we ask Mr. Mercer to proceed? No, Chair. We reserve the right to make a closing statement, but we'll waive the opening statement for the time being. Thank you, Chair. Thank you. With that, I ask Mr. Mercer to present Exhibit 1 of the Investigations and Enforcement Bureau of Sports, where you're doing non-compliance incident review report dated February 22nd, 2023. Thank you. Good afternoon, Chair and Commissioners. Zach Mercer on behalf of the IEB. On February 10th of this year, MGM's Compliance Director Daniel Miller notified Sports Wagering Director Band that MGM's mistakenly offered sports wagering on two unauthorized events. Specifically on February 2nd, wagering was offered on a regular season Harvard Men's Basketball Game versus Yale. And on February 3rd, wagering was offered on a regular season Harvard Men's Basketball Game versus Brown. The error was reported to MGM's through its Bender Bet MGM on February 10th. The IEB has learned the following key facts during its review. For the timeframe that wagering was allowed, for the February 3rd game, wagering was available from February 2nd at 7.56 p.m. to February 3rd at 5 p.m. for a total of 21 hours and 4 minutes. For the February 4th game, wagering was available from February 3rd at 9.58 p.m. to 6 p.m. on February 4th for a total of 20 hours and 2 minutes. Turning to the total stakes wagered for the February 3rd game, approximately $1,150.50. For the February 4th game, it was approximately $80. The total winnings were approximately $1,106.10. And as for the number of bets placed, there were 28 bets placed. Many were in the form of parlays and some straight bets. All were placed at kiosks. Director Miller, as for the reported reason of the error, Director Miller reported that the error occurred because when Harvard was originally added to their blacklist document under a previous jurisdiction's requirement of no collegiate sports, it was incorrectly designated as being located in Connecticut, not Massachusetts. When Massachusetts then came online to sports wagering and Massachusetts colleges were ineligible for regular season games, Harvard slipped through because of the previous incorrect designation. This has since been corrected and Harvard has properly been categorized as a Massachusetts college note. In addition, BetMGM has reviewed and verified that all Massachusetts collegiate sports are properly restricted. And in respect to remedial and mitigating information, in addition to BetMGM reviewing the entire list of collegiate teams and confirming that they are correctly labeled geographically, NGMS has started a daily audit of offered wagers to confirm no restrictions before opening the sports book or offering for the day. NGMS is also coordinating with Director Bann's team to ensure that its list of Massachusetts collegiate teams is accurate. Thank you. You're on mute. Mr. Ners, before we proceed, I'll ask MGM, would you like to ask Mr. Nerser any questions or give clarifiers? No, Chair. No questions for Mr. Nerser. Okay. Commissioners, questions. Madam Chair? Yes. So I just want to be very clear that the bets took place February 2nd through the 4th. MGC was not notified about this until February 10th. Am I accurate in what I'm hearing and what I'm seeing in the report? That is my understanding, Commissioner. Yes. So Madam Chair, I don't know when the proper time is to ask MGM the question why it took a week to tell us that this happened. Maybe you direct your questions now to Mr. Nerser to see if he has any insight on that and then MGM will make note of that. So with that said, in your investigation, was there any indication why it took so long for the MGC to be notified that this took place? I do not have any additional information in regard to that. I do believe that at the appropriate time, I believe MGM may have some additional information in regard to that. Thank you, Zach. And thank you, Madam Chair. It looks to me from reading the report and MGM can correct me if I'm reading it wrong, Zach. MGM knew about the error. They did not learn until February 10th. Am I reading the report correct? And then there's, I would like clarity on the time between when the vendor notified MGM on February 10th and when Daniel Miller reached out to Bruce. But my understanding of reading this is a gap between when the violation occurred and when MGM is alerted by their vendor. And I'd also like information on how it was the vendor became aware of it and how that seven day period actually happened between the violation and the vendor knowing and where the MGM can speak to how it was that they did not find it with their vendor. Yeah, so I can speak to that, commissioners. So the seven day period was based around the fact that with Harvard at the time, still being designated as a Connecticut school on that Blacklist document, it wasn't until we did it, we asked MGM to go and do a review of the Blacklist document that they found that it was there. And in so doing found that there had also been two games that wages were allowed as well, which is the second and the third. And that happened over a period of the ninth and the 10th, because obviously what one of them to do was one go through that entire Blacklist document and make sure that there weren't any other misrepresented schools. And also we wanted to make sure that there weren't any other active games that could have been done at that time that we would want to remove as well. And then as soon as we had all the information we felt that was necessary to give the IV as much information as possible, how it happened, when it happened, what we had done and how we had found it, then I made the notice to Director Van on the 10th. And Mr. Miller, do you know the approximate time between when you knew the violation had occurred, the alleged violation had occurred and when you reached out? I know that you were doing internal due diligence, but can you speak to the timeframe between you knowing and when you alerted him? I may have to look to Alex Wolder to assist me in that, but I believe it was around four o'clock in the afternoon on the 10th, and then we made the notice within a couple of hours of that. Hi, Commissioner Jet. Alex Wolder from Bet MGM, Senior Manager of Trading Compliance. Yes, we provided the final details to MGM Springfield at approximately 4.40 p.m. and the notification went out shortly thereafter, approximately 6.04 p.m. And a follow-up. Commissioner, can you speak to why, what prompted you to ask for the review of the list? Was there any concerns, risks or other things that caused you to go back and ask for a manual check on that list? Well, to be frank, at the time it was, we had heard the information of possible errors at Angkor and Plainridge, and so we felt in due diligence, we should go back and check the system too, hoping that we wouldn't find anything, but in doing so we did, and that obviously gave us calls to correct those issues as well. Before we proceed, thank you, Commissioner Browning. I just want to make sure that we asked all the questions of Mr. Mercer. Madam Chair. Yes. Mr. Mercer, have all of these bets been settled or canceled as of today? I don't have any additional information as to anything that's happened in the interim since the conclusion of the report. If there's anything that MGM could point to, I'm sure that they have the most up-to-date information in regards to that. Yes, Commissioner Maynard. All the necessary actions have been taken with the bets themselves, so most of them actually were parts of parlays that other legs lost on, and therefore it was entirely a losing bet. And so with that, what we have still attempted to do, though, because we were able to identify a couple of players, is reach out to them, refund their initial seed money. So one person that's been successful, too, they came and got their money back. The other money we are keeping to one side, and if it is not claimed within the one-year period, it will then be turned over to the sports waiter in front. Thank you. Other questions for Mr. Mercer before we turn to MGM for their statement and presentation? You're all set, Commissioner Skinner? Okay, and I am too. Mr. Mercer, thank you. Excellent, John. Okay. Thank you, Madam Chair. We'll turn now to MGM, and good afternoon. This gives you a chance if you do wish to make a statement and then proceed with any presentation. Thank you, Chair. You've already heard from my colleague and friend, Director of Compliance, Dan Miller. Also on the call from Ben MGM, you already heard from Alex Wilder, Senior Manager of Trading Compliance. Also on the call from Ben MGM is Jeremy Coleman, Deputy General Counsel, as well as Villalon, Chief Compliance Officer. We are here, of course, to respond and answer to any questions that the commissioners may have, and I will make a closing statement after we have done responding to questions. Thank you, Mr. Kim. Questions for Mr. Kim and those who are here from MGM? I know we've asked a few already, but Madam Chair. Yes, good afternoon, Mr. Miller and Attorney Kim. I have a question and it might require Mr. Coleman and Ms. Loney's response as well, but at one point, MGM suspended, I believe, the offerings for all NCAA basketball. Have you since restored that catalog? I'm assuming if so, you've developed a level of comfort in the trading offerings that are currently available. And if that's the case, can you just tell us a little bit about the steps you took to gain that comfort? I'll answer that, Commissioner Skinner. So yes, we did suspend them all. It was during really the period that we were trying to determine if any other active gains within Massachusetts College in order, so across to that 24-hour period, we did keep the suspension on over the following weekend, which are the two or three days that followed as well, just to make sure that we were 100% happy that all Massachusetts College teams were accurately removed from the system. But that was the reason that we did the suspension that we did, and then we reinstated NCAA basketball after that period. Right now, I can tell you the exact day that it was that we allowed it to go back into action, but we wanted our fellows at that MGM to do their thorough review of that Blacklist document, just in case there were anything else there that we were missing, which they did. And then once they reported back, we felt comfortable to turn that back on. Okay. And have you instituted any additional remedial measures as a response to this incident since the IEB report was issued and your last communication with Bruce? Nothing further since the report was issued, but in light of the incident, we started on site as our MGM sports book, retail sports book, do a daily audit of any teams that come across from the trading team at that MGM to the degree looking for Massachusetts colleges specifically. And if on occasion one has come across, we've made sure that it's only a team that is available in a tournament first, and then allowed that to go up on our boards. But otherwise, we wouldn't allow it, but that hasn't been the case. We've only seen them come forward when they are in fact in a tournament. Thank you. Can I do a follow up to that, Mr. Skinner? From my understanding that these bets were all made on the kiosk, correct? That's correct. Yes. And so for those that might be placed in person, have you given any particular training around this issue so that they can have other eyes for Massachusetts teams? Should there be something that slips through in the future? We didn't do strict training, but because of this incident, we went down as photo members of the sports book team and let them know that this one had happened to any of the vigilant of it from a person to person perspective. And that was in tandem with the daily audience that we began as well. Other questions, Mr. Miller? Any guests? I'm sorry. My fellow commissioners look at the exhibits and make sure that they've had a chance to ask all questions. Madam Chair. Yes, Commissioner Mayer. This is really a follow up to Commissioner O'Brien's question of Mr. Mercer, but I'm still trying to figure out the timeline. When was the vendor aware that there had been illegal wagers placed? Dan, would you like me to speak to that? Thank you, Alex. I was going to ask, yes. Sure. So on the morning of February 9th, we conferred with the MGM Springfield folks in light of what Dan had presented. And we undertook a full review of past offerings since launch. Well, the first thing we did was confirm that there were no active unapproved events because that would take a different course. There were no active unapproved events. So we moved on to review of all past offerings since the January 31st launch date. By the end of the day on February 9th, we internally, this went into the evening of the 9th reviewing all of the bets, we identified the two Harvard games. I promptly had the trading team confirm that Harvard was now properly blacklisted and that there were no other issues. The next morning, we flagged to MGM Springfield that we had identified a bit of an issue, but we were still investigating the full scope of it. We conferred on the exact details that would need to be confirmed to properly report to MGC. And that is where we came to that prior timeline that I gave, which is at 4.40pm, we were able to provide sufficient details to MGM Springfield for them to notify the MGC of the incident, which was done at runs to PM. Could I ask a clarifier? Because I might have lost track there just for a second, Tricia Maynard. So you made an initial contact to MGM and said we've identified an issue, but we're still processing. What date was that exactly? That was the morning of the 10th. Okay. Yes. The review of, you know, it was all wagers since the 31st, the launch. So once we confirmed that there was no active issue, we wanted to do a thorough review of all bets, which can be an extensive process. So it went into late evening on the 9th, our review internally. So we notified MGM Springfield in the morning that we had identified some issue. And then by the end of the day, we were able to provide sufficient details to them to report. Thank you. I have a follow-up. Mr. Walder, the undertaking of the review of the events catalog, can you just tell us a little bit about what that entailed? Yes, sure. So I basically asked the trading team to pull a report of every bet that we had taken since launch. And I had my team, and I personally did it as well, review that list for any in-state teams. And we identified the two Harvard games, the one from February 3rd and February 4th. And once we identified that game, that's when we started looking into the root cause. And of course, ensured that Harvard was properly blacklisted immediately after seeing those games. Madam Chair. Yes, Commissioner Hill. I don't know if this is an appropriate question, but I'm going to ask it. And if it's not appropriate, just tell me so. But I need to know or understand how Harvard was deemed to be a Connecticut school and not a Massachusetts school. I'm trying to understand that. And if you can explain that to me, I'd love to know. I think it only can be assigned as a manual error. This document was created a few years earlier in response to requirements and other jurisdictions where they have similar collegiate restrictions. And unfortunately, there were no factual patterns before early 2023 when this happened that would have revealed an issue with the Massachusetts team because we had never had to segment out Massachusetts teams before. So I wish I could give a better explanation other than somebody had made a mistake a few years earlier that, unfortunately, it took this incident to catch. We have done extensive work since that time to ensure that the document is accurate. We've done first immediately in response to this. We audited the basketball section because that's where this incident happened. And that was the ongoing sport at the time. And we found out Harvard was the only issue there, which was a good thing. Then we expanded to all other sports and verified that all teams were in there. This is thousands of lines on Excel. So it did take a bit of time, but we eventually reviewed every single team within every single sport. And my team personally did that. And we've since implemented a quarterly audit of the document to ensure continued accuracy. And anytime a new team or information is added to the document, my team will do a review of that to make sure it's accurate. So if the future team is added or changed, we'll have eyes on it. Thank you, Mr. Walder. Thank you, Madam Chair. Mr. Walder, you just answered my question about your audit. So thank you. That was first of all. Other questions, commissioners? Madam Chair. Yes, much made. So, Mr. Walder, you went live in Massachusetts with a two-year-old list. Is that accurate? It's, well, the information was initially implemented two years ago, but it's a list that we use constantly because it was relevant before Massachusetts for ongoing operations and other jurisdictions. Were parts of the list updated? You mentioned basketball being different than others. Were other parts updated or were you using just what existed? So the step that we do when we enter any new jurisdiction is my team. Well, if, so we reviewed the statute, of course, in determining that Massachusetts teams were not permitted unless they were playing in a collegiate tournament. So when we enter a jurisdiction such as Massachusetts where there's that kind of restriction, we will go into the document and review each team to see and mark it as not approved for that jurisdiction. It goes by each jurisdiction. We have guidance and that guidance gets passed on to the trading team who executes on the blacklisting. So we're constantly working in the document and using it and it's being updated in terms of the guidance. I don't know if, does that answer your question? That's perfect. I was just trying to get that fact straight. Thank you. Yeah. And just to the point about the different, each, the schools can vary from sport to sport, which is why we have to have different, different sections for each sport. Thank you. Other questions, commissioners? No other questions? So I'll turn to you, Mr. Kim. Do you wish to add any clarifier before you make a closing statement? Chair, just one clarification. I think Alex explained the blacklist, but just to make it clear that the blacklist is not a static document. It is an ever-evolving document. So when the blacklist was imported to Massachusetts, it wasn't like, you know, they took a two-year-old document and brought it over. It had been ongoing, you know, obviously changes all throughout, but unfortunately, because Harvard had been an issue in a different jurisdiction, that mistake was not caught as they were importing it to Massachusetts. And so unfortunately passed off as a Connecticut school and we had those unfortunate bets. But just to respond to commissioners' question, I just want to make it clear that the blacklist is not a static document. It is always evolving. A closing statement, Mr. Kim. Thank you, Chair. On behalf of the NGC Springfield and Bed and Gym, I extend my gratitude to the commissioners and the NGC staff for the timely period of time and consideration. We truly appreciate the cooperation, the collaboration, and the professionalism by the staff during this entire process. Director Band, Sterl, the entire enforcement and counsel team. Everybody has been, extremely cooperative. I can't reinforce enough, Chair, how much we appreciate and enjoy working with the NGC staff. Even through issues like this, where it's not always a pleasant topic to discuss, I found the NGC staff to be nothing but cooperative and professional, and I really, really appreciate that as a licensee. That goes a long ways to making sure that we don't shy away from reporting ourselves to the staff, because we know they will be handled with care and consideration. So thank you very much to Director Band and the entire sports imaging staff for your own professionalism. And as you have heard this afternoon commissioners, Bed and Gym reviewed this blacklist to ensure that all Massachusetts colleges are not properly included on the blacklist. Bed and Gym, as Alex has also mentioned, periodically on a quarterly basis checks the blacklist to make sure that the list is up to date and accurate as it respects to the Massachusetts College of Schools. As the commissioners have also heard, Andrew Springfield performs by itself a daily audit of the Bed and Gym. So when Bed and Gym provides us with the Bed and Gym for the day, our supervisor above from the sports imaging desk will review the schools, the college teams to make sure that no Massachusetts school is listed on there. And as Dan has already testified earlier, we had in the past college schools that are Massachusetts schools, but in every instance, those were authorized best because they were part of the tournament that four teams are more. So again, I wish to reiterate both and Gym Springfield and Bed and Gym thanks and gratitude for the commissioners and us and the staff. And we take both of us take our obligations to comply with the sports imaging laws and regulations very seriously. We are we regret that we appeared after a period for the commissioners on this matter today, and we will do our utmost not have to do this again in the future. Thank you very much chair commissioners. Thank you, Mr. Kim, Mr. Miller, Mr. Mulder, Mr. Coleman, and Ms. Amoni for appearing today. And unless I want to, of course, reserve, right? Commissioners, is there anything else that you'd like to ask at this time before we adjourn this meeting? Okay, so with that commissioners, I believe we have our second hearing scheduled for three o'clock. We can go into our deliberations on this matter now by going into that link. Does that seem to make sense or do we need to break commissioners? I'll go directly into deliberations. I'll set. Thank you all. Have a nice weekend. Enjoy this beautiful weather. Thank you. Thank you chair commissioners. Take care. Thank you chair. Thank you commissioners.