Cantor Fitzgerald gambling arm to pay $2 million to settle regulator complaint
Regulators believe that Cantor Gaming, or chief executive Lee Amaitis, should have known that former executive Michael Colbert was placing illegal bets.
January 09, 2014 at 05:53 AM
2 minute read
The original version of this story was published on Law.com
Wall Street firm Cantor Fitzgerald LP's gambling arm, known until this week as Cantor Gaming, has agreed to pay $2 million to settle gambling regulators' allegations of illegal bets, according to sources close to The Wall Street Journal.
According to the complaint filed with the Nevada Gaming Control Board, regulators believe that Cantor Gaming, or chief executive Lee Amaitis, should have known that former executive Michael Colbert was placing illegal bets. While the complaint does not say that Amaitis placed illegal bets himself, regulators say that failure to supervise an employee and prevent criminal behavior properly is in violation of Nevada gaming code.
“It's going to be a severe punishment that will resolve the matter in the regulatory world,” said A.G. Burnett, chairman of the Nevada Gaming Control Board, to the WSJ. “The hope is that the company will be more compliant with the board in the future.”
The company denies any wrongdoing in the case, and it said that it expects to resolve all issues with Colbert's illegal gambling “reasonably soon.”
“The Company conducted its own extensive internal analysis of Mr. Colbert's actions and of the Company's systems, operations, and procedures, and has implemented additional industry-leading compliance processes,” the company, now called CG Entertainment, said in a statement.
Cantor Fitzgerald, who recently made news for settling a 9/11-related lawsuit after their offices were forced to be closed for one month following the attack, used Cantor Gaming to break into the Las Vegas sports betting market. According to company estimates, it controls 30 percent of Nevada's sports betting market.
Spearheading their growth, Cantor Gaming has introduced financial-market technology and analytics to set betting lines and make wagers. Lee Amaitis has spearheaded Cantor Gaming since its inception.
For more on the gambling side of law, check out these InsideCounsel articles:
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