Bookmaking scandal casts doubt on MGM Resorts’ prospects in New York City casino licence race
The chances of MGM Resorts International (NYSE: MGM) winning two of the three highly sought-after full-scale casino licences in New York City have become complicated due to an unfolding bookmaking scandal in Las Vegas.
The bookmaking scandal
MGM Grand and Resorts World, operators of the Empire City Casino in Yonkers and the Resorts World Casino at the Aqueduct Race Track in Queens, were considered frontrunners in the state-run licensing process, which is expected to conclude next spring.
The uncertainty surrounding these licences emerged after Scott Sibella, the former head of the MGM Grand casino in Las Vegas, was compelled to resign as president and operating chief of Resorts World
The report noted Resorts World said Sibella’s sudden exit from the company on Friday was “effective immediately” over “failing to disclose certain information required under company policies.”
This news arrives at an inopportune and challenging moment for MGM, as they are presently recuperating from a recent cyberattack spree aimed at casino giants.
A deep-rooted story
According to a recent report, federal agents are investigating whether employees at MGM Grand, where Scott Sibella was president in 2017 and 2018, had been syphoning off company assets to pay gambling debts to bookie Wayne Nix. Nix had pleaded guilty in 2022 for operating a massive, illegal gambling operation and filing false tax returns.
The report also noted that this scandal could be a bigger problem for MGM Resorts International (NYSE: MGM) than Resorts World, as the former was allegedly involved in the conduct. However, Resorts World would still need to get rid of the stain.
This news could be beneficial for MGM’s rivals in the casino race. Some of the strong contenders include Bally’s Corp (NYSE: BALY), Caesars Entertainment Inc (NASDAQ: CZR), Las Vegas Sands Corp (NYSE: LVS), and Wynn Resorts Limited (NASDAQ: WYNN).
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