American Gaming Association Publicly Opposes Unregulated Skill Gaming Machines

Posted on: April 20, 2021, 10:12h. 

Last updated on: July 7, 2021, 01:00h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The American Gaming Association (AGA) has come out in opposition of unregulated and unlicensed so-called “skill gaming” machines that are proliferating across the nation.

American Gaming Association skill gaming
Skill gaming machines are seen next to children’s toys in a Pennsylvania convenience store. The American Gaming Association says such gaming terminals must be eradicated from businesses that are not licensed to offer gambling devices. (Image: Twitter)

They look and operate closely to traditional slot machines found in licensed casinos. But the AGA says there are no consumer protections in place on skill gaming machines, nor do they provide tax revenue for the local community and state in which they operate.

The gaming industry’s preeminent lobbying group contends that the terminals are not subject to meaningful testing, licensing, or regulatory standards, and are often linked by opponents to criminal activity, including money laundering, drug trafficking, and violent crime. 

History has taught us that unregulated gambling gives rise to an array of legal and social concerns, and ultimately erodes public confidence in the safety and integrity of the whole gaming industry,” Mark Brnovich, Arizona’s attorney general and a former director of the Arizona Department of Gaming, said in an AGA release. 

In the AGA’s white paper titled, “Skilled at Deception: How Unregulated Gaming Machines Endanger Consumers and Dilute Investments in Local Economies,” the AGA calls on state lawmakers and enforcement agencies to root out illegal and unregulated gaming machines.

Skill Gaming Operations

Walk into a bar or restaurant in Pennsylvania, and the odds are good that you will find a skill gaming machine. The skill component typically involves requiring the player to identify a winning payline. That differs only slightly from a traditional slot machine, which automatically reveals whether the spin won or not. 

Recent raids of unlicensed gaming machines have occurred in Pennsylvania, as well as in California, New Jersey, Arkansas, North Carolina, Hawaii, and Tennessee. However, many of those raids involved unlicensed underground gaming dens offering unregulated slot machines and other gaming devices. 

Pace-O-Matic (POM) and Miele Manufacturing, a leading manufacturer and distributor of skill gaming machines, have long argued that their terminals are legal. In Pennsylvania, the companies’ basis is a 2019 ruling from the Commonwealth Court that concluded skill games are not regulated by the state’s Gaming Act.

“Because the plain language of the Gaming Act indicates that the General Assembly did not intend for the Gaming Act to regulate unlicensed slot machines, which fall outside the ambit of the licensed facilities clearly delineated by the Gaming Act … we conclude that the POM Game is not subject to the Gaming Act,” Judge Patricia McCullough wrote in the majority decision.

AGA Recommendations

The commercial gaming industry has come out in great opposition to unregulated gaming machines, including those that claim to have elements of skill. The AGA is urging states to take quick measures to make sure gambling is only occurring through licensed and regulated channels. 

Legal gaming provides immense benefits to the communities it serves — and operating with a gaming license is a privilege that our industry takes seriously,” said AGA Vice President of Government Relations and Gaming Policy Counsel Jessica Feil.

“Unfortunately, there’s been a rapid increase of unregulated gaming machines that exist in the shadows, taking advantage of loopholes and flouting the law, with little to no oversight. These machines ultimately endanger consumers and communities, fueling problem gambling and crime while drawing important tax revenue away from states,” Feil concluded.