Young Man’s View: It’s Fishy That Only A Few Can Play In Gaming Bill

Tuesday 09th, September 2014 / 09:07 Published by

adrian-gibsonUp to the point of writing this column, neither the new Gaming Bill and accompanying regulations, the Financial Transactions Reporting Bill and Regulations, Gaming House Operator Regulations, nor the Proceeds of Crime Bill were uploaded to the government’s website, thereby leaving many Bahamians—who would wish to read the Bill themselves— in the dark and unable to do so and debating merely on the communique delivered in Parliament by Minister of Tourism (and Gaming) Obie Wilchcombe. Having seen the Bill—one would have to get a copy from an MP—we should run to bring out the Febreeze and all air fresheners because something—nay, lots of things—smell fishy about this/these newly proposed Bill/s.

On the face of it, the gaming bill appears to be nothing more than a manifestation of the pea brained, archaic thinking of visionless pretenders seeking to appease special interest whilst fostering economic apartheid and commercial sectarianism.

Here, we have a custom made bill that was not drafted for the benefit of the Bahamian public, but instead for the benefit of a person or persons comprising a special interest bloc. Is this a form of political payback for financial contributions to the governing party’s general election campaign? From the looks of things, it appears that the many millions made by web shop operators will be automatically sanitised in a state-sanctioned washing machine.

I spoke to a good friend yesterday and he said about the bill: “I don’t use this word often, but I call this bill an ‘abomination!’”

Don’t get me wrong, I support the regularisation of gaming and believe that it could augment our tax structure, legitimize another industry that employs hundreds of Bahamians and boost our economic engines if properly monitored, audited and if tax evasion and corrupt practices don’t derail its potential benefits. However, I do not support the half-baked, discriminatory approach the government is taking to do so. One can easily argue that it appears that they first sought to override the ‘no vote’ in favour of special interests and then they turned around and drafted a Bill that seeks to treat Bahamians as second and third class citizens in our own country.

How many times will they slap and spit in our faces and tell us that it’s heavenly showers falling and beating against our skin?

According to the Gaming House Operator Regulations 2014, the holder of a gaming house licence will be taxed according to whichever is greater – either 11 per cent of taxable revenue or 25 per cent of earnings before interest, taxes, depreciation and amortisation are deducted.

Failure to comply with taxes, the regulations said, would be subject to harsh penalties.

The licence holder would be required to pay 10 per cent of the tax owed for each week the tax remains unpaid. This would come into effect only if the penalty does not exceed twice the tax amount or if it is determined that the failure to pay was not with a view to evade the law.

I see the rates of taxation but has the government conducted an independent, forensic audit of these local gambling houses as yet or is the government basing its numbers on the information proffered by number house operators?

According to the bill, if a web shop operator is granted a licence, the initial licence and application fees would be: (a) An operator would be subject to pay $5,000 for a house operator licence for a new license; (b) $2,000 in gaming house premises licence fees; (c) $1,000 for the gaming house agent licence; (d) $250 for a key employee licence; and (e) $150 per gaming employee. Web shop operators will also have to pay an annual licence fee of $250,000 in subsequent years, whilst the premises and agent licences will remain unchanged. What’s more, key employee licensing and gaming employee licensing will also thereafter see a reduction to $120 and $80, respectively.

There are many hoops through which the government seemingly jumped, becoming Olympic qualifying acrobats to touch and please every constituency concerned—that is, the numbers consortium and the hotel casino operators—striving to piss off neither one whilst seeing the masses as merely an afterthought.

In 2014, we should not be seeking to make law that discriminates against any Bahamian. It does not matter what lame defences are offered or whatever silver tongue oration is offered, it simply cannot be prettied up!

According to the bill, the door will open for the government to establish a national lottery at the discretion of the minister, while outlining yearly rates of taxation on web shops among other stringent industry regulations. The bill also specifies that the minister responsible for gaming has the final say on several key decisions. These entail extending invitations or refusing them for application, notices of liability for payment of fees and deciding on the tax period.

I have a problem with the fact that the minister—whether FNM, PLP, DNA or in between—has so much power under such a proposed law, which could lend to a breeding ground for corruption and kickbacks and would subject Bahamians and/or an entire system to the whimsical inclinations of a minister who might be overly partisan and parochial in thinking and/or a person who can abuse such powers. I think that such power should not rest solely in the hands of a particular minister and that instead a bipartisan committee or regulatory body should have oversight or counterbalance a minister.

Whilst I’m at it, considering the newly proposed gaming regime, one would contend that there should be a minister with oversight of gaming, lotteries and all associated areas as opposed to coupling that area with tourism as has been traditionally done. I think that if a minister is minister of tourism and also gaming, it could likely cloud their judgment particularly as it relates to balancing the special interests of hoteliers and operators in the tourism industry against those persons who may strictly be operators of games of chance, etc.

While the government has several times stated that it will only grant a limited number of licences for web shop operations, the regulations outline a more stringent application process that can only be entered into if a prospective applicant receives an invitation from the Gaming Board of the Bahamas and will take the form of a comprehensive Request for Proposal (RFP) document. Here again I have a problem because such provisions defeat any notion of free enterprise, where—in a truly capitalistic society—persons can competitively engage in businesses for profit with little to no interference from the government except as it relates to regulations in the public or economic interest. These provisions again seem to cultivate an atmosphere of political malfeasance, nepotism and cronyism. Frankly, this entire bill deserves a closer look for payola because I can almost bet my bottom dollar that some sweeteners were or will be added to the deal to ensure “everything is straight.”

Why not simply set out qualifiers and allow those Bahamians who can qualify to submit applications and be granted licenses. As in any business, if one does not know what they are doing, cannot compete or goes bankrupt, their business will fold. What makes this so much different?

Why not set out qualifiers stating that one must be able to present a performance bond, that they must be fit and proper persons (by whatever standard is deemed necessary), that they must meet the current standard of KYC (know your customer) that exists within the jurisdiction, etc? A qualifier cannot and should not be that one should have experience because, technically, no one should have experience since the web shops were operating illegally.

I hate moratoriums on private enterprises. The government should regulate and stay out of the rest. Moratoriums limit our economy and kill the entrepreneurial spirit. Let’s be real, if a moratorium on the number of licensees or invitees by the government is allowed to subsist, then we could pretty much speculate on who the likely licensees will be. That is wrong….what about the rest of us, the Bahamian people? What’s more, who at the Gaming Board determines who will receive an invitation, who determines who will receive a formal Request for Proposal (RFP) document and on what basis? How should Bahamians feel about such a thing?

There are also operational guidelines that require the web shop owner to submit to the government a document that should clearly outline a description of the controls, administration and accounting procedures which will be followed once the gaming house is fully functional. But, who will follow-up to ensure that what is being submitted is true and correct? What are the control mechanisms in place?

Undoubtedly, the Public Accounts Committee (PAC) of the House of Assembly must be more active and on high alert, this committee must do a better job than it has done so far. One would argue that reports should be submitted to the PAC every quarter, reflecting the monies made by web shops, the taxes levied or any pertinent other information. Any word yet on how many MPs have disclosed to the Public Disclosure Commission and since none has been fined or jailed—per the Act—perhaps that Act should be repealed or the members of the Commission should all demit office. It’s disgraceful!

And, what the heck is a gradual step? Minister of Tourism Obie Wilchcombe told the press that the gaming bill is the first of a “gradual step” to removing all discriminatory clauses that prohibit Bahamians from gambling in casinos. However, what is that and why can’t it be done now. Look, the government is projecting themselves as untrustworthy hypocrites in asking Bahamians to vote in favour of four constitutional amendment bills that purportedly seek to end gender discrimination whilst at the same time perpetrating further discrimination by proposing a brand new bill that is blatantly inequitable and does not allow Bahamians to have an equal right to own and gamble in casinos as foreign investors and tourists. We “mussy” look fool aye!

All sectors of gaming should be open for Bahamian ownership and participation.

Why should I have to go to Puerto Rico or Las Vegas or Florida to gamble if I so choose to spend my disposable income on a game of chance? How is it that the governments of places such as Monaco and the United States see nothing wrong with their citizens spending their earnings as they please but our government treats Bahamians like little children? How is it that the Turks and Caicos—still a British colony—has modernised its gaming laws and outpaced an independent Bahamas, allowing their citizens—since 2007—to gamble in casinos, that is, those who earn more than $50,000? We need to get real, to realise that we’re 41 years old and to simply grow up, but I guess that’s also going to take a change in some of the political leaders we send to Parliament from our respective constituencies.

I have a few more questions: (a) What happens to the monies already earned by the number house operators if-and-when the gaming legislation passes? (b) Have banks softened their position as it relates to accepting this cash and what would be the impact on the economy, particularly from the perspective of the Financial Action Task Force as it relates to money laundering?

I note that the bill says NOTHING about the fact that web shop owners have gotten into banking, namely money transfers and other associated activities, such as loans, mortgages and so on. Will they be allowed to continue to do so? Will they also be granted bank licenses? Does the Central Bank have an updated and revised position on this that the public has yet to be made aware of?

Clearly, the gaming bill is intended for specific people as there are provisions that allow for criminals and those convicted of offences to hold licenses. One only has to give it some thought and we can quickly, by looking at the lay of the land as it’s currently set out, make a determination as to those persons who these clauses may be seeking to ensure attains a licence. Look, I have the greatest respect for at least one of those gentlemen and I truly believe that he is the reason why the bill has been advanced and has even been considered since he has greatly contributed towards the modernisation of local gaming houses and he is not as arrogant, flamboyant and downright tarnished. He is someone whose business acumen I admire and I think he, more than anyone else, should be granted a license.

Before I forget, when exactly is the government thinking of setting up a national lottery or is that merely another one of those “at the discretion” of the minister’s promises meant to pacify the public as they “fix up” certain folk?

That said, pluses about the bill are that it sets out requirements for web shop patrons and seeks to incorporate protective measures. The bill proposes that all customers must be registered under the name on their official government issued forms of identification along with a listing of their place of residence and age. Fictitious names will not be allowed. Moreover, the bill also asserts that operators within the gaming industry will be responsible for rehabilitation programmes for those who may become addicted to gambling.

The gaming bill should not pass until and unless those discrimination provisions are removed, until there are more checks and balances and a minister doesn’t have carte blanche and until the playing field is levelled. There should be NO moratorium and the government’s role should only be to regulate.

Anyone who believes themselves to be new age leaders, but seeks to perpetuate further discrimination on the Bahamian people in the 21st century—after this was already done for more than 50 years—needs to be relegated to the political dustbin and written off. Frankly, no visionary, forward thinking leader—within the Cabinet, the Parliament or elsewhere—should support this blatant, unjustifiable discriminatory practice. It is unacceptable and speaks to the mentality of those who lead or seek to lead us, masquerading as new generation leaders but merely using a silver tongue to mask the regressive, impractical and “foreign-first-Bahamians-later” thoughts that cloud the dark recesses of their politically demented minds. As the debate proceeds, we will soon discover how many so-called leaders and wannabe leaders will support the prolongation of this absurd inequity and economic Jim Crowism against the Bahamian people.

Adrian Gibson

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