(1)
Phase 1 Determination
Standards. The Commission shall not issue an affirmative
determination of suitability for any Category 1 or Category 2 applicants
unless:
(a) The applicant meets the standards
in M.G.L. c. 23K, §§ 12, 16, 46 and 47.
(b) The applicant complies with the
provisions of
205 CMR 111.00:
Phase 1 Application Requirements and
205 CMR 115.00.
(c) The Commission has determined that the
applicant has demonstrated financial stability pursuant to
205 CMR 117.00:
Phase I Determination of Financial Stability.
(d) All qualifiers under
205 CMR
116.02: Persons Required to be
Qualified have been determined to be suitable by the Commission or
received a waiver under
205 CMR 116.03:
Waivers.
(2)
Burden of Proof.
All applicants for a Phase 1 suitability determination must establish their
qualifications by clear and convincing evidence.
(3)
New Qualifiers.
Subsequent to the issuance of a positive determination of suitability in
accordance with
205 CMR
115.05(3) relative to a
gaming licensee or applicant for a gaming license, if a new person is
designated by the bureau as a person required to be qualified in accordance
with
205 CMR
116.02: Persons Required to be
Qualified, they shall submit a completed application to the bureau. An
entity qualifier shall submit to the bureau a Business Entity
Disclosure Form - Category 1 and Category 2 Entity Applicants and
Holding/Intermediary Companies in accordance with
205
CMR 111.02. An individual qualifier shall
submit to the bureau a Multi-jurisdictional Personal History Disclosure
Form in accordance with
205 CMR
111.03 and a Massachusetts
Supplemental Form in accordance with
205 CMR
111.04. A new qualifier designated in
accordance with
205 CMR
116.02: Persons Required to be
Qualified must establish their qualifications and meet the standards
in M.G.L. c. 23K, §§ 12 and 16 by clear and convincing evidence and
shall be subject to all applicable procedures contained in
205 CMR 115.00.
(4)
Continuing Duty.
Once issued a positive determination of suitability, the gaming licensee and
all qualifiers shall have a continuing duty to maintain suitability in
accordance with 205 CMR 115.01(1) and (2). The gaming licensee and each
qualifier shall have a continuing duty to notify and update the IEB, in
writing, within ten days of the occurrence, unless an alternative filing time
is authorized by the executive director, or where applicable, gaining knowledge
of the following:
(a) Any denial, suspension
or revocation by a government agency in any jurisdiction of a gaming related
license, registration, certification, permit or approval held by or applied for
by the gaming licensee or qualifier;
(b) Any discipline, including a fine or
warning, related to gaming operations imposed upon the gaming licensee or
qualifier by any government agency in any jurisdiction;
(c) Any fine related to gaming operations
assessed on any gaming entity owned or operated by the parent to the gaming
licensee by any government agency in any jurisdiction.
(d) Any arrest, indictment, charge or
criminal conviction of any qualifier in any jurisdiction;
(e) Any complaints, allegations, or notice of
investigation thereof made or known to be contemplated by a gaming regulator or
other governmental agency against the gaming licensee, qualifier, or any gaming
entity owned or operated by the parent to the gaming licensee, of which the
gaming licensee or qualifier is or should reasonably be aware, involving
conduct that if substantiated could reasonably lead to potential revocation or
suspension of the license or approval held by the gaming licensee, qualifier,
or gaming entity owned or operated by the parent to the gaming licensee, in
that jurisdiction and/or imposition of a fine of $50,000 or greater;
(f) Any reports, complaints, allegations, or
material legal proceedings made, commenced, or known to be contemplated by a
governmental agency against the gaming licensee or qualifier, of which the
gaming licensee or qualifier is or should reasonably be aware, involving
conduct that if substantiated could reasonably lead to potential criminal
charges including, but not limited to, allegations of theft or
embezzlement;
(g) Any information
known or that should reasonably be known to the gaming licensee or qualifier,
including by way of receipt of a subpoena, that the gaming licensee or
qualifier is or may be the subject of a criminal investigation by a law
enforcement or regulatory agency;
(h) Any exclusion or barring of a qualifier
from any casino, gaming establishment or gambling/gaming related entity in any
jurisdiction;
(i) The termination,
suspension from employment, or other discipline of any key gaming employee
licensed in accordance with
205 CMR 134.00:
Licensing and Registration of Employees, Vendors, Junket Enterprises
and Representatives, and Labor Organizations or qualifier;
(j) Any material pending legal proceedings
required to be reported in accordance with
17 CFR
229.103 - (Item 103) Legal proceedings. For
purposes of 205 CMR 115.01(4)(j) the registrant referred to in
17 CFR
229.103 - (Item 103) shall be both the gaming
licensee and the parent company of the gaming licensee as determined by the
IEB. Additionally, the gaming licensee and each qualifier shall provide notice
of any pending legal proceeding which includes any allegation of fraudulent
conduct by the gaming licensee or a qualifier, that may reasonably threaten the
economic viability of the gaming licensee or a qualifier, or that alleges a
pattern of improper conduct by the gaming licensee or a qualifier over a
sustained period of time;
(k) Any
significant financial event related to a gaming licensee or entity qualifier.
For purposes of 205 CMR 115.01(4)(k), a significant financial event means a
merger, acquisition, consolidation, debt restructuring, material change in debt
rating by major credit rating agencies (US/International), legal entity change,
material ownership change, the assessment of a fine or penalty of $250,000 or
greater by the SEC or international equivalent, restatement of previously
issued financial statement(s), late filing of financial statement(s) with the
SEC or international equivalent, US or international equivalent bankruptcy
petition, default of financial debt covenants and receivership, disposal of a
material business segment or asset, or adverse action(s) taken by the IRS;
(l) Issuance of an "Adverse" or
"Qualified" audit opinion, or the international equivalent, by an independent
accountant to the gaming licensee or qualifier;
(m) A change in accounting firm engaged to
perform attestation and/or assurance services for the gaming licensee or
qualifier; and
(n) Issuance of a
delisting notice from a United States or international stock exchange relative
to the gaming licensee or qualifier.
