Predatory Lending Practices Embedded in Casino Legislation

posted Nov 16, 2011, 8:17 PM by John Ribeiro

Dear Governor Patrick,

There comes a time in every leader’s tenure when he or she will come to a crossroads; a point at which they must make a fateful decision that will intractably impact those in their care.  You stand at such a nexus now.  The decision you make in the next few days will be felt by generations to come in Massachusetts, long after you have moved on.

Governor, I am willing to bet that you have not heard the information that I have provided here.  You will be stunned at what you are about to learn.  You have promised that we would “get it right” here, in Massachusetts, because we have the ability to look at the mistakes of those who have traveled this road before us.

History will either report that you did it right or that you failed the people miserably.  I disagree with you on many topics but I believe you to be an earnest and honest man of integrity and I hope that you apply those traits to this issue.

As you are considering the fine print of the casino legislation that has arrived at your desk, I wanted to provide you with some insight on the business practices of the casino industry.  I am confident that you are not aware of these practices, as they are the “dirty little secret” of the industry.

I work in the field of Business Intelligence.  I design databases that companies use to collect information about their customers and prospective customers.  The data collected are used to decide how to promote their products or services to their patrons.  In other industries, this is a relatively benign practice as it simply allows companies to match up customers with products and promotions.  The hope is that those targeted consumers will spend their money more frequently at their establishments as opposed to their competitors.

Financial institutions also take advantage of this information in order to decide what banking, lending and investing products to offer to their own customers and prospects.  This is why we receive unsolicited credit card offers in the mail.

As financial institutions, the casinos will have access to all of an individual's financial information.  They leverage this specialized status and "loyalty programs" to gain specific knowledge about how much cash and credit a patron has access to, when they use their credit cards in the casinos.  The industry calls this Total Cash Availability.  Additionally, they will also be able to find out how much equity a patron has in their home, car and other assets; this is called Global Cash Availability.  These can and will be taken as equity in exchange for credit.  Casinos will also extend what amount to payday loans at high interest rates.  These will be offered to patrons who are under the influence of alcohol, alcohol, that the casinos will be able to offer free of charge.

The casino industry uses all of this information along with real-time game-play data to make targeted offers to specific people.  They are also able to alter the payout rate and the “near-misses” seen by each person to increase their rate of play and the amount per play.

Governor Patrick, you have acknowledged that there will be more addicted gamblers created by the advent of casino gambling in Massachusetts.  I'm sure we would disagree on the total number but you should understand that this legislation allows the casinos to offer loans directly to those who have been drinking.  Our state is still trying to recover from the sub-prime mortgage lending scandal.  Does it really make sense to introduce an industry that will prey on people by offering them loans while they’re intoxicated? 

Casino industry experts will tell you that they only need to provide loans to “high rollers”.  This is disingenuous.   The legislation does not provide any income threshold or guidance.  All patrons are fair game.

Below are three links, which show how the casino industry collects and uses the financial and game-play data to identify patrons who can be tapped for more revenue.

1)  The video linked below shows that casinos have access to all of your financial information as well as transactions outside of the casinos as soon as you use your credit or atm card in one of their machines.

2)  This link is a promotional page which brags about this software’s ability to identify “the most profitable customers and those which can be ‘tapped’ for additional revenue and profit.”  This software identifies these gamblers while they are playing and helps identify them for promotions.  This software targets people to ply with free liquor.  It is not a random offering. 

3) The following is a link to a patent for a “METHOD AND SYSTEM FOR DYNAMICALLY AWARDING BONUS POINTS.”  It also describes in detail how machines can be dynamically reconfigured to generate more revenue while they are being played by increasing the rate of play and reducing payouts.

Let me be clear.  The methodology is as follows: 

1.    The casinos identify their patrons and prospects according to their potential value to the casino.

2.    The casinos monitor the play of those patrons and determine when to offer them free alcohol to maximize their spend on the games.

3.    The casinos then dynamically alter the speed at which the machines play and the rate at which they pay out to increase the profit they are making on a specific player.

4.    When the player has exhausted his or her resources on hand, the casinos extend them credit.

Dear Governor Patrick, this is only the tip of the iceberg.  This industry uses this data to manipulate payouts at slot machines to coincide with show times.  It also uses this data to identify patrons who may be slowing down their play and who may increase their play if they were provided with a free drink or two.

Governor, I know that you would not have supported this legislation if you were aware of these practices.  This is simply bad public policy.  If you sign this bill, you will have unleashed these predatory practices on the unsuspecting people of the Commonwealth.  The very people whom you have sworn to protect.

Kind Regards,

John Ribeiro

Winthrop, MA

Massachusetts Leaders Do Not Have The Facts

posted Nov 16, 2011, 7:59 PM by John Ribeiro

Massachusetts' elected officials have not conducted an unbiased study on the impact casinos will have on the state and host communities.

Call your legislators and ask them to support Senate Bill 150, which requires that an Independent Cost Benefit Analysis be conducted before considering any expanded gambling legislation.
We must keep the pressure on our legislators.
Call or email our legislators and tell them you want the facts!
Call or email the Speaker and ask him why he's only considered the benefits and not the costs.
Call or email the Senate President and ask her to consider the long-term negative impact this will have on our community. 
Call or email the Governor and ask him if he wants to be known as the man who brought casinos to the commonwealth? 
We need to impress upon our legislators that we need an
Independent Cost Benefit Analysis
before we allow any expansion of gambling in Massachusetts.
They claim to know the benefits but that’s been called into doubt… They claim they don’t know how to calculate the costs until they know the exact location…
If they don't know the costs, how can they determine how much to charge the casinos in taxes and licensing fees?


Earl Grinols laid out the formula in his book, “Gambling in America, Costs and Benefits”.  Grinols finds that for every $1 of revenue that is realized by the state, $3 is spent on fixing the problems casinos bring about.


And the National Gambling Impact Study Commission had one ultimate recommendation… Before you build a casino you must perform an Independent Cost Benefit Analysis.

Winthrop Town Council to Take Up Casino Issue

posted Sep 20, 2011, 9:11 AM by Neighbor of Suffolk Downs

September 20, 2011 Winthrop, MA - The Neighbors Of Suffolk Downs, a grassroots organization with members from the communities surrounding Suffolk Downs has successfully lobbied the Winthrop Town Council to take up the issue of casino gambling that is proposed for the racetrack in nearby, East Boston, MA and Revere, MA.  The Council responded to a request made by Neighbors of Suffolk Downs President, John Ribeiro, who has been a vocal opponent of the plan to site a casino at Suffolk Downs.


John Ribeiro, an East Boston native and Winthrop resident petitioned the Town Council to bring several questions to the table for consideration.  “The residents of Winthrop will have no say on whether a casino is built at Suffolk Downs”, said Ribeiro, “and we’re less than a mile from the gate.  Everyone knows that nearby communities and not just the host communities will be impacted”, he added.  The group is asking the Town Council to adopt a resolution in support of a bill that would require the state to conduct an independent cost benefit analysis on the plan to site a casino at Suffolk Downs and to provide for Winthrop residents to have an up or down vote on any casino planned within 10 miles of the town.  The resolution would then be sent to Speaker DeLeo (D - Winthrop) and Senator Anthony Petruccelli (D - Winthrop) urging them to withhold their support of any casino gambling measure unless and until the conditions of the resolution are met.


Representative Cheryl Dykema (D – 8th Middlesex) raised an amendment during last Wednesday’s debate on the measure to bring casino gambling to Massachusetts, that would have given “surrounding communities” an up or down referendum vote on the approval of a nearby casino proposal.  “One community found their public safety budget tripled one year after the siting of a gaming facility”, argued Dykema.  The measure was defeated by a roll call vote, 51-101.  Speaker DeLeo voted against the measure, denying his hometown a voice on this critical issue.


Lisa O’Connell Paulson, who sits on the board of Neighbors of Suffolk Downs and is a life long Winthrop resident added, “We’re already over burdened in this area; we have the airport and the pollution and traffic that brings, we also have the Deer Island waste water treatment plant and now they want to add a casino to the mix.  The people of Winthrop should have a say on whether a casino is built in our neighborhood.”


The Town Council will meet at 7:00 PM on Tuesday, September 20, 2011 at 7:00 PM in the Harvey Hearing Room at Town Hall, 1 Metcalf Square, Winthrop, MA.

John Ribeiro on NNN with Chris Lovett 6/24/2010

posted Jul 19, 2010, 8:09 AM by Neighbor of Suffolk Downs

YouTube Video

John Ribeiro founder of the nascent group Neighbors of Suffolk Downs appears on Neighborhood Network News with Chris Lovett on June 24, 2010.  John discusses the impact siting a casino at Suffolk Downs will have on the neighborhood and the local economy.

WBZ1030's Dan Rea to Host Debate Between Professor Goodman and Mayor Kimberly Driscoll of Salem

posted Jul 14, 2010, 7:53 PM by Neighbor of Suffolk Downs

We are pleased to announce that Dan Rea's Nightside on WBZ Radio (1030 AM) will be the venue for the second public forum on casinos organized by Neighbors of Suffolk Downs on Thursday night July 15th at 9:00 PM.  Expanded gambling authority, Professor Robert Goodman, author of "The Luck Business: The Devastating Consequences and Broken Promises of America's Gambling Explosion" will debate Salem Mayor Kimberly Driscoll, a staunch advocate of the pending casino legislation.

The rhetoric has been ratcheted up on both sides as a conference committee hammers out the differences between two versions of legislation that will legalize casinos in Massachusetts.  Join the Neighbors of Suffolk Downs in the discussion on this hot topic as the legislative session winds down.

Myths About Casino Legislation

posted Jul 6, 2010, 8:59 AM by Neighbor of Suffolk Downs

The Hubster's recent post, "Leaping without Looking", addresses some common misinformation that has accompanied the casino NON-debate over the past couple of months.
John Ribeiro

The Economic and Social Costs of Casinos

posted Jul 2, 2010, 5:55 AM by Neighbor of Suffolk Downs   [ updated Jul 2, 2010, 6:36 AM ]

By Tom Larkin
    Gambling can be a detriment to economic stability by siphoning money away from traditional consumer exchanges. 
    Over 70% of local businesses shut down in Atlantic City after casinos opened.  Economists Paul Samuelson and Warren Buffett describe gambling as a sterile transfer of money.
    Some studies report net job losses due to shifts in consumer dollars to gambling and cannibalization. Casino revenues decreased 8.4% nationwide by the end of 2009. While Massachusetts faces an FY2011 expected shortfall of 8.5%, compared to FY2010, casino states, Nevada (56.6%), Illinois (36.1%), New Jersey (37.4%), Connecticut (29.2%), Minnesota (26.4%) and Arizona (35.3%) face far greater shortfalls.

    Slot machines at race tracks, actually reduced revenue in some states. Proximity to gambling increases bankruptcy. Gambling is the 4th leading and fastest growing cause of bankruptcy. Baton Rouge opened casinos in 1994. By 1996, bankruptcy rose there by 53%. New bankruptcies in counties with casinos rose by 18% to 35%. Most money lost  comes out of credit and ATM cards, not from cash carried into the casino. Most customers of “resort” casinos live locally.    

    Gambling causes social instability by increasing crime, alcoholism, child abuse, suicide, youth gambling, divorce, domestic violence and  many other emotional and behavioral problems.

    Independent studies found an increase in crime rates from 8% to 10% in casino states, 30% attributable to casinos. About 21.4% of gamblers have been incarcerated compared to 7% for non-gamblers. About 30% of those incarcerated have gambling problems.

    Suicide attempts are higher among gamblers than other addictions.  Las Vegas has the highest suicide level in the country. Abnormally high suicides appeared in Atlantic City only after casinos opened. Suicide levels are 2 to 4 times higher in gambling counties.

    More money is spent on college campuses on gambling than on alcohol. Gambling is the fastest growing teen addiction with a rate of pathological gambling twice that of adults. In one study, 24% of male students in grade 10 and 11 visited gambling internet sites in a year.

    In Deadwood South Dakota, after 2 years of casino gambling, child abuse cases increased by 42% and domestic violence by 80%. In one study, 25% to 50% of spouses of pathological gamblers had been abused. The Indiana state gaming commission records revealed that 72 children were found abandoned on casino premises in a 14 month period.

    Problem gambling far exceeds the cost of illegal drugs.  About 30% of active gamblers have some level of gambling problem along a continuum from mild (at risk-18%), moderate (problem-10%) to severe (pathological-5%). 

    About 30% of people with drinking problems have gambling problems and about 60% of people with gambling problems have drinking problems. Gambling, drinking and mental health problems are not isolated, but connected. For example, 1 out of 5 returning veterans have a gambling problem, secondary to substance abuse, depression and PTSD.

    Some studies show costs outweigh benefits by $3 to $1. No independent C/B analysis of casinos has been done in Massachusetts.

    Evidence for these assertions can be found in The National Gambling Impact Study Commission Report (1999), Gambling in America-Costs and Benefits (Grinols- 2004) The US International Gambling Report (Kindt-2008) and Time, June 28, 2010.


 (Tom Larkin is a licensed psychologist and member of the Board of Directors of United to Stop Slots in Ma.  Tom participated as a panelist at the East Boston Forum on Casino Gambling held on June 30, 2010 at the Madonna Queen National Shrine)

                                                                                               June 30, 2010

Neighbors of Suffolk Downs in the Boston Herald

posted Jun 29, 2010, 7:46 AM by Neighbor of Suffolk Downs   [ updated Jun 29, 2010, 7:51 AM ]

“I’m confident we can defeat it,” said John Ribeiro, founder of Neighbors of Suffolk Downs, a coalition of groups opposed to a casino. “The voting block in East Boston are people who are concerned about quality of life issues and they don’t want a casino and the gridlock it would bring."

Suffolk Downs CEO, Chip Tuttle to attend forum

posted Jun 28, 2010, 12:48 PM by Neighbor of Suffolk Downs

Come and have your concerns heard by:
    Treasurer and Candidate for Governor, Tim Cahill
    Suffolk Downs CEO, Chip Tuttle
    State Senator, Anthony Petruccelli (D) East Boston, Revere and Winthrop
    State Representative, Carlo Basile (D) East Boston
This is the first and only forum to be held in East Boston (or any neighborhhod of Boston). 
Join the debate.
For it?  Against it? Come out and discuss it!

Treasurer Tim Cahill Candidate For Governor Will Attend

posted Jun 27, 2010, 8:28 PM by Neighbor of Suffolk Downs   [ updated Jun 28, 2010, 7:12 AM ]

June 27th, 2010
Neighbors of Suffolk Downs has just received confirmation that Treasurer Tim Cahill, candidate for Governor will be in attendance.

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