When David Burt delivered the opening remarks this year at a public forum ostensibly on “safe and responsible gambling”, he described the panel of assembled speakers as “very esteemed”.

Seated at the table at the Elbow Beach Bermuda Resort & Spa, at a Progressive Labour Party event that he said MP Zane DeSilva had “assisted greatly” in organising, were an Australian barrister called Tibor Vertes, local online sports entrepreneur Damien Furbert and two executives from a Florida-based company called Banyan Gaming.

They were billed on a PLP flyer advertising the May 3 forum as “international gaming experts”, and the evening’s host, PLP senator Kim Wilkerson, introduced the Banyan representatives, Jason Seelig and Jamie Lee, as experts in their field.

It was true that both men from Banyan had extensive experience in the gambling industry but what wasn’t shared was that Mr Seelig had previously run another company that was wound down because of its financial situation and surrendered its licence in two major gaming jurisdictions in the United States.

Nor was the audience told that Banyan was well connected on the island — so much so that it had already partnered with a local firm and signed an agreement with the One Bermuda Alliance government with a view to providing exclusively a networked gaming service to any casinos that may open here.

Banyan and its local partner company stood to make tens of millions of dollars every year from the deal.

That agreement was later terminated by tourism minister Michael Fahy, on the recommendation of Richard Schuetz, the executive director of the Bermuda Casino Gaming Commission, the regulatory body set up as the watchdog of the fledgeling casino industry.

But Banyan was clearly still keen to promote its cashless gaming product, with the PLP forum providing the perfect opportunity.

Mr Burt, then Opposition leader, explained in his introduction why the forum was being held. He said although the gaming commission was responsible for the regulation of gaming, “it is the responsibility of the political sphere to ensure that we put in place the correct structure of gaming, and it is our responsibility to give that type of direction into ensuring that, whatever gaming that we do, works here in Bermuda.”

Both he and Ms Wilkerson flagged up the potential problems that having casinos on the island could bring, such as money laundering, prostitution and gambing addiction. Referring to the latter, Mr Burt, who is now the Premier, mused: “Can we put in place a system that will catch problem gamers before they actually become more of an issue and it negatively impacts their family and society?”

For the next hour and a half, the overseas “experts” on the panel answered the question with a resounding yes. They also claimed such a system would lessen the risk of money laundering.

Bermuda could and should put in place such a system, they insisted. Mr Seelig said the Government should go as far as to make it mandatory for casinos to use a single, centralised, server-based networking system, with no cash on the casino floors.

“You have the opportunity right now to say this is the way the system is going to be,” he said. Mr Vertes agreed “100 per cent”.

It so happened that Banyan had just such a system to sell.

Few people at the forum or watching the online live stream would have known that Banyan, in partnership with local company MM&I Holdings, had already pitched this product to Bermuda’s Cabinet, as far back as 2013, and later to the gaming commission.

But two people in the audience, at least, did know: MPs Shawn Crockwell and Mark Pettingill. Back in 2010, the pair were pushing for casino gambling to be legalised in Bermuda.

Once in Cabinet, they continued to champion a change in the law.

According to records released under the Public Access to Information Act, they also introduced MM&I to their fellow ministers, before a promised referendum to give the electorate its say on casino gaming.

On November 22, 2013, Mr Crockwell, the tourism minister, presented a confidential Cabinet memo, seen by The Royal Gazette, which strongly made the case for the Government to come to an agreement with MM&I “so that if the referendum is successful we can proceed expeditiously with a competent networking system”.

The agreement that was subsequently entered into — a non-exclusive memorandum of understanding — was signed by Mr Crockwell, with Cabinet’s approval, and witnessed by Mr Pettingill, the Attorney-General, on December 3, 2013.

According to a document produced by MM&I and released by the gaming commission under Pati, Mr Pettingill asked for the memo to be drawn up in the first place.

The agreement, while not a contract, laid the foundations for MM&I and its American partner firm, Banyan, to potentially land a hugely lucrative government contract.

The ten-year deal, with the option for another ten years, would have allowed MM&I to reap 40 per cent of gross gaming revenue from all electronic gaming devices on the island, as well as an 8 per cent transaction fee on money exchanged for chips on dealer-operated tables.

The rewards were likely to be substantial if projections contained in a 2010 green paper on gaming were anything to go by. The government-commissioned report estimated that casino gaming could generate potential gaming revenues of between $84 million and $146 million annually.

Mr Schuetz wrote in an e-mail dated August 2 this year — and released under Pati — that “certain people on this island” believed they could make as much as $40 million a year from the deal.

In January 2014, Mr Crockwell and Mr Pettingill went on a fact-finding mission to see Singapore’s casino industry, at a cost to the public purse of almost $50,000. At the end of that year, Mr Crockwell tabled legislation that paved the way for Bermuda to have casinos of its own.

After both politicians quit Cabinet, they continued to take a keen interest in the topic: in Parliament, where they were vocal critics of the gaming commission and Mr Schuetz, and as lawyers representing clients in the gaming world.

According to correspondence obtained under Pati, those clients included MM&I Holdings, the local partner firm of Banyan.

Mr Pettingill quit Cabinet in May 2014 and opened a private law firm the next year, Pettingill & Co — later named Chancery Legal.

A letter from the Ministry of Tourism Development to the law firm, dated July 18, 2016, described MM&I Holdings as “your clients” and gave notice of Mr Fahy’s decision to terminate the memorandum.

Mr Pettingill, in his capacity as a private practice lawyer, had previously been at meetings when MM&I pitched its product to Mr Fahy and, separately, to Mr Schuetz.

Mr Vertes is another client of Chancery Legal; senior counsel Dennis Dwyer is representing him in a defamation action brought against him by Mr Schuetz.

During the May 3 forum, Mr Vertes backed up Mr Seelig’s suggestion that Bermuda should mandate a cashless system.

By the time the PLP’s Elbow Beach event was held, Mr Pettingill and Mr Crockwell had left the OBA and were free political agents, sitting as independents in Parliament.

Almost a year had passed since Mr Fahy terminated MM&I’s agreement with the Government and even longer since gaming commission chairman Alan Dunch, had told the company, in no uncertain terms, that the commission had “no intention of including anything” in its regulatory package that would oblige casinos to use the product of a “specified third party vendor”.

Correspondence disclosed under Pati includes e-mails between Mr Dunch and MM&I’s chief operating officer, John Tartaglia, in June 2016.

Mr Tartaglia wrote to Mr Dunch referencing the December 2013 agreement, as well as a detailed submission that his company and Banyan made in response to a May 2015 government advert seeking companies qualified to provide a “gaming network management system”.

Mr Tartaglia said the agreement and “successful” response to the advert “fully qualified MM&I as the service provider for Bermuda, which we expect to have reflected in the legislation/regulations”.

Mr Dunch forwarded the message to Mr Schuetz, below, and deputy commission chairman Garry Madeiros with the comment: “Looks like we are being set up for something.”

In replying to Mr Tartaglia, the commission chairman scotched the idea that MM&I should have any expectation of landing a government contract.

He wrote that he took on the chairmanship of the regulatory body “premised on the fact that I had sought and obtained an assurance from the Government that no prior commitments had been made to anyone in connection with development of the gaming industry in Bermuda”.

Mr Dunch added: “A cornerstone of the Bermuda gaming model will be robust background investigations of all participants, ensuring that they are free of any past or present inappropriate behaviours or associations, and that they uphold the highest standards of character, honesty and integrity.

“It would therefore be contrary to the commission’s whole method of operation for anyone to have suggested or now suggest to any third party that they could participate in the developing industry” without first having met this test.

But the agreement signed by Mr Crockwell and witnessed by Mr Pettingill clearly had given MM&I the expectation that it was in the running for a profitable deal.

As Mr Tartaglia wrote to the commission’s lawyer: “[We] think it is very important to reiterate the history of our efforts. Specific direction was given to MM&I throughout the stated timeline by the most senior Ministers, and during our Cabinet presentations [about the kind of system required for Bermuda].”

And to Mr Dunch, he said: “Continuing our commitment under the MOU [memorandum of understanding], we have further developed and invested in our systems, technology and gaming program support services offerings.”

Perhaps, too, the company felt that a financial donation it made to the Government, at Mr Crockwell’s request, would stand it in good stead when contracts involving the casino industry were being awarded. According to a corporate memory timeline drawn up by MM&I, the company made a donation of $30,000 to support efforts to convince the electorate to vote “yes” in the promised referendum on whether Bermuda should legalise gambling.

The note in the timeline states: “MM&I requested by Minister Crockwell to consider supporting ‘Jobs Bermuda’ — a marketing campaign to support the Bermuda Government’s position on the referendum on gaming and to forecast the attributes and benefits of job creation for Bermudians in the Bermuda gaming industry.”

The donation was made, according to MM&I, but the Government decided against the referendum.

The decision to bypass that ballot prompted much criticism from the PLP, including from Mr Burt and Mr DeSilva.

But Mr Crockwell told a public meeting: “Sometimes promises are broken for the better good.”

By May 3 this year, it was clear that MM&I was getting nowhere in selling Banyan’s product to the Government or the commission.

The day before, in fact, the commission’s lawyer had written to Mr Tartaglia with a list of concerns about Banyan’s predecessor company, Atlantic City Coin & Slot, which was run by Mr Seelig and his father, Mac Seelig, in Pleasantville, New Jersey.

The lawyer wrote that she had questions about AC Coin & Slot’s “history of regulatory difficulties in markets in which they were licensed”.

Those included the surrender of a gaming licence in New Jersey and a ban on re-entering the market for five years and “fines and continued admonishments” by Pennsylvania regulators for “failure to comply with the reporting requirements for the company’s financial statements”.

The letter referred to MM&I and Banyan’s joint response to the Government advertisement and the five individuals listed therein as references, many of them known personally to Mr Schuetz.

The Royal Gazette has seen the submission made by the two companies and the references include Steve Wynn, the American billionaire famous for his involvement in the luxury casino and hotel industry in America.

The submission states: “Please note that due to the high profile of these references, these individuals have requested that their contact details are kept confidential and are not published in the [submission]. MM&I will facilitate introductions upon request.”

Mr Schuetz, a US gambling industry veteran with experience both as a casino CEO and as a regulator, contacted the referees directly.

The commission’s lawyer wrote in her letter to Mr Tartaglia: “The written and verbal responses from these individuals was generally less than glowing and the commission is puzzled as to why such individuals would be included as references for your company.”

She added: “To attempt to bring an operator on to the island that apparently cannot be licensed in at least two major US gaming jurisdictions is something the commission would appreciate your help in understanding.

“We would also appreciate your explanation as to why your listed references seem unwilling to endorse you.”

Whether the PLP carried out any background checks on the members of its “very esteemed” panel — or whether it has had any talks behind closed doors with MM&I and Banyan about its product — is not known.

Yesterday, we asked Mr Burt, Mr DeSilva and Ms Wilkerson about background checks but did not receive a response by press time. Tourism minister Jamahl Simmons did not answer a specific question about whether Government was still considering a deal with MM&I and Banyan.

Ms Wilkerson told the forum: “The position of the Progressive Labour Party is that we are not promoting any particular technology at all.

“We just want to raise the conversation about technology and about the future of gaming.”

A month after the forum, the OBA was facing a vote of no-confidence in Parliament, with Mr Crockwell publicly pledging to vote against the Government and Mr Pettingill positioned to cast the deciding vote.

Michael Dunkley, then the Premier, avoided the vote by calling a General Election and the PLP won by a massive majority on July 18.

The new government has said little on gaming since, with no mention in the Throne Speech of any plans.

But the commission recently awarded the first provisional casino licence to the Hamilton Princess Hotel & Beach Club, partnered with Colorado-based Century Casinos, edging the island a step closer to the reality of casino gaming.

A public hearing for that licence learnt the hotel had “no plans for cashless gaming”. Yet the gaming commission remains concerned that MM&I and Banyan’s cashless gaming system could still be under consideration by the Government.

Mr Schuetz warned the commission’s lawyer, in his August 2 e-mail, that Banyan could be trying to distance themselves from Jason Seelig and Mac Seelig’s involvement in the company in order to enter the Bermuda market “without any legacy licensing issues”.

Banyan has not responded to requests from The Royal Gazette for comment. Digital Gaming Corporation USA acquired Jason Seelig’s 50 per cent share in the company in July.

Keith Furlong, from DGC USA, said Jason Seelig was no longer a shareholder in Banyan or DGC USA and the company did not want to comment further.

Tourism minister Mr Simmons, in response to questions about Banyan and MM&I, said his ministry’s focus was on making sure adequate gaming regulations were in place and “ensuring a clean gaming industry that benefits Bermudians first”.

• To view documents obtained in response to a Pati request to the Bermuda Casino Gaming Commission, click on the PDF links under “Related Media”

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