For U.S.-based public gaming enterprises, the threat of an illegal insider trading scandal may jeopardize a gaming license, or even the survival of the business. The alleged use of nonpublic information for unwarranted personal gain quickly destroys the trust of shareholders and regulators in the company and its executive team. To address this risk, companies employ policies and procedures, and sign executive compliance statements and oversight by compliance officers, among other things. However, many do not adequately bridge the gap between these techniques and the practices, policies and procedures that govern gaming activities.
Many publicly held gaming companies have failed to include provisions for insider trading in their gaming compliance policies and procedures, and likewise have ignored the need to train officers, directors and rank-and-file employees on this serious matter. Interlacing existing insider trading policies and procedures with a gaming compliance program, and then instructing personnel on how to understand and use the materials, provides an extra safeguard to ensure compliance. It is also advisable to take advantage of the expertise of the gaming compliance officer when developing training programs and implementing the plan across all facets of the business. These types of activities help maintain the integrity and reputation of the company, especially with gaming regulators.
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