N.J. Admin. Code § 13:69C-8.8

Current through Register Vol. 56, No. 21, November 4, 2024

Section 13:69C-8.8 - Compliance system

(a) The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise:

"Affiliate" is defined in 13:69-1.2.

"Compliance committee" means a group of natural persons who are responsible for the review and evaluation of the conduct of the casino licensee, its holding companies and affiliates in accordance with an approved compliance review and reporting system and this section.

"Compliance officer" means the individual who is responsible for the daily operations of the approved compliance review and reporting system in accordance with this section.

"Compliance review and reporting system" means a written plan to be implemented by each casino licensee or a holding company thereof in accordance with this subchapter, for purposes of ensuring the good character, honesty and integrity of the casino licensee, its holding companies, affiliates and employees in accordance with the Act.

"Executive employee" means an employee who by reason of his or her management or policy-making position exercises authority, discretion or influence over decisions concerning the operations of the company, whether or not such individual is required to be qualified by the Commission.

"Gaming authority" shall mean the applicable gaming board, commission, or other governmental gaming regulatory authority, body or agency of any state of the United States that has an established system of regulation of casino gaming activities and responsible for interpreting, administering and enforcing gaming laws.

"Gaming laws" shall mean all applicable constitutions, treatises, laws and statutes pursuant to which any gaming authority possesses regulatory, licensing or permitting authority over gaming, gambling or casino or casino-related activities and all rules, rulings, orders, ordinances and regulations of any gaming authority applicable to the gambling, casino, gaming businesses or casino or casino-related activities of a casino licensee, or any of its subsidiaries or affiliates, in any jurisdiction.

"Public official" with respect to New Jersey means any "person" as defined in N.J.S.A. 5:12-102n. With respect to other jurisdictions, "public official" means the governor and lieutenant governor of a state and their chief counsels and chiefs of staff; members of the legislative and judicial branches of state government; any person holding a position or employment as head of any department, division, board, bureau, office, commission or other instrumentality of the executive, legislative or judicial branches of state government; any person holding any position or employment in state government or any independent state authority, commission, agency or instrumentality with responsibility for matters affecting any casino activity or proposed casino activity except clerical and non-professional employees; any member of the governing body, or a judge, or an attorney of a municipality or county, or an equivalent political subdivision, wherein a casino is located or may become located; and, any member of or attorney or planner or engineer for or consultant to any planning board or other land-use instrumentality wherein a casino is located or may become located.

(b) Each casino licensee or a holding company thereof shall implement a compliance review and reporting system for the casino licensee, its holding companies and affiliates in accordance with a written plan that meets the requirements of this subchapter.

(c) The compliance review and reporting system shall, at a minimum, establish standards and procedures for the following:

1. The monitoring of policies, procedures, material transactions and proposed transactions for purposes of avoiding impropriety or the appearance thereof;

2. Ensuring compliance with all applicable Federal, State and local laws and regulatory requirements;

3. Protecting against unethical or unlawful behavior by employees;

4. The conduct of due diligence reviews and investigations of the following:

i. Corporate officers, directors and executive employees or their non-corporate equivalents except if the person is currently licensed or qualified by a public agency pursuant to standards essentially equivalent to those in the Casino Control Act, 5:12-1 et seq.; and

ii. All entities and individuals including, but not limited to, consultants, having any material association or proposed association with efforts by the company to pursue gaming opportunities in any jurisdiction not having a distinct system which regulates such activity; and

5. Requiring prior compliance committee approval or prior compliance officer approval with prompt notice to the compliance committee in such instances, and prompt notice to the Division, of all payments to, business associations with, or provision of services, gifts or any thing of value to or on behalf of any public official of a jurisdiction in which the casino licensee, its holding companies or affiliates conducts gaming or new development or ballot initiative activities. For purposes of this subchapter, "thing of value" shall not include any service or item offered to the general public at the usual rate; complimentaries based on gaming activity; lawful political contributions; plaques, certificates or other ceremonial items; and, other services or items the aggregate value of which does not exceed $ 1,000 annually.

(d) The written compliance plan, and any amendments thereto, shall be provided to the Division.

(e) The casino licensee or holding company, as applicable, shall designate an individual to serve as a compliance officer in accordance with this subchapter. The compliance officer shall be an individual who has been found qualified by the Commission under the Act.

1. The compliance officer shall report directly to the compliance committee on matters related to this subchapter. All reports prepared by the compliance officer relating to the compliance review and reporting system shall be filed with the compliance committee.

2. The compliance officer shall have no functions which are incompatible with his or her duties and responsibilities as a compliance officer as set forth in this subchapter. Such incompatible functions shall include, without limitation, market development activities.

3. The compliance officer shall:

i. Notify the compliance committee in writing of the following:

(1) All efforts by the casino licensee, its holding companies, affiliates or employees in connection with the development of gaming activities in any jurisdiction not having a distinct system which regulates such activity, and the names of all individuals and business entities including, but not limited to, consultants, having any material association or proposed association with such efforts; and

(2) All outstanding material litigation involving the casino licensee, its holding companies or affiliates or any executive employee, which is not routine business litigation such as, without limitation, negligence, workers compensation and employment claims; and

ii. Provide the Division with notice of the information in (e)3i above at least semi-annually on or before January 1st and July 1st of each year.

(f) The casino licensee or holding company, as applicable, shall establish a compliance committee consisting of at least three members, each qualified by the Commission under the Act. At least one member thereof shall not hold any employee, officer, executive or operational position with the casino licensee, its holding companies or affiliates, and one or more members of the committee shall be familiar with the New Jersey gaming regulatory process.

1. The compliance committee shall meet at least once a calendar quarter.

2. The compliance committee shall not report to any employee, officer, executive or operational person or entity within the casino licensee, its holding companies or affiliates, and shall file its reports and recommendations with the company's board of directors and the general counsel.

3. The written agenda for each meeting of the compliance committee shall be promptly filed with the Division, and the minutes for each such meeting, whether or not ratified or adopted, shall be filed with the Division in accordance with 13:69C-8.1.

4. Any casino licensee or holding company thereof which has a compliance committee constituted in accordance with gaming laws shall be entitled to utilize that committee for purposes of this subchapter, provided that the charter for such committee expressly imposes responsibility for compliance with this subchapter and the committee and its members meet the requirements of this subchapter.

(g) Any information or documents obtained, maintained, prepared or communicated by, to or on behalf of the compliance officer, compliance committee, general counsel, or board of directors or their agents, in connection with any policy implemented in accordance with this subchapter shall be maintained in accordance with 5:12-74.1.

(h) Nothing in this subchapter shall be construed to preclude any casino licensee from utilizing:

1. Its independent audit committee, formed in accordance with 13:69D-1.11(c), to assume the duties and perform the functions of the compliance committee mandated by this subchapter, provided that the charter for such committee expressly imposes responsibility for compliance with this subchapter; and

2. Its audit department executive required by 13:69D-1.11(b)2 to assume the duties and perform the functions of the compliance officer required by this subchapter.

(i) No person shall concurrently serve in the following three positions of a casino licensee, its holding companies, or affiliates:

1. Compliance officer;

2. Member of the compliance committee; and

3. Legal officer.

N.J. Admin. Code § 13:69C-8.8