Macau Casino Artificial Intelligence Surveillance Rule: Experts Weigh In

Posted on: August 6, 2019, 11:54h. 

Last updated on: August 6, 2019, 12:15h.

Ed Silverstein @casinoorgedsilv Read More

Expertise: Legal, Tribal Gaming.

Macau’s new rule on artificial intelligence (AI)-based surveillance of gaming venues has lawyers and technology specialists warning about its drawbacks. They also praise some positives found in the July 30 directive from the island’s Gaming Inspection and Coordination Bureau.

Casino officials in the Chinese gambling enclave were told not to install surveillance tools, such as facial recognition, that the bureau has yet to approve, Bloomberg reported. The July 30 directive also told venues that data must remain with casino operators, and limits the use of the advanced technology.

In response, William C. Banks, an emeritus professor of law at Syracuse University, advised that, “particularly in a location such as Macau, law has little bearing on what casinos may do or what rights gamblers may have, except to the extent enforced by Chinese law.

“Like other activities that are highly digitized, AI, facial recognition and other technologies may be widely employed,” Banks told Casino.org. “The dynamic growth of capabilities in these fields means that any limits imposed by the casinos will likely need to be revisited frequently to assure that they are meeting their objectives.”

Also, Anthony Cabot, Distinguished Fellow of Gaming Law at UNLV Boyd School of Law, told Casino.org, he hopes “the restriction is a temporary measure to allow the bureau to study the use and implementation of AI and facial recognition.

The emerging issue is not the use of these technologies, but their potential abuse,” Cabot explained. “There simply is not enough experience and vetting of these technologies to understand their uses in the casino industry to properly consider new regulations.”

He also fears regulators “will approve technologies not based on evidence-based facts, but simply what they feel is appropriate. This is particularly problematic in a Macau where the regulatory process is not transparent.”

Technology Can Help Venues Meet Patrons’ Needs

David W. Opderbeck, co-director of the Gibbons Institute of Law, Science & Technology at Seton Hall University School of Law, where he also teaches law, on one hand, said “this seems like a positive development.

“Many businesses use data analytics and other forms of AI to monitor consumer behavior,” he told Casino.org. “This isn’t necessarily a bad thing — it can help businesses better serve their customers while also maximizing profits.”

“This kind of AI seems fundamentally to change the rules of the game,” he cautioned. Opderbeck confirmed the use of the technology can allow the casino to personalize patrons’ experiences.

“This can be a very good thing, both for the casinos and their patrons,” he said. “The technology can also improve security and detect cheating. The issue is how to use the technology for these purposes without fundamentally changing the customers’ legitimate expectation that there is at least a fair possibility of beating the house.”

Overall, Konstantinos Pelechrinis, a computer science professor at the University of Pittsburgh, where he also leads the Network Data Science Lab, told Casino.org that regulators have a very tough task, “not only in the case of casinos, but for every business that attempts to exploit personal data for maximizing their revenue.”

Casinos and the gambling industry are different from an online retailer that may try to obtain better recommendations from customers. “For example, one can argue that a retailer is going to use your preferences and other information to let you know about new things that you do not know,” he said.

“What does this look like for a casino? Recommending a roulette game that you know your chances of winning are low?”

Based on news reports, Pelechrinis said casinos on Macau may be “targeting high-risk people to extract higher revenue.

“So, the actual question that … regulators need to answer is: What do the casinos that use [the] … tech attempt to do? For instance, this tech can be used for good — for example, identifying high-risk gamblers and not allowing them to gamble more,” he said.

Regulation is needed, Pelechrinis said. “But instead of fully banning this technology, the regulators might want to think how this technology can be used for benefiting both the operators and the customers,” he said.

Felix Wu, faculty director of the Cardozo Data Law Initiative and a professor at Cardozo School of Law, told Casino.org that, “To the extent that the casino’s data collection is merged with that of others or made available to others, it contributes to concerns over mass surveillance by the government or private companies.

“There’s probably not the same social interest in people being able to gamble anonymously as there is in people being able to generally live their lives with some measure of anonymity,” Wu added.

“Information is power, and concerns have been raised about companies’ ability to leverage personal data in order to exploit individual consumers’ irrationality. This seems like a particular concern in the gambling industry,” Wu explained.

“People are predictably irrational when it comes to gambling.  It would be highly problematic if casinos are able to target individual gamblers in a way that optimally exploits each individual’s irrationalities,” he added.

Macau Venues Test Tech

Earlier this year, Macau casinos were suspected of initially using AI to monitor habits of VIP patrons and identify those who are likely to spend a lot of money and perhaps lose a lot.

Last month, two to three casinos were testing surveillance technology. In June, gaming inspection bureau officials said that facial recognition technology would be used just for security in Macau.