[Federal Register Volume 78, Number 34 (Wednesday, February 20, 2013)]
[Proposed Rules]
[Pages 11793-11795]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-03669]
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DEPARTMENT OF THE INTERIOR
National Indian Gaming Commission
25 CFR Part 543
RIN 3141-AA27
Minimum Internal Control Standards
AGENCY: National Indian Gaming Commission.
ACTION: Proposed rule.
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SUMMARY: The National Indian Gaming Commission (NIGC) proposes to amend
its minimum internal control standards for Class II gaming under the
Indian Gaming Regulatory Act to add standards for the drop and count
and surveillance of kiosks.
DATES: Submit comments on or before April 22, 2013.
ADDRESSES: You may submit comments by any one of the following methods,
however, please note that comments sent by electronic mail are strongly
encouraged.
[ssquf] Email comments to: reg.review@nigc.gov.
[ssquf] Mail comments to: National Indian Gaming Commission, 1441 L
Street NW., Suite 9100, Washington, DC 20005.
[ssquf] Hand deliver comments to: 1441 L Street NW., Suite 9100,
Washington, DC 20005.
[ssquf] Fax comments to: National Indian Gaming Commission at 202-
632-0045.
FOR FURTHER INFORMATION CONTACT: National Indian Gaming Commission,
1441 L Street NW., Suite 9100, Washington, DC 20005. Telephone: 202-
632-7009; email: reg.review@nigc.gov.
SUPPLEMENTARY INFORMATION:
I. Comments Invited
Interested parties are invited to participate in this proposed
rulemaking by submitting such written data, views, or arguments as they
may desire. Comments that provide the factual basis supporting the
views and suggestions presented are particularly helpful in developing
reasoned regulatory decisions on the proposal.
II. Background
The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497,
25 U.S.C. 2701 et seq., was signed into law on October 17, 1988. The
Act establishes the National Indian Gaming Commission (``NIGC'' or
``Commission'') and sets out a comprehensive framework for the
regulation of gaming on Indian lands. On January 5, 1999, the NIGC
published a final rule in the Federal Register called Minimum Internal
Control Standards. 64 FR 590. The rule added a new part to the
Commission's regulations establishing Minimum Internal Control
Standards (MICS) to reduce the risk of loss because of customer or
employee access to cash and cash equivalents within a casino. The rule
contains standards and procedures that govern cash handling,
documentation, game integrity, auditing, surveillance, and variances,
as well as other areas.
The Commission recognized from their inception that the MICS would
require periodic review and updates to keep pace with technology, and
has amended them numerous times, most recently on September 21, 2012.
77 FR 58708.
III. Development of the Proposed Rule
On September 21, 2012, the Commission concluded nearly two years of
consultation with the publication of comprehensive amendments,
additions, and updates to Part 543, the minimum internal control
standards (MICS) for Class II gaming operations. The regulations
require tribes to establish controls and implement procedures at least
as stringent as those described in this part to maintain the integrity
of the gaming operation and minimize the risk of theft.
One of the 2012 additions was the inclusion of kiosks, devices
capable of redeeming vouchers or and/or wagering credits or initiating
transfers from a patron deposit account. The regulation provided
general standards for kiosks, but upon further review, additional
standards are needed for the drop and count and surveillance of kiosks
to adequately protect against risk of loss.
Regulatory Matters
Regulatory Flexibility Act
The proposed rule will not have a significant impact on a
substantial number of small entities as defined under the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq. Moreover, Indian Tribes are not
considered to be small entities for the purposes of the Regulatory
Flexibility Act.
Small Business Regulatory Enforcement Fairness Act
The proposed rule is not a major rule under 5 U.S.C. 804(2), the
Small Business Regulatory Enforcement Fairness Act. The rule does not
have an effect on the economy of $100 million or more. The rule will
not cause a major increase in costs or prices for consumers, individual
industries, Federal, State, local government agencies or geographic
regions, nor will the proposed rule have a significant adverse effect
on competition, employment, investment, productivity, innovation, or
the ability of the enterprises, to compete with foreign based
enterprises.
Unfunded Mandate Reform Act
The Commission, as an independent regulatory agency, is exempt from
compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2
U.S.C. 658(1).
Takings
In accordance with Executive Order 12630, the Commission has
determined that the proposed rule does not have significant takings
implications. A takings implication assessment is not required.
Civil Justice Reform
In accordance with Executive Order 12988, the Commission has
determined that the proposed rule does not unduly burden the judicial
system and meets the requirements of sections 3(a) and 3(b)(2) of the
Order.
National Environmental Policy Act
The Commission has determined that the proposed rule does not
constitute a major federal action significantly affecting the quality
of the human environment and that no detailed statement is required
pursuant to the National Environmental Policy Act of 1969, 42 U.S.C.
4321, et seq.
Paperwork Reduction Act
The information collection requirements contained in this rule were
previously approved by the Office of Management and Budget as required
by 44 U.S.C. 3501, et seq., and assigned OMB Control Number 3141-0009.
The OMB control number expires on October 31, 2015.
[[Page 11794]]
Text of the Proposed Rules
List of Subjects in 25 CFR Part 543
Gambling, Indian--Indian lands, Indian--tribal government.
For the reasons discussed in the Preamble, the Commission proposes
the text of its regulations at 25 CFR part 543 to be amended as
follows:
PART 543--MINIMUM INTERNAL CONTROL STANDARDS FOR CLASS II GAMING
0
1. The authority citation for part 543 continues to read as follows:
Authority: 25 U.S.C. Sec. Sec. 2702(2), 2706(b)(1-4),
2706(b)(10).
0
2. Amend Sec. 543.2 by adding a definition for currency cassette in
alphabetical order to read as follows:
Sec. 543.2 What are the definitions for this part?
* * * * *
Currency cassette. A locked compartment that contains a specified
denomination of currency. Currency cassettes are inserted into kiosks,
allowing them to dispense currency.
* * * * *
0
3. Amend Sec. 543.17 by revising paragraphs (h) and (i) and adding
paragraphs (j) and (k) to read as follows:
Sec. 543.17 What are the minimum internal control standards for drop
and count?
* * * * *
(h) Kiosk drop, count, and fill standards. Controls must be
established and procedures implemented to ensure security of the kiosk
drop and count processes. Such controls must include the following:
(1) Surveillance must be notified when the drop process is to begin
so that surveillance may monitor the activities.
(2) At least three agents must be involved in the drop process and
at least one agent should be independent of kiosk accountability.
(3) Currency cassettes and financial instrument storage components
must be dropped and secured in a manner that restricts access to only
authorized agents.
(4) Any time the financial instrument storage components or
currency cassettes are accessed, and prior to any transactions being
processed through the kiosk, an agent independent of the count must run
a kiosk report.
(i) The report must reflect the following:
(A) Date and time;
(B) Unique asset identification number of the kiosk;
(C) Unique identification number for each financial instrument
storage component in the kiosk;
(D) Total amount of currency dispensed;
(E) Total number of bills dispensed by denomination;
(F) Total dollar amount of vouchers accepted;
(G) Total number of vouchers accepted.
(ii) The report may not be viewed by any member of the count team
and must be immediately forwarded to accounting or placed in a secure
storage area where it is not accessible by the count team.
(5) Redeemed vouchers and pulltabs (if applicable) collected from
the drop must be secured and delivered to the appropriate department
(cage or accounting) for reconciliation.
(6) After completing a fill and prior to the first transaction, the
team must test the machine to verify that currency cassettes contain
the correct denominations and have been properly installed.
(i) Kiosk count standards.
(1) Access to stored full kiosk financial instrument storage
components and currency cassettes must be restricted to:
(i) Authorized members of the drop and count teams; and
(ii) In an emergency, authorized persons for the resolution of a
problem.
(2) The kiosk count must be performed in a count room or other
equivalently secure area with comparable controls.
(3) Access to the count room during the count must be restricted to
members of the drop and count teams, with the exception of authorized
observers, supervisors for resolution of problems, and authorized
maintenance personnel.
(4) If counts from various revenue centers and kiosks occur
simultaneously in the count room, procedures must be in effect that
prevent the commingling of funds from the kiosks with any revenue
centers.
(5) The count team must not have access to the reconciliation
report amounts until after the count is completed and the drop proceeds
are accepted into the cage/vault accountability.
(6) Count equipment and systems must be tested, and the results
documented, before the first count begins, to ensure the accuracy of
the equipment.
(7) If a currency counter interface is used:
(i) It must be adequately restricted to prevent unauthorized
access; and
(ii) The currency drop figures must be transferred via direct
communications line or computer storage media to the accounting
department.
(8) The kiosk financial instrument storage components and currency
cassettes must be individually emptied and counted so as to prevent the
commingling of funds between kiosks until the count of the kiosk
contents has been recorded.
(i) The count of each kiosk must be recorded in ink or other
permanent form of recordation.
(ii) Coupons or other promotional items not included in gross
revenue (if any) may be recorded on a supplemental document by the
count team members or accounting personnel. All single-use coupons must
be cancelled daily by an authorized agent to prevent improper
recirculation.
(9) If currency counters are utilized, a count team member must
observe the loading and unloading of all currency at the currency
counter, including rejected currency.
(10) Two counts of the currency rejected by the currency counter
must be recorded per kiosk as well as in total. Rejected currency must
be posted to the kiosk from which it was collected.
(11) Financial instrument storage components and currency
cassettes, when empty, must be shown to another member of the count
team, to another agent who is observing the count, or to surveillance,
provided that the count is monitored in its entirety by an agent
independent of the count.
(12) Procedures must be implemented to ensure that any corrections
to the count documentation are permanent, identifiable, and the
original, corrected information remains legible. Corrections must be
verified by two count team agents.
(13) The count sheet must be reconciled to the total drop by a
count team member who may not function as the sole recorder, and
variances must be reconciled and documented.
(14) All count team agents must sign the report attesting to their
participation in the count.
(15) A final verification of the total drop proceeds, before
transfer to cage/vault, must be performed by at least two agents, one
of whom is a supervisory count team member and the other a count team
agent.
(i) Final verification must include a comparison of currency
counted totals against the currency counter/system report (not the
report generated by the kiosk), if a counter/system is used.
(ii) Any unresolved variances must be documented and the
documentation must remain a part of the final count record forwarded to
accounting.
[[Page 11795]]
(iii) This verification does not require a complete recount of the
drop proceeds but does require a review sufficient to verify the total
drop proceeds being transferred.
(iv) The two agents must sign the report attesting to the accuracy
of the total drop proceeds verified.
(v) All drop proceeds and cash equivalents that were counted must
be turned over to the cage or vault cashier (who must be independent of
the count team) or to an agent independent of the revenue generation
and the count process for verification. Such cashier or agent must
certify, by signature, the amount of the drop proceeds delivered and
received. Any unresolved variances must be reconciled, documented, and/
or investigated by accounting/revenue audit.
(16) After certification by the agent receiving the funds, the drop
proceeds must be transferred to the cage/vault.
(i) The count documentation and records must not be transferred to
the cage/vault with the drop proceeds.
(ii) The cage/vault agent must not have knowledge or record of the
drop proceeds total before it is verified.
(iii) All count records must be forwarded to accounting secured and
accessible only by accounting agents.
(iv) The cage/vault agent receiving the transferred drop proceeds
must sign the count sheet attesting to the verification of the total
received, and thereby assuming accountability of the drop proceeds, and
ending the count.
(v) Any unresolved variances between total drop proceeds recorded
on the count room report and the cage/vault final verification during
transfer must be documented and investigated.
(17) The count sheet, with all supporting documents, must be
delivered to the accounting department by a count team member or agent
independent of the cashiers department. Alternatively, it may be
adequately secured and accessible only by accounting department.
(j) Controlled keys. Controls must be established and procedures
implemented to safeguard the use, access, and security of keys in
accordance with the following:
(1) Each of the following requires a separate and unique key lock
or alternative secure access method:
(i) Drop or player interface cabinet;
(ii) Drop box or financial instrument storage component release;
(iii) Drop box or financial instrument storage component contents;
and
(iv) Storage racks and carts.
(v) Kiosk currency cassettes
(k) Variances. The operation must establish, as approved by the
TGRA, the threshold level at which a variance must be reviewed to
determine the cause. Any such review must be documented.
0
4. Amend Sec. 543.21 by adding paragraph(c)(6) to read as follows:
Sec. 543.21 What are the minimum internal control standards for
surveillance?
* * * * *
(c) * * *
(6) Kiosks: The surveillance system must monitor and record a
general overview of activities occurring at each kiosk with sufficient
clarity to identify the activity and the individuals performing it,
including maintenance, drops or fills, and redemption of wagering
vouchers or credits.
* * * * *
Tracie L. Stevens,
Chairwoman.
Daniel J. Little,
Associate Commissioner.
[FR Doc. 2013-03669 Filed 2-19-13; 8:45 am]
BILLING CODE 7565-01-P