Where you gonna fall?
When you realize
You just can't have it all
In casino circles, the name they use to refer to people who gamble big money is "whales." And they call people who are lousy gamblers "suckers."
This makes Terrance Watanabe the ultimate "sucker whale."
In one year Watanabe lost $127 million to two Las Vegas casinos.
The Wall Street Journal, as well as some other publications, tell Watanabe's story. He inherited an incredible business from his father, importing party favors. He sold the business in 2000 and developed a new hobby, gambling.
Now he is looking at criminal charges. In Vegas, they put you in jail if you stiff a casino. Terrance ponied up $117 million but balked the additional $14.7 million the casinos claim that he owes.
Watanabe is suing the casinos. He claims they plied him with booze and drugs to keep him gambling.
No one is going to feel sorry for a guy like Watanabe. His own attorney says that Watanabe "takes full responsibility for his condition at the time...He's not saying that 'the devil made me do it.'"
On the other hand, corporately-owned casinos don't have the kind of regulations that stock and commodities traders have. They don't even follow the norms and mores of the way casinos were run when the mafia ran them.
Stock brokers are governed by "know your customer" rules, and more than one broker has been busted for letting a trading client get out of control. I grew up around gamblers and bookies who would frequently get together and cut-off "suckers" who were on their way to going broke.
Cutting off a loser makes good business sense. Having a client go completely bust is bad publicity for a casino, in particular, and for gambling, in general. It shows the world that problem-gambling has a downside and a cost.
Few problem gamblers run through $127 million. They don't have that much money.
I have seen people lose their houses, their savings and their lives because of problem gambling.
Earlier this year, I read an excellent book about casinos, Winner Takes All, by Christina Brinkley. One of the most fascinating things I noted was how casinos use their "rewards cards" to track the spending and gambling habits of their patrons.
A friend told me that she liked to play slot machines. She was constantly bombarded by the casino with "comps," such as free dinners, free rooms and all kinds of things to entice her to gamble. She wondered why her husband, who is a big-stakes poker player, was never offered any comps.
That is because slot machines make huge profits for casinos. Casinos don't make much money on poker.
The casinos have smart business people running them. That is why they target "whales" like Terrance Watanabe.
The Wall Street Journal noted that even though revenues from all gambling declined by 19% in the last 12 months, spending increased from people playing Baccarat.
Baccarat is a game that is a favorite of whales.
I'm not a whale, or even a tiny minnow, but Baccarat is one of the few casino games I will play. That is because the odds give the gambler closer to an even break against the house.
Watanable was a lousy whale. He was considered a "house" player because he liked slot machines and roulette, where the odds heavily favor the casino. Apparently, Watanabe was not cut out for gambling in any form. The casino assigned him "handlers" and one of them said, "The way he played blackjack, he made it a house game."
They weren't going to throw Watanable out of the casino for card counting. In fact, they weren't going to throw him out for anything. Until he tapped out of money.
Watanable had big problems and his seemingly unlimited stream of money made matters worse. You have to wonder if he was ever going to figure out that gambling wasn't for him.
If he had stopped gambling after dropping $100 million, he would have been left with at least $17 million.
Most of us can get by on $17 million. At least for a little while.
I've watched a lot of "whales," inside the casino and out, blow through big money. A lot of people who blow money have an entourage or lots of hangers-on. It doesn't appear that Watanable did. He did a lot of stupid things, such as going to a supermarket, buying all the steaks and handing them to casino employees. But it seems that he was more of a loner.
A loner with a lot of money.
Who had "friends" at the casino until he ran out of money.
And who could go to jail for not paying his bets after the money ran out.
Don McNay, CLU, ChFC, MSFS, CSSC is one of the world's leading authorities in helping people deal with "Big Money" issues.
McNay is an award winning, syndicated financial columnist and Huffington Post Contributor.
You can read more about Don at www.donmcnay.com
McNay founded McNay Settlement Group, a structured settlement and financial consulting firm, in 1983 and Kentucky Guardianship Administrators LLC in 2000. You can read more about both at www.mcnay.com
McNay has Master's Degrees from Vanderbilt and the American College and is in the Eastern Kentucky University Hall of Distinguished Alumni.
McNay has written two books. Most recent is Son of a Son of a Gambler: Winners, Losers and What to Do When You Win The Lottery
McNay is a lifetime member of the Million Dollar Round Table and has four professional designations in the financial services field.