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Massachusetts Attorney General Martha Coakley has asked state gambling regulators to bar casinos from placing liens on the homes of people with unpaid gambling debts.
"Protecting against predatory lending and overly aggressive debt collection in the gaming industry is critical, because the odds are stacked against the patron being able to earn back the value of the loan," Coakley wrote in a letter sent Monday to the Massachusetts Gaming Commission.
Coakley cited an article that appear in The Boston Globe on Sunday that detailed the practice by Connecticut-based Mohegan Sun and Foxwoods casinos of placing liens on homes of residents who owe the casinos money advanced for gambling.
"This story highlights the need for a robust set of consumer protection regulations before these establishments begin operations," Coakley wrote.
A lien ensures that creditors get paid if the home is sold.
Mohegan Sun is competing for a license to build a casino on a 42-acre portion of the Suffolk Downs horse track in Revere. Foxwoods is pursuing a casino in Fall River.
Casino industry specialists have said it is unusual for a gambling business to employ property liens as a collection tactic.
Mohegan Sun officials defended the practice. "Over time it is expected that debts would be collected, as they would be at Lowe's or Sears or anything along those lines," Mohegan Sun CEO Mitchell Etess told the Boston Herald.
Foxwoods said it does not discuss issues involving possible litigation.
The gambling commission has yet to write rules on casino credit to customers, as well as collection methods.
The panel intends to place the issue on the agenda of an upcoming meeting, commission spokeswoman Elaine Driscoll said.
Coakley offered to help craft the rules.