This is the law he is referring to. Operating without a license. Something I am sure could draw a stiff fine if I had to guess.

AN ACT relating to gaming; defining certain terms related to interactive gaming; requiring the Nevada Gaming Commission to adopt regulations authorizing the Governor to enter into agreements with other states to conduct interactive gaming; prohibiting the issuance of licenses to operate interactive gaming to certain persons; revising provisions related to interactive gaming; and providing other matters properly relating thereto.

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Legislative Counsel’s Digest:

***** Existing law authorizes certain gaming establishments to obtain a license to operate interactive gaming. (NRS 463.750)Sections 2-5*of this bill define certain terms for the purposes of determining whether a person may be found suitable for a license to operate interactive gaming.*Section 6*of this bill requires the Nevada Gaming Commission to adopt regulations authorizing the Governor to enter into agreements with other states to allow patrons of those states to participate in interactive gaming.

***** Existing law requires the Commission to establish by regulation that a license to operate interstate interactive gaming does not become effective until: (1) the passage of federal legislation authorizing interactive gaming; or (2) the United States Department of Justice notifies the Commission or the State Gaming Control Board that interactive gaming is permissible under federal law. (NRS 463.750)*Section 10*of this bill removes the condition that a license to operate interactive gaming does not become effective until the passage of federal legislation or notice providing that interactive gaming is permissible under federal law.*Section 10*also prohibits the issuance of a license to operate interactive gaming for a period of 5 years after the effective date of this bill for certain entities that, after December 31, 2006, operated interactive gaming involving patrons located in the United States. Finally,*section 10*authorizes the Commission to waive such prohibition if the Commission determines that those entities complied with all applicable provisions of federal law or the law of any state when, after December 31, 2006, those entities operated interactive gaming involving patrons located in the United States.

***** Section 11*of this bill authorizes the Commission to adopt regulations to increase or decrease the fees for the initial issuance and the renewal of a license for an establishment to operate interactive gaming under certain circumstances. (NRS 463.765)