"We are resolved to address these problems comprehensively and decisively," he said.
At the time of the sting, the subsidiaries that ran the nightclubs were only partially owned by the Palms. "They're now fully owned (subsidiaries) so we have a lot more oversight and visibility into the organization," Acuna told The Associated Press.
He said the Palms is also implementing mandatory drug testing, setting up a whistle-blower system and making changes in its security department to discourage employees from straying outside the law to meet customers' requests.
The casino just west of the Las Vegas Strip is also installing "amnesty boxes" at club entrances, where patrons can dump drugs before entering the casino without fear of legal repercussions.
The $1 million fine must be approved by the Nevada Gaming Commission. The Palms has also agreed to pay $78,000 for investigation expenses.
Associated Press writer Joseph Altman in Phoenix contributed to this report.