American casinos, gaming companies and lawmakers are calling on federal prosecutors to crack down on illegal offshore gambling sites they say are circumventing consumer protection regulations.
In recent years, sports gambling has expanded rapidly in the United States, and this move is underway as more than 30 states and Washington, DC allow it.
“It may have been relatively annoying at one point, but it’s now a serious threat to the legitimately licensed gaming industry,” Bill Miller, CEO of the American Games Association, said in a recent interview. Told.
and Letter to Attorney General Merrick Garland This spring, AGA asked the Justice Department to investigate a well-known offshore gambling site. The site is openly in violation of federal and state law and is boldly paying for ads targeting US gamblers.
And on June 29, more than 20 members of parliament I sent a letter Ask the Justice Department to investigate and prosecute illegal offshore sportsbooks.
The Department of Justice has not yet responded to AGA’s letter or CNBC’s request for comment..
According to AGA, online searches for offshore sportsbooks last year increased faster than searches for regulated operators, escalating challenges for the gaming industry. According to a survey by the association, more than half of gamblers are still betting on offshore sites such as Bovada, MyBookie and BetOnline.
“There are hundreds of illegal or unregulated operators doing sports betting every day. We estimate that some of these offshore operators could pass $ 15 billion,” Fan Duel said. CEO Amy Howe told CNBC.
Legal personnel including Fan Duel Flutter, Draft Kings, Caesar And BetMGM, co-owned MGM Resorts When EntainSpend billions of dollars in licensing, marketing and lobbying for the legalization of sports betting in the new state.
According to the two companies, offshore operators are competing for customers without investing in licensing or lobbying, or paying state or local taxes.
“It gives them an unfair competitive advantage. They can offer better odds to consumers,” Howe said. She added that many players don’t even know when they are using illegal betting sites.
Some gamblers have been using offshore bookmakers for years before the Supreme Court overturned the Professional and Amateur Sports Protection Act in 2018 and paved the way for the state to legalize sports betting.
Justin Welllander, a professional gambler, says many high rollers use offshore gambling sites to enable larger transactions and accept credit.
Courtesy: Justin Welllander
Justin Wonderler, a New Jersey gambler, said he had been betting on sports offshore sites since he was the only option for sports betting in high school. Since then, he has been burned many times when he was unable to withdraw money from an offshore bookmaker.
“I was a little confused,” he said. “They ran away with my bounty, and that’s it. Sometimes bookmakers don’t pay when you win.”
Unregulated sites often ignore the responsible gambling safeguards that US operators are implementing to maintain their licenses, Howe said. She said that 25% of FanDuel’s customers switching from illegal operators do so because the prize wasn’t paid.
Still, some experienced gamblers continue to use unregulated sites with better odds and promotions, or to get high rollers to bet credit.In addition, some frequent gamblers may find that betting restrictions are limited in US legitimate sportsbooks.
According to Wonderler, offshore sites have much higher restrictions, including the experienced and knowledgeable gambler “shark.” “Some of them can go up to $ 50,000, but some of these legitimate sites can only bet $ 120,” he said.
According to the Games Association, online searches for offshore betting sites are declining in states that have legalized sports betting. However, offshore site Bobada still accounts for half of all sports betting-related searches across the country, AGA told CNBC.
According to AGA Miller, the gaming industry is partnering with Google and other Internet search engines to stop producing results on illegal sites.
The casino industry is also asking law enforcement agencies to crack down on unlicensed gambling machines that are often installed in taverns, minimarts, and gas stations.
Courtesy: American Game Association
The casino industry is also asking law enforcement agencies to crack down on unlicensed gambling machines commonly found in taverns, minimarts and gas stations. It looks and sounds like a slot machine, but to avoid gambling restrictions, manufacturers label it as a “skill-based” game.
“The important thing is that it hasn’t been tested. There is no quality assurance on the odds,” Miller said. And if the machine doesn’t pay, he said he’s rarely accountable from the host’s location.
Aristocrat Manufactures popular Buffalo slot machines and many other machines licensed in 300 US jurisdictions. CEO Hector Fernandez said an unregulated manufacturer stole designs and other intellectual property from the company.
Fernandez also said he was concerned about the lack of consumer protection from unregulated games.
The industry is working to educate players about unregulated businesses, but says it can be difficult to tell the difference between legal and illegal businesses.
“It’s all our job to educate the general public who don’t generally know if they’re betting on illegal sites or illegal sites,” Miller said.
