AGA To DOJ: Crack Down On Illegal Gambling Websites

AGA To DOJ: Crack Down On Illegal Gambling Websites

In its most aggressive effort yet, the American Gaming Association on Thursday released a letter sent to U.S. Attorney General Merrick Garland calling on the Department of Justice to crack down — hard — on illegal offshore sportsbooks.

The  AGA’s written request specifically singles out Bovada, MyBookie, and BetOnline as companies that “openly violate federal and state laws.” Unregulated “skill game” machines also are a suitable target for the DOJ, wrote AGA President Bill Miller in following up on his pledge to go after these operators back in February.

“While the challenge of illegal gambling is not new, the brazen and coordinated manner in which it occurs — both online and in communities — has elevated this problem to a level that requires significant federal attention,” Miller added. “We urge the Department to make it a priority to act … to protect American consumers, crack down on illegal operators, and enforce federal regulations.”

The AGA recommends that the DOJ “educate consumers on legal gaming options and the dangers associated with illegal operations;” investigate and indict the largest offshore operations; and clarify that skill-based machine manufacturers must comply with anti-money laundering standards. The association called on the government to pursue “aggressive enforcement actions against entities that do not fully comply.”

Miller underscored the AGA’s sentiments by writing, “Illegal operators have been put on notice: Their days as a scourge on our nation are numbered. These bad actors prey on vulnerable customers, offer no consumer protections, do not ensure integrity or fair play, and generate no economic benefit for states or tribal nations.”

Status quo just fine for some

The approach by AGA is not without its critics — particularly among professional gamblers who find the legal, regulated market lacking on many fronts.

The letter comes just shy of next month’s fourth anniversary of the landmark U.S. Supreme Court ruling that invalidated the federal Professional and Amateur Sports Protection Act of 1992 (PASPA), thus allowing for any state to permit legal sports betting. Since that ruling, 33 states and Washington, D.C., have authorized such gambling, but it remains illegal in the three most populous ones in California, Florida, and Texas.

In his letter, Miller writes that “these illegal sites … enjoy competitive advantages that allow them to offer better odds and promotions and ignore any commitment to responsible gaming because they do not pay state and federal taxes or have comparable regulatory compliance costs and obligations.”

According to the AGA, consumers are “confused” because while 74% of sports bettors say it is important to only bet with legal providers, 52% said they continue to utilize illegal bookmakers. In fact, 63% of gamblers in the AGA poll said they were surprised to learn they were betting with illegal sportsbooks.

Many of the largest U.S. media outlets have routinely referred to offshore betting lines in articles, both before and since the PASPA ruling in 2018, and Bovada accounted for 50% of all sportsbook internet searches last year, according to the AGA.

Other concerns cited by AGA

Only a handful of states — including New Jersey, Pennsylvania, and Michigan — have passed laws that allow for legal online casino operations in addition to sports betting. On this front, Miller wrote that illegal operators also aggressively market to U.S. consumers unaware of which sites are legal.

A growing number of companies, meanwhile, are said by the AGA to manufacture machines that “mimic regulated gambling devices using drums or reels with insignia or other symbols that players ‘spin’ to win prizes, including money.”

Again, Miller wrote, consumers typically are unaware that such devices are illegal.

“These machines often are tied to criminal activity — including money laundering, drug trafficking, violent crime, and more,” he said.

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