State regulators want federal action against unlawful offshore sites

In urging the federal government to take action against unlawful offshore internet gambling casinos, Nevada has joined six other states. Kirk Hendrick, the chairman of the Nevada Gaming Control Board, wrote to the U.S. Attorney General Merrick Garland last week to request more action against illegal gambling.

Leaders of six additional gaming regulatory organizations from Michigan, Colorado, Illinois, Louisiana, Mississippi, and New Jersey also signed Kendrick's letter from April 28, 2023. “As the primary regulators of the legal gaming industry in our seven states, we write today to urge the Department of Justice to prioritize combating illegal, offshore sportsbooks and online casinos,” the letter said.

Kendrick continued, “The dangers posed by these unlawful operations are well known, including a lack of investment in responsible gaming programs, loss of state tax revenue that funds important initiatives, no age verification requirements to protect minors, no controls to prevent money laundering, an absence of guarantees that customers will receive fair payouts and much more.”

In a report released in November 2022, the American Gaming Association estimated that the illegal and unregulated gaming market costs the legal and regulated markets in the United States an estimated $44 billion annually and prevents states from collecting an estimated $13 billion in tax revenue. When the report was released, AGA President Bill Miller said, “This is a fight we’re in for the long haul to protect consumers, support communities and defend the law-abiding members of our industry.”

Only New Jersey, Delaware, Pennsylvania, Michigan, and West Virginia allow for online casino gambling, while Nevada allows for online poker play. Some customers find the situation confusing because mobile sports betting through the internet is permitted in a number of other jurisdictions, including Nevada.

The following individuals signed the letter: Ronnie Johns, chairman of the Louisiana Gaming Control Board; Henry Williams, executive director of the Michigan Gaming Control Board; Marcus Fruchter, administrator of the Illinois Gaming Board; Dan Hartman, the former director of the Colorado Division of Gaming; Jay McDaniel, executive director of the Mississippi Gaming Commission, and David Rebuck, who is the director of the New Jersey Division of Gaming Enforcement.

The officials expressed their concern that money made from unlawful websites might be used to finance other illegal activities including the drug trade and human trafficking.

Among advantage players, there was skepticism of the reasons behind the letter. Some players felt that the gaming officials instead should be spending more of their time investigating casino cheating, abuse of patrons, and other daily issues. Blackjack advantage player Rebecca C, a resident of Marina del Rey, California and frequent Las Vegas visitor, commented on the practice of revoking comps after they have been earned as a frequent type of casino cheating that rarely interests the Nevada Gaming Control Board. “The offshore sites are a total non-issue. More needs to be done to truly protect patrons. Nevada falls flat when it comes to ever taking any real action against dishonest land-based casino managers.”

The letter concluded with, “We understand and appreciate the fact that the Department of Justice’s jurisdictional responsibilities are broad and, consequently, priorities vary over time. However, the many significant threats posed by offshore illegal gambling cannot be addressed by states alone and, therefore, require heightened federal attention and engagement. We strongly encourage the Department of Justice to prioritize investigation and prosecution of these offshore sites, and (we) stand ready to provide any assistance that we can as state gaming regulators.”

Source:

“State gaming regulators want federal crackdown on illegal sites” , Richard N. Velotta, lvrj.com, May 5, 2023.