State gambling regulators ask feds for help combating illegal offshore betting
“Offshore operators who offer their products into these highly-regulated state jurisdictions are doing so in contravention of not only state laws, but federal law,” reads the letter. (Getty Images)
Top gambling regulators in seven states, including Nevada Gaming Control Board Chairman Kirk Hendrick, are urging U.S. Attorney General Merrick Garland to help combat illegal offshore betting.
“Offshore operators who offer their products into these highly-regulated state jurisdictions are doing so in contravention of not only state laws, but federal law,” says a letter to Garland dated April 28, signed by top regulators in New Jersey, Michigan, Illinois, Colorado, Mississippi, and Louisiana, in addition to Nevada.
The regulators point out illegal gambling operations don’t invest in responsible gambling programs, and don’t pay taxes. They don’t protect minors via age verification, take steps to prevent money-laundering, or guarantee fair payouts.
Americans bet an estimated $511 billion each year with illegal and unregulated sportsbooks, iGaming websites and other games, at the expense of taxpayers and the legal gambling industry, according to a report from the American Gaming Association, which also wants the U.S. Department of Justice to crack down.
“We strongly encourage the Department of Justice to prioritize investigation and prosecution of these offshore sites, and stand ready to provide any assistance that we can as state gaming regulators,” says the letter, “The Justice Department’s leadership is essential to help protect Americans from these illegal operations and ensure the immense amount of money generated by these bad actors is not used to bankroll other illegal activities such as human trafficking and the drug trade.”
The regulators say they are doing what they can to preserve the integrity of legal gambling, but say “the many significant threats posed by offshore illegal gambling cannot be addressed by states alone and, therefore, require heightened federal attention and engagement.”
Almost three dozen states have legal forms of sports betting available to anyone with a smartphone. Yet ads for offshore sports betting and casino sites, both off limits to bettors in the U.S., are ubiquitous, and appear regularly in publications and on websites.
Last year, the Las Vegas Review-Journal, owned by Miriam Adelson, widow of former LV Sands gaming licensee Sheldon Adelson, defended “sponsored content” promoting the “6 Best Gambling Sites for real Money in 2023,” all of which are offshore and illegal for bettors in the U.S.
“We’ve reached out to the RJ, not on this particular ad, but in the past,” Chris Cylke of the American Gaming Association said in November 2022. The AGA routinely notifies advertisers that they are aiding and abetting illegal gambling. “The reaction has been fairly positive and it’s been kind of an educational thing. … They’ve all kind of come around. I’m surprised that the Review-Journal did it.”
LV Sands is seeking gaming licenses in New York and Texas. Officials in those states did not immediately respond to questions about whether the ads run by LV Sands’ sister company, the Review-Journal, would be of concern to regulators.
Hendrick, chair of the Nevada GCB, declined to specifically say whether state regulators raised concerns about the ads when LV Sands held a license, or whether it had the jurisdiction to do so.
“The Board works closely with law enforcement agencies both inside and outside Nevada to prevent any illegal activity within the board’s jurisdiction,” Hendrick said via email earlier this year.
“It would not be appropriate for me to opine on any specific matters that may or may not come before the NGCB or Nevada Gaming Commission,” Hendrick said via email on Thursday.
Note: This story was updated with additional comment from GCB Chairman Hendrick.
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