Gambling Regulators in Several States Have Urged the Federal Government to Crack Down on Offshore Betting Sites

May 11, 2023 | Online Gambling

Michigan, Colorado, Illinois, Louisiana, Mississippi, and New Jersey Urging DOJ Action

USA (May 8, 2023) — Gambling regulators in several states, including Nevada, are trying to urge the federal government to go after online betting sites based overseas.

According to the Las Vegas Review-Journal, Nevada Gaming Control Board Chairman Kirk Hendrick sent a letter last week to U.S. Attorney General Merrick Garland.

“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,” Hendrick said.

Late last year, the American Gaming Association issued a report on the amount of money Americans spend each year at offshore sports betting sites. The AGA’s report estimated that Americans wager $63.8 billion with illegal bookies and offshore sites at the cost of $3.8 billion in gaming revenue and $700 million in state taxes.

Americans placed around $100 billion in legal sports bets in 2022, so o illegal sportsbook operators capture nearly 40 percent of the U.S. sports betting market.

“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,” Hendrick added.

“[M]any 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 stand ready to provide any assistance that we can as state gaming regulators.”

Sports betting is legal in 36 states and the District of Columbia.

The AGA report also included information on online casinos. Americans wager an estimated $337.9 billion annually with offshore online casinos, with a loss of $3.9 billion in state tax revenue. With $13.5 billion in estimated revenue, the offshore market in the U.S. is nearly three times the size of the legal U.S. iGaming market, estimated to be $5 billion in 2022.

Online casinos are legal in just six states.

Article By: Joe Mattia

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