U.S. Gaming Industry Group Pushes for Federal Crackdown on Illegal Online Sportsbooks

On Thursday, the American Gaming Association announced its chief executive had penned a letter to U.S. Attorney General Merrick Garland that calls for a crackdown on "illegal online sportsbooks and casinos," as well as unregulated "skill game" machines.

Apr 14, 2022 • 18:14 ET • 2 min read
Offshore Sports Betting
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A major U.S. gambling industry group is asking the federal government to send a message about offshore sportsbooks that may be breaking the law — and it’s probably one those allegedly unauthorized operators won’t like hearing. 

The American Gaming Association announced on Thursday that its chief executive had penned a letter to U.S. Attorney General Merrick Garland that calls for a crackdown on "illegal online sportsbooks and casinos," as well as unregulated "skill game" machines.

“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,” AGA President and CEO Bill Miller wrote in the April 13 letter.

Hanging around

The AGA’s call comes as there is now a form of legal sports betting available in 30 states and the District of Columbia, giving Americans in those jurisdictions at least one option to make a lawful wager. However, even with those options, the industry group says "a vast illegal sports betting market" still exists via offshore websites that are accessible to Americans.  

Illegal sites may be able to offer better odds and promotions than legal online sportsbooks and could shrug off responsible-gaming obligations because they face no state or federal taxes and no U.S. regulation, the AGA boss claims.

AGA research also found that 74% of sports bettors consider it important to wager only with legal providers, but that 52% were still using illegal bookmakers. What's more, 63% later said they were surprised to discover they were betting via illicit sportsbooks. 

The AGA now wants the U.S. Justice Department to start going after illegal offshore operators, saying it is “the only law enforcement entity” that can credibly do so. More specifically, the industry group wants the department to keep educating consumers about what is and isn’t legal when it comes to gambling, but also to take a much more serious step. 

“While prosecutions and convictions may be difficult to secure, the AGA firmly believes that the Department can make a strong and meaningful statement by investigating and indicting the largest offshore operations that openly violate federal and state laws,” Miller wrote. “This action would provide much-needed clarity that these websites are criminal enterprises, which can help to deter the American public from visiting these sites and prompt businesses to take appropriate action to ensure they are not supporting them.”

Telegraphing punches

It’s not clear if the DOJ will heed the AGA’s call for a crackdown. Thursday’s news also prompted some pushback on Twitter from gamblers who see faults with the state of regulated sports betting in the U.S.

However, Miller telegraphed such a move could be coming back in February, during a state-of-the-industry speech that took aim at illegal gambling operations. He also tied the boom in advertising for legal sportsbooks to the efforts to draw customers away from illegal options, saying the marketing was helping to drive the shift towards regulated channels. 

“Illegal operators have been put on notice: their days as a scourge on our nation are numbered,” Miller said Thursday in a press release. “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.”

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