The recent round of warnings from state sports betting regulators to Bovada could be only an opening salvo fired by onshore watchdogs toward offshore gambling sites.
Curaçao-based Bovada moved last week to restrict customers from Colorado and Michigan after the offshore sports betting operator received cease-and-desist letters from regulators in those states.
Seven states are now officially restricted by Bovada: Nevada, New Jersey, New York, Maryland, Delaware, Michigan, and Colorado.
Some news: Bovada says it is done in Michigan AND Colorado, where state regulators also sent a cease-and-desist letter to the offshore sportsbook:https://t.co/1Cmqnd5t7O @Covers
— Geoff Zochodne (@GeoffZochodne) June 20, 2024
But Bovada was also recently hit with a cease-and-desist letter from Connecticut’s Department of Consumer Protection for similar reasons, namely, allegations of offering unlicensed online gambling in the New England state.
The operator could eventually withdraw from Connecticut, which has just three licensed online gambling operators.
Bovada could face similar requests to shut down in additional jurisdictions. Moreover, Bovada’s fellow offshore sportsbook operators may find themselves grappling with cease-and-desist letters of their own, as state regulators are making it clear they won’t let an ocean or thousands of miles of space keep them from trying to stop illegal gaming activity in their backyards.
“We don’t discuss the status of ongoing investigations or confirm whether we have open investigations on specific entities,” said Lisa Keith, public information officer for the Michigan Gaming Control Board (MGCB), in an email to Covers on Tuesday. “However, you can expect to see more action from the MGCB regarding illegal internet gaming.”
Bovada was not the first online gambling operator to receive a cease-and-desist letter from Connecticut’s Department of Consumer Protection. It likely won’t be the last either.
“The state of Connecticut has three licensed online gaming operators – FanDuel, DraftKings and Fanatics,” said Kaitlyn Krasselt, director of communications for the Department of Consumer Protection, in an email. “There is not an opportunity for more operators to become licensed in our state unless one of those three departs. Any business conducting unlicensed gaming activity in Connecticut could result in a cease-and-desist letter sent to the company operating illegally.”
The Ohio Casino Control Commission is another state regulator that has not shied away from hitting companies with cease-and-desist letters, particularly those who strayed a little too close to sports betting with paid fantasy contests.
While the Buckeye State regulator has yet to confirm they’ve sent any correspondence to Bovada or other offshore operators recently, it’s not out of the question given the commission’s previous proactivity.
“Whether land-based or online, illegal gaming activities are a pain point for many regulators,” said Jessica Franks, the Ohio Casino Control Commission’s director of communications, in an email. “The Commission will use the civil and criminal tools at our disposal whenever it discovers gaming products being offered illegally in the state. We have shut down dozens of illegal casinos masquerading as skill games businesses, seizing more than 7,000 illegal slot machines, and taken action when fantasy contest operators seek to blur the line between fantasy sports and sports gaming.”
So the potential is there for onshore sports betting regulators to send more cease-and-desist letters offshore. It’s also possible some of those letters are addressed to brands other than Bovada.
Where’s your feds at?
American Gaming Association president Bill Miller wrote a letter in April 2022 to U.S. Attorney General Merrick Garland that warned "a vast illegal sports betting market continues to exist through offshore websites."
Those sites, Miller added, “have established well-known brands – such as Bovada, MyBookie and BetOnline – that operate with a high degree of visibility and are readily accessible to every American with a smart phone or Internet connection.”
MyBookie and BetOnline have thus far dodged the recent wrath of state regulators, at least publicly. That respite may not last forever, though.
The AGA, meanwhile, is still trying to enlist the help of the federal government in cracking down on offshore gambling sites. The industry group is also hoping more states follow the lead of Colorado, Connecticut, and Michigan.
“Successful enforcement actions against Bovada by Michigan and Colorado are proof that states have tools to fight back against offshore operators and should serve as blueprints for other states to follow,” said Chris Cylke, the AGA’s senior vice president of government relations, in a recent statement. “But states should not have to take on this battle alone – the [U.S. Department of Justice] must also use its powers to aid the fight against illegal gambling, which Congress has clearly identified as a department priority.”
