America has an illegal gambling problem.
While legal sports betting has been adopted in 37 jurisdictions, with Vermont joining the fray on Jan. 11, there are still a number of states that do not allow sports betting. And as a result, residents that reside in those states have been seeking alternative measures to place sports bets.
The matter was discussed this week at the National Council of Legislators from Gaming States winter meeting in Fort Lauderdale, Florida during a general session on illegal gambling in the retail and online markets.
Despite the repeal of Professional and Amateur Sports Protection Act (PASPA) and introduction of legal sports betting in many U.S. states, illegal offshore gambling sites remain available and as accessible as ever. They’re often the first place bettors turn to in states where legislation has not yet passed.
Though retail and online betting in America surpassed a $100 billion handle for a calendar year in 2023, there were 201 million visits to illegal betting sites during the first three months of the NFL season alone, with web traffic originating from within the U.S. Especially during the height of the pro and college football season, bettors are finding other avenues to get bets down.
“Anybody who wanted to bet this past weekend, they did, even if they were in Georgia,” said Lindsay Slader, senior vice president of compliance at GeoComply, in reference to the College Football Playoff semifinal games which took place just days prior.
“Just because there’s regulated gambling in the United States of America, doesn’t mean that it isn’t happening. There’s still plenty of options.”
The most popular offshore betting site in the U.S. was Bovada.lv, which led the way with more than 35 million visits in September, a shade more than 40 million in October, and another 40 million in November, according to Slader. MyBookie and BetOnline were other popular options, drawing north of 50 million and 20 million visits, respectively, during the first three months of the NFL season.
“If you look at the NFL season that started in September, almost 202 million visits to these sites gives you a little sense of how popular they still are for Americans,” said Slader. “You’ve got sports betting legal in 30-something states and a handful that have online casino or poker, but there’s still a whole lot of folks that don’t have those regulated options yet.”
A question was posed to the panel during the session as to why Bovada is able to operate freely in many states, openly advertise on traditional and digital marketing channels, and their app can even be downloaded from app stores.
“I know the American Gaming Association has had discussions about how hard would it be for Google to be checking whether or not the company that wants to advertise has a license somewhere in America to operate,” said Slader. “That’s a commitment that I think advertisers need to make all over our industry to move in the right direction.”
Crossing state lines
Bettors in states that haven’t regulated sports betting are also attempting to access regulated sites from neighboring states. GeoComply locates users of regulated online sites and found there were 1.5 million attempts to access regulated sites in Georgia since the kickoff of the NFL season, and a staggering 1.7 million attempts in Nebraska.
“Which is a significantly large number for the population in Nebraska,” said Slader. “I have no idea what’s going on there, but definitely a lot of folks driving to Omaha to place those bets.”
Oklahoma saw more than 380,000 attempts from 400,000 different users. It's similar to the data seen in Canada, where customers in Quebec attempt to access the Ontario market.
That’s millions of potential visits and millions in revenue that the regulated sports betting industry is missing out on.
And there’s little deterring customers from seeking out these other options.
“You can look up, ‘What site can I play in Oklahoma? Is it legal to partake in sports betting?’ and the resounding answer that you can get on all kinds of sites is, ‘Yes, absolutely. You won’t break any laws. This is 100% legal,’” said Slader.
“Obviously this is incorrect information, but you can do the same kind of search for any state that doesn’t have regulated gaming and come up with similar results. So I think for the average consumer, it is fairly confusing and with that also the confusion around, ‘Am I protected? Is my account vulnerable.’”
The proliferation of illegal gambling is just another matter states and gaming commissions are grappling with as they try to keep up with the ever-evolving betting industry.
