PlayUp says it has temporarily paused its legal sports betting operation in New Jersey following a few failed financial transactions and after Garden State regulators blocked the company from taking additional wagers.
"In our relentless pursuit of enhancing and improving our services, the difficult decision to pause our operations temporarily has been made," PlayUp said on its Garden State platform on Thursday.
The Australia-based operator of online sports betting sites says it will no longer accept new deposits and wagers on the current version of its New Jersey platform and that any outstanding action will be honored. The company added that it is "working swiftly" to get customers back to betting.
"During this time you will be able to access your account and withdraw funds, should you wish to do so," PlayUp's New Jersey sports betting site said. "The reason for this change is our strong commitment to transforming our product offering and streamlining our services into an unparalleled sports betting experience."
Another side to the story
However, while PlayUp is citing upgrades to its site, the New Jersey Division of Gaming Enforcement (DGE) told Covers in an email that it issued an order letter on Wednesday "revoking the transactional waivers that had allowed PlayUp to conduct sports wagering" in the state.
The letter was addressed to Daniel Simic, the chief executive officer of PlayUp. In it, DGE Director David Rebuck says the division requested certain financial information related to PlayUp's New Jersey operations starting in late June, but that only some of the requested information was received by a mid-July deadline and has not been provided since.
Furthermore, Rebuck said the DGE was aware PlayUp "has several other issues related to non-compliance" with New Jersey law and regulations. Those issues include outstanding invoices owed to the division, a significant reduction in employee headcount in the state, and a "potential fraud charge" PlayUp claims to be investigating for a patron that requested a withdrawal in March but may still not be complete.
"Staff that filled other integral roles including Chief Operations Officer, head of product, head of sportsbook, and head of compliance are also no longer employed by PlayUp," the letter states.
The "continued non-compliance" with state law, Rebuck wrote, "demonstrate that [PlayUp] is currently unable to offer real money sports wagering to New Jersey customers at the standard required by Division statutes and regulations."
What now?
Due to the above, the DGE said it was revoking the waivers and that PlayUp was not permitted to conduct any new iGaming or online sports betting business in the state.
That said, the DGE said it will require PlayUp to process existing wagers and withdrawals and that it will not consider "any unilateral void" of any pending action. PlayUp could reapply for another waiver in the future but would have to resubmit its entire gaming platform to the DGE for testing, among other things.
"The Division reserves the right to bring future disciplinary action against PlayUp, as well as its associated entity and individual qualifiers, for any violation of the Casino Control Act, Sports Wagering Act, or Division regulations based upon the facts currently presented or arising from subsequent investigations," Rebuck wrote in the letter, which was dated July 19.
Simic did not respond to emails from Covers regarding PlayUp's New Jersey operations or the DGE's letter before this article was published.
"Patrons will be able to access their funds and can withdraw them from the site," the DGE added in its email. "Additionally, PlayUp is obligated to pay out any pending wagers, while no new wagers can be accepted. We encourage patrons to contact DGE at info@njdge.org if they have any concerns or require further assistance."
Failed deals
PlayUp’s site in Colorado, the only other state in which it is live, apparently remained operational and taking bets as of Thursday afternoon. Despite that and PlayUp’s assurances to customers, the bookmaker has had some tricky financial situations of late.
While PlayUp and a publicly-traded acquisition company announced last September that they had entered into an agreement that would lead to PlayUp listing its shares on the NASDAQ stock exchange, those plans fell through.
The reasons given were delays in obtaining audited financial statements and other materials from PlayUp, "as well as market conditions that have made it difficult to obtain financing necessary to consummate the transactions," IG Acquisition Corp. said.
Other headaches
That failure followed another aborted deal with now-bankrupt crypto company FTX. PlayUp then said in April that it was pulling its bid for an Ohio sports betting license after striking a settlement with regulators there following allegations of illegal gambling activity.
PlayUp has since begun looking for a cash injection. The Australian Financial Review reported recently that the bookmaker was attempting a $10-million capital raise following its missed attempt at a U.S. stock listing. It is also near to selling its U.S. business altogether, according to Legal Sports Report.
