FBI, AGA Stress Cooperation In Tackling Illegal Gambling

December 9, 2022
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A representative of the American Gaming Association reassured a group of U.S. gaming regulators on Thursday that the FBI and other federal and state law enforcement agencies are cooperating with the industry in their efforts to eliminate and prosecute illegal gambling operators.

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A representative of the American Gaming Association (AGA) reassured a group of U.S. gaming regulators on Thursday (December 8) that the FBI and other federal and state law enforcement agencies are cooperating with the industry in their efforts to eliminate and prosecute illegal gambling operators.

“We’ve had numerous conversations with the FBI, including having a number of agents in our [Washington, D.C.] offices to have in person meetings,” Tres York, the AGA's senior director of government relations, told a gathering of state regulators on Thursday (December 8) during a meeting of the Sports Betting Regulators Association in Las Vegas.

York noted that AGA president and CEO Bill Miller sent U.S Attorney General Merrick Garland a letter in April outlining the pervasive nature of illegal gambling and the threat these operators pose to consumers, state economies and the legal gaming industry.

The AGA has also engaged with the 50 state attorneys’ generals, state police and local authorities, he said.

Tina Griffin, director of the Washington State Gambling Commission, appreciated the AGA’s outreach but asked if these agencies had responded to any of their efforts.

“The U.S. Department of Justice responded to our letter, basically thanking us for the information and our conversations with the FBI have been very productive,” York said. “I think these types of investigations can be pretty labor intensive … when you are dealing with offshore [companies].”

“So we have attempted to give them any type of information that might help them start an investigation,” he added. “But the conversations have been productive … we are hoping to see action, prosecutions in the future.”

Erin Leifer, management and program analyst with the FBI’s Integrity in Sports and Gaming Program, agreed, saying the FBI works very closely with the AGA, but declined to offer any specifics on the action the agency is taking against illegal gambling operators.

“Obviously, we are not in a position to comment on ongoing investigations,” Leifer said. “What I can say are two things. One, we take the information we get and always turn it into something whether that be intelligence, a case or arrests that make the news.

“The second thing I’ll say is that there are a lot of challenges associated with these types of investigations. A lot of these are located outside of our jurisdiction. Additionally, there are a lot of challenges in building out the criminal networks that are associated with these groups.”

Leifer stressed that the problem of illegal gambling was on the FBI's “radar.”

York’s appearance Thursday before gaming regulators also gave him an opportunity to brief them about the AGA’s recent report that found Americans still spend an estimated $511bn annually gambling via unregulated sportsbooks, offshore websites and so-called skill-based gaming devices.

He highlighted that Americans spend more than $109bn annually with the more than 580,000 unregulated gaming machines nationwide. With the 870,000 regulated machines in casinos and slot routes, that means 40 percent of all gaming machines in the U.S. are unlicensed.

York told some 30 assembled regulators that the survey’s figures on grey-market machines do not include states where machines in locations other than casinos are legal, including Nebraska and slot-routes that operate in Nevada and Illinois.

Including Nebraska in the list of states with legal video gaming terminals (VGTs) caused Tom Sage, executive director of the Nebraska Racing and Gaming Commission, to question York on why the AGA believes these games are legal in Nebraska.

“I read the report several times and I’m not going to put you on the spot,” Sage said. “In your presentation, you mentioned in Nebraska the games being regulated. Do you know what your researchers call regulated?”

Sage said the machines are not really regulated in Nebraska because the level of oversight involves just a $250 tax stamp per machine for the year. He added that there are many issues with the machines in Nebraska.

York said he “didn’t have a good answer for what the definition was.”

The Sports Betting Regulators Association (SBRA) is a relatively new organization featuring about three-dozen regulators from states that have legalized wagering on sports since the U.S. Supreme Court overturned the Professional and Amateur Sports Protection Act (PASPA) in May 2018.

The SBRA held its second meeting on Thursday since July in conjunction with the National Council of Legislators from Gaming States (NCLGS) winter meeting at Resorts World Las Vegas.

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