News In Brief: October 21-October 25, 2024

October 25, 2024
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More offshore fines in the Netherlands, Illinois to suspend wagers on injuries and Massachusetts to investigate leading operators over golf bets.
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Dutch Regulator Issues More Offshore Fines
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The Netherlands Gambling Authority (KSA) has fined one operator and ordered another to leave its market or face mounting penalties.

On Tuesday (October 22), the regulator told Winbet NV it faced fines of up to €840,000 if it did not stop accepting Dutch gamblers via its websites galaxyspins.com, winnercasino1.bet, superb1.bet and doctorspins.com.

The operator faces fines of €280,000 per week if it does not immediately block players from the Netherlands.

On Thursday (October 25), the KSA handed NetX Betting Limited a €675,000 fine for offering gambling without a permit. The operator was offering into the Netherlands via its pferdewetten.de and betbird.com sites, the regulator said.

“Dutch players need to be protected: that is why we are cracking down hard on illegal offers,” said Michel Groothuizen, chairman of the KSA board.

“We see that illegal providers often pay little attention to the player and do not adhere to a duty of care. 

“Here, for example, we saw the practice that players who are inactive for a long time after creating an account are given a 'fine' by the provider. If they do not play for a certain period of time, an amount of €5 per month is charged. 

“A player is then punished if he does not participate in the (illegal) games of chance offered. That of course goes beyond all bounds.”

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Illinois Suspends Objectionable NFL Wagers
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The Illinois Gaming Board (IGB) issued a temporary suspension Thursday (October 24) on National Football League (NFL) wagers that involve bets on injuries, player conduct, penalties, first play of the game, or a field goal or extra point try.

The temporary suspension also involves bets on first pass to be competed, officiating assignments, roster or personnel decisions, and any other wager that is pre-determined or 100 percent determinable by one person in one play. 

“The NFL seeks to prohibit objectionable bets for several reasons,” Jonathan Nabavi, vice president of public policy and government affairs, wrote in a letter to Illinois regulators.

“Inherently, objectionable bets represent markets or bets that are inherently derogatory, designed to be inflammatory, or otherwise based on subject matter against public policy,” Nabavi wrote. “Those market often are not directly related to game play and can have a negative impact on the consumer and player involved.”

Nabavi added that the other categories of objectionable bets represents “market or bets that pose the greatest risk, or perceived risk, to game integrity.” He said prohibiting these wagers would protect NFL “inside information.”

The issue is expected to be discussed at the IGB’s December 12 meeting.

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Massachusetts To Investigate FanDuel, BetMGM Over Golf Bets
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The Massachusetts Gaming Commission (MGC) on Thursday (October 24) referred two non-compliance complaints against BetMGM and FanDuel to its Investigations and Enforcement Bureau (IEB) for further investigation.

Diandra Franks, enforcement counsel for the IEB, said BetMGM and FanDuel had offered and accepted wagers on LPGA (Ladies Professional Golf Association) tour events prior to the commission approving the events for wagering. 

Between March 20, 2023 and May 14, 2024, BetMGM accepted 1,934 wagers with a total handle of $1,642.46, while FanDuel accepted 7,155 wagers between March 26, 2023 and June 6, 2024, for a total handle of $78,254.56.

Franks said the non-compliance was discovered as a result of an email sent on May 14 from the MGC’s sports wagering division to both companies. The commission approved wagering on LPGA events on June 6. 

“I’m curious to how it went undetected for so long, which to me would bear on any sort of consequences for the allegation of noncompliance,” said commissioner Eileen O’Brien. 

The MGC voted unanimously to send both cases to the IEB to conduct an investigation and bring back their recommendations, which the commission can accept or schedule an adjudicatory hearing.

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Nevada Gaming Commission Postpones Meeting
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The Nevada Gaming Commission postponed its meeting scheduled for Thursday (October 24) after an internal error resulted in the meeting’s agenda failing to be posted in accordance with the state’s Open Meetings Law. 

The commission’s October meeting was rescheduled for November 4. 

In addition to licensing hearings, commissioners were scheduled to consider a pending settlement reached between the Nevada Gaming Control Board (NGCB) and Grand Sierra Resort in Reno that could result in a $250,000 fine.

In the complaint, the NGCB alleged that security guards at the casino prevented board enforcement agents from accessing a theater in a routine check at the property on December 19, 2023. The complaint found NGCB agents were also prevented from entering Grand Sierra in January 2021.

The control board issued a violation letter over the initial incident in February 2021, according to the complaint. 

Nevada’s Open Meeting Law requires public entities to post their agendas at least three days prior to the meeting.

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FinCEN Fines California Cardroom $900,000
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A 22-table cardroom in southern California has agreed to a $900,000 civil penalty issued by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) for violations of the Bank Secrecy Act (BSA).

As part of its resolution with FinCEN, Lake Elsinore Casino admitted to violating BSA regulations, including failing to implement and maintain an effective anti-money laundering (AML) program, and failing to file currency transaction reports (CTRs) and suspicious activity reports (SARs).

According to a consent order released Wednesday (October 23), Lake Elsinore’s AML violations continued for more than four and a half years and were the result of decisions made by the card club’s management.

“Lake Elsinore operated for years without the most basic AML controls, putting its customers and the U.S. financial system at risk and denying law enforcement information on suspicious activity,” said FinCEN director Andrea Gacki in a statement. 

Gacki also said the action was a reminder that all financial institutions must comply with their obligations under the BSA and FinCEN’s regulations. Lake Elsinore Casino is located in a city some 75 miles southeast of downtown Los Angeles. 

The consent order was the first resolution of the charges alongside those of the California Department of Justice Bureau of Gambling Control, according to FinCEN.

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Tennessee Sanctions Bovada Over Illegal Betting
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The Tennessee Sports Wagering Council (SWC) has imposed a $50,000 fine against Bovada after the offshore sportsbook operator failed to comply with a cease-and-desist order delivered to its registered address in Curaçao.

Regulatory officials were subsequently able to place wagers with Bovada from within Tennessee on three separate occasions, resulting in the accumulation of $50,000 in applicable penalties, the SWC said in a statement published on Wednesday (October 23).

The Tennessee regulator also said it was “working closely with its network of law enforcement at the state and federal level to eradicate illegal sportsbooks such as Bovada and others”.

Bovada has recently withdrawn from around a dozen U.S. states, most recently Massachusetts, after receiving cease-and-desist notices. Tennessee is the first state to announce a penalty against the operator for non-compliance with such an order.

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Live! Casino Philadelphia Fined $50,000
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The Pennsylvania Gaming Control Board (PGCB) approved a consent agreement and $50,000 fine for Live! Casino and Hotel in Philadelphia on Wednesday (October 23) for allowing four individuals on the board’s self-exclusion list to gamble in the casino. 

According to state gaming regulations, a casino must identify self-excluded patrons and refuse to allow them to gamble, as well as other gaming-related activities such as the cashing of checks or cash advances. 

John Crohe, senior enforcement counsel for the PGCB, said among the four incidents was an individual identified as “HE” who was able to gamble for 55 minutes between December 15 and December 16, 2021, buying in for a total of $36,900 at an undisclosed game.

Crohe said the incident was discovered during an internal report process following the creation of a duplicate players club account. While on the exclusion list, Crohe said, “HE” received a players club card and comps in the form of $3,000 in matched play coupons and tickets to a Philadelphia Eagles football game. 

Tom Diehl, vice president of legal affairs for Live! Casino in Philadelphia, confirmed the four incidents but told board members that there was also a “list of remedial actions that we have taken since these events occurred in 2021 and 2022.”

Diehl said the casino had also changed the system used for signing up new players to club accounts and implemented a new duplicate report that helps the casino identify any inadvertent duplicate accounts.

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Sportradar Acquires XLMedia’s North American Assets
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Sportradar has agreed to acquire XLMedia’s North American business for up to $30m in cash.

XLMedia, a London-based digital media company, said Monday (October 21) that following the deal’s completion, which is expected shortly after the company’s shareholder meeting on November 7, it will become a cash shell entity focused on distributing the proceeds from the North America and previously announced Europe and Cana asset disposals.

The deals generated $72.5m in cash before costs and liabilities. 

“While it was confident that the U.S. market would provide long term success for a larger organization, the board believes XLMedia’s current scale on a standalone basis could impact its ability to compete in the evolving U.S. market,” the company said in a statement. 

The company’s North America business generated $27.5m in revenue for 2023 and $5.5m in estimated adjusted earnings before interest, taxes, depreciation and amortization (EBITDA). XLMedia will receive $20m in cash and an extra $10m payable in April subject to performance. 

“In an ongoing commitment to maximize shareholder value, following the Europe disposal, the board is pleased to have reached an agreement to sell the North America business to Sportradar pending shareholder approval,” said Marcus Rich, chairman of XLMedia.

Rich said the company anticipates an initial distribution from the net proceeds to shareholders before the end 2024.

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Montenegro Hails Tax Reforms
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Following a change in Montenegro’s gambling tax rates, the country’s budget revenues from gambling rose by some 81.7 percent year-on-year to reach more than €24.2m for the period of January to September 2024, the Administration for Games of Chance said in a statement. 

The agency said that the improved revenues confirm the logic behind the amendments introduced to the Montenegrin law on games of chance from January 1.

“Please note that, owing the amendments to the law on games of chance from January 1, 2024, the application of the taxation of the variable part of the concession fee for the organisation of games of chance via the Internet and other telecommunication means has been initiated, and total revenues in this segment alone amount to €8,632,760.82, as of September 2024,” according to the statement.

During the same period, the Montenegrin state’s tax revenues from casinos rose by a robust 107.9 percent, reaching close to €3.87m. 

In addition to this, between January and September the state secured tax revenues of around €7.12m from bookmakers. This result represented an increase of around 5.9 percent compared with the same period a year earlier.

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Brazil Supreme Court Set To Rule On State Lottery Restrictions
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Brazil’s Federal Supreme Court (STF) is likely to strike down specific provisions of a December 2023 online betting law that aim to restrict state-authorised betting or lottery offerings, based on a non-binding opinion published on Friday (October 18).

The governors of São Paulo, Rio de Janeiro and five other states filed a legal challenge in May to contest two provisions that prevent operators of fixed-odds betting or other lottery games from obtaining a licence or concession from more than one state, or from advertising beyond the borders of the state where they are licensed.

In a 26-page opinion, presiding judge Luiz Fux said both provisions violated were unconstitutional, in part because they improperly restrict the ability of states to compete with the federal government in the operation of lottery games.

The full bench of 11 justices did not get the opportunity on Friday to vote on whether to adopt Fux’s opinion, as one judge requested a postponement. A final ruling is now expected on October 25, according to the STF's website.

The case is one of several pending with Brazil’s top court related to online betting.

A leading Brazilian retail association is separately challenging the entirety of Law 14.790 of December 2023, while the state of Rio de Janeiro and the federal government are contesting Rio's authority to authorise operators to accept bets beyond the state's borders.

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More offshore fines in the Netherlands, Illinois to suspend wagers on injuries and Massachusetts to investigate leading operators over golf bets.

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