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Ontario gambling regulators have issued a C$110,000 ($77,000) fine to an online operator for violations by contracted third-party marketing affiliates that offered cash inducements to open wagering accounts.
The Alcohol and Gaming Commission of Ontario (AGCO) announced the penalty on Wednesday (March 26) against BetMGM, the joint venture of MGM Resorts and Entain that is licensed to operate online sports betting, casino games and poker in the province.
Under AGCO regulations, registered iGaming operators are prohibited from offering gambling inducements, bonuses and credits as part of their public advertising and marketing activities.
“These standards exist to protect Ontarians from predatory advertising and promotional marketing practices in order to limit the risk of gambling-related harm,” the AGCO said in a statement.
In information made public Wednesday, the AGCO cited two separate incidents by BetMGM's third-party marketing partners Above the Street and Maple Leaf Marketing. BetMGM representatives in a separate incident also violated the agency’s regulations.
BetMGM acknowledged that its marketing affiliate Above the Street had engaged in prohibited inducement marketing on or about March 11, 2024. The firm opened 377 player accounts that resulted in C$127,180 in commissions from BetMGM.
Then on or about April 13, 2024, Maple Leaf Market engaged in prohibited inducements and marketing to induce on-site activations and acquire new players for BetMGM. The marketing firm’s activities resulted in 94 player sign-ups and about C$34,000 in commissions.
The AGCO also found that on or about January 13 and 14, 2024, “BetMGM representatives were alleged to have attended” the National Franchise Show, a major business trade show, and “were offering $100 in cash to new players for opening a new account and depositing $15”.
“Responsible gambling safeguards and the protection of Ontarians on registered gaming sites is among our key priorities,” said Karin Schnarr, the AGCO’s CEO and registrar.
“The AGCO monitors the activities of all registered operators and their third-party suppliers to ensure they are meeting our high standards, and we continue to take strong action to ensure they operate within the public interest.”
Specifically, BetMGM failed to comply with two provisions of the AGCO's Standards for Internet Gaming, which make operators themselves responsible for the actions of third parties with whom they contract for the “provision of any aspect of the operator’s business related to gaming in Ontario”.
Regulation 1.19 requires a third-party business to conduct themselves in “so far as they carry out activities on behalf of the operator as if they were bound by the same laws, regulations, and standards”.
BetMGM violated Regulation 2.05 that prohibits advertising and marketing materials from communicating gambling inducements, bonuses and credits, except on an operator’s gaming site and through direct advertising and marketing, after receiving active player consent.
The AGCO has a number of restrictions on how iGaming and sports betting are marketed within the province, with most aimed at protecting minors and limiting the risk of gambling-related harm.
Its prohibition on inducements or bonuses in advertising is unique in North America, although legislation to impose similar restrictions is currently being considered in Connecticut.
In August 2023, the AGCO finalized new rules prohibiting the use of active or retired athletes, as well as other celebrities, from appearing in advertisements for online sportsbook operators. Athletes are able to appear in ads “for the exclusive purpose of advocating for responsible gaming practices”.
