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Michigan Considers Targeting Bovada Suppliers, More Offshore Gaming Sites

June 10, 2024
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While waiting for Bovada鈥檚 response to an order to cut off access to its website by Michigan residents, state gaming regulators insist the company will not be the last offshore casino and sports-betting site they target for illegally operating in the state.

While waiting for Bovada鈥檚 response to an order to cut off access to its website by Michigan residents, state gaming regulators insist the company will not be the last offshore casino and sports-betting site they target for illegally operating in the state.

The regulatory crackdown on illegal gambling operators is being closely followed by several other states from Ohio to California.

The Michigan Gaming Control Board (MGCB) on May 29 issued a cease-and-desist order聽to Cura莽ao-based Harp Media B.V., which operates Bovada.com and Bovada.lv.

Regulators said by accepting wagers from Michigan residents, Bovada is in violation of the state鈥檚 Internet Gaming Act, the Michigan Gaming Control and Revenue Act, and the Michigan Penal Code.

The MGCB has given Harp Media 14 days to take steps to prevent Michigan residents from gambling on Bovada鈥檚 websites before further legal action is taken.

鈥淚 have not heard from them yet,鈥 Kurt Steinkamp, chief of staff with the MGCB, told 麻豆视频社区 GamblingCompliance on Thursday (June 6). 鈥淭he way the letter is written, it鈥檚 14 days from receipt. So, if they reach out to us today and say we got it, then the clock will start.鈥

Steinkamp reiterated the MGCB's position that Michigan regulators may pursue further legal action if they do not receive a reply by the deadline.

He declined to discuss details of the Bovada investigation beyond saying 鈥渋t will drive the legal strategy鈥 of the MGCB.

鈥淚 can鈥檛 reveal too much there but what I will say is that Bovada, like any other company, had to have businesses in the [United] States that provide services to them,鈥 Steinkamp said. 鈥淲hether it鈥檚 affiliate marketing, advertising, [or] payment processing.鈥

Those same companies, he said, are operating illegally in a legally regulated market.

鈥淎ll of those companies know this is our position on it and if those companies continue to engage in a business relationship with Bovada in the event that Bovada does not comply with the cease-and-desist letter, that also puts those businesses at risk.鈥

鈥淭hey risk not being able to operate in a very large gaming market in Michigan,鈥 Steinkamp added.

Steinkamp did not identify any specific suppliers but said there are some companies already on the MGCB's radar and there should be 鈥渕ore about that 鈥 as we move forward.鈥

In terms of monitoring offshore gambling sites operating in Michigan, Steinkamp said the industry should expect more cease-and-desist letters to be sent to those companies. Under the state鈥檚 gaming law, the MGCB was given the authority to investigate illegal gambling.

鈥淲e take that responsibility very seriously,鈥 he said. 鈥淲e are continuing to address the issue that is out there and, of course, Bovada is a big one but there are many other companies operating in the space. Obviously, those are on our radar.鈥

The MGCB's action against Bovada was the most prominent action to be taken by a state regulator against an offshore gambling operator in recent years, with states generally more limited compared with the U.S. federal government in their powers to pursue actions against companies that are based overseas.聽

Several states are now watching how the MGCB's attempt to ban Bovada from operating in Michigan unfolds.

鈥淭he commission is monitoring how the situation with Bovada develops,鈥 said Jessica Franks, a spokeswoman with the Ohio Casino Control Commission. 鈥淲e are in regular communication with regulators in Michigan and other jurisdictions on a variety of topics.鈥

Franks told 麻豆视频社区 that whether land-based or online, illegal gaming activities are a pain point for many state gaming regulators.聽

鈥淭he commission will use the civil and criminal tools at our disposal whenever it discovers gaming products being offered illegally in the state,鈥 she added. 鈥淲e have shut down dozens of illegal casinos masquerading as skill games businesses, seizing more than 7,000 illegal slot machines, and taken action when fantasy contest operators seek to blur the line between fantasy sports and sports gaming.鈥

Doug Harbach, a spokesman for the Pennsylvania Gaming Control Board (PGCB), said the board was aware of the actions taken by Michigan regulators and has concerns about illegal gambling in all forms.

鈥淓ach gaming state operates under a separate set of laws, so what one regulatory body does, does not necessarily translate to the same actions for another regulatory body such as in Pennsylvania,鈥 Harbach said. 鈥淲ith that in mind, we are monitoring the situation and will take all appropriate action within our authority to combat illegal gambling.鈥

Harbach said since Bovada 鈥渋s an unlicensed and unregulated operator, we do not have information on who and how many in Pennsylvania may be placing bets on this site.鈥

Representatives from the California Gambling Control Commission, Massachusetts Gaming Commission and Arizona Department of Gaming similarly told 麻豆视频社区 they were aware of the recent action taken by regulators in Michigan.

The prominent offshore sportsbook and online casino operates in most U.S. states, including Michigan, but is unavailable to residents of Nevada, New Jersey, New York, Maryland, and Delaware, which were all either early adopters of regulated internet gaming or have been the location of federal prosecutions against offshore gambling.

鈥淭he department is aware of the letter sent by the Michigan Gaming Control Board to Bovada and is currently looking into the issue,鈥 Dayne O鈥橞rien, spokesman with the Arizona Department of Gaming, told 麻豆视频社区.

When asked if the MGCB was setting a precedent for other states to follow with its crackdown on illegal gaming operators, Steinkamp declined to comment as a lot of other states are taking action, but may not be getting as much coverage as regulators in Michigan are getting.

鈥淚 do feel there is traction on some of these issues that is picking up and I would expect that to grow,鈥 Steinkamp said. 鈥淚t is definitely not something that Michigan can take on, on its own. It is something we have to work with other states on.鈥

Steinkamp told 麻豆视频社区 that state regulators and licensed operators have been incredibly supportive of the MGCB's enforcement efforts. He added that the MGCB also has a good relationship with the U.S. Department of Justice.聽

鈥淲e do stay in touch with them on things that we have going on,鈥 Steinkamp said. 鈥淏ut they are going to do what they are going to do. I hope they take action on a federal level, and I believe that would be very effective.鈥

鈥淲e shouldn鈥檛 sit on the sidelines and wait for that action. The states do have power and we should be taking action to do what we can to address this issue as well,鈥 he added.聽


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