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The United States commercial gaming market achieved unprecedented revenue in 2022, surpassing the previous record of $53 billion set in 2021. Totaling $60.4 billion nationwide, this remarkable feat highlights the industry’s substantial growth.
However, the country still witnessed illegal gambling surpassing the staggering sum of half a trillion dollars in the previous year.
The American Gaming Association is placing a continued emphasis on Michigan, aiming to significantly reduce illegal gambling by 2025.
How much was bet illegally in 2022?
The AGA reported that in 2022, an estimated $510 billion was unlawfully bet in the United States.
Unregulated or unlicensed machines, illicit bookmakers, and offshore gambling and sports betting websites can be categorized as forms of illegal gambling.
Approximately $44.2 billion in gaming revenue and $13.3 billion in tax revenue are lost due to the $510 billion worth of illegal gambling.
“The existence of a half a trillion-dollar illegal marketplace, competing with the legal industry, is something that I believe no other industry in America would accept,” stated AGA CEO and President Bill Miller. “The illegal market poses the greatest threat to our industry.”
Michigan illegal gambling crackdown highlights from 2022
In 2022, the Michigan Gaming Control Board prioritized their efforts to combat illegal gambling.
In collaboration with the Michigan Liquor Control Commission and state law enforcement, the MGCB conducted investigations that resulted in the seizure of 373 illicit gaming machines. Additionally, these efforts led to the prosecution and conviction of 17 individuals within the past year.
This month, Michigan Gaming was informed by MGCB Executive Director Henry Williams that they intend to persist in combating illegal gambling in Michigan, working alongside the Michigan Department of Attorney General and other law enforcement agencies throughout the state.
In the beginning of this month, charges connected to illicit gambling from 2018 were met with a plea of no contest by a former Flint police chief.
Why illegal gambling impacts you?
There are several reasons why consumers in Michigan are concerned about illegal gambling.
The unregulated “skill machines” found in bars or party stores across the state are not subject to any rules or regulations for individuals. In comparison to legal casino slot machines, these machines tend to have higher win percentages for the operators.
The operators are not bound by the laws of the state and the MGCB, as this unregulated machine does not provide consumers with a means to resolve disputes through Michigan’s governing bodies.
Consumers can utilize the fact sheet provided by the MGCB to effectively recognize unregulated gaming machines.
Williams expressed concern regarding the increasing presence of unregulated gaming machines in bars, restaurants, and party stores. These machines lack the necessary measures for consumer protection that legal and regulated gaming provides, and furthermore, they lack any safeguards to prevent underage gambling.
Illegal gambling has an adverse effect on the state’s tax revenue when viewed on a broader level. Gambling operators who operate without regulation or licensing do not contribute any revenue to the state.
State and local entities collected over $679 million in tax revenue from retail and online gambling in Michigan in 2022.
The tax revenue plays a vital role in supporting various essential services throughout the state, including schools, first responders, and other important funds.
If you come across any suspicious or unlawful gambling activities, the MGCB strongly urges residents of Michigan to report them. You can conveniently do so by dialing their 24-hour anonymous tip line at (888) 314-2682.
AGA working with legislators
The AGA is making efforts at a national level to enhance its strategies in order to combat illegal gambling.
Miller stated that they are persisting in the battle against the illicit and uncontrolled gambling industry. They are employing all available means to pursue unlawful enterprises. Immediate outcomes may not be evident, but their commitment to this cause extends for the long term.
The AGA collaborates with Congress to ensure that law enforcement gives utmost importance to investigating and prosecuting illegal gambling activities.
The AGA is actively collaborating with state attorneys general to address the methods utilized by these “bad actors” to circumvent legal regulations.
Miller stated that unregulated and illegal businesses are capitalizing on our expansion and the influx of inexperienced gamers. These entities blatantly disregard the law and exploit consumer uncertainty in an attempt to appear legitimate. We refuse to tolerate this behavior and are actively engaging with state legislatures to bolster regulations and eliminate loopholes. Furthermore, we are collaborating with private sector stakeholders to terminate platforms that facilitate illegal gambling activities.
Miller also pointed out that the legal gambling industry in the U.S. has been established within the past five years, while the illegal gambling market has been in existence for decades. Although it is a challenging endeavor, both the AGA and the MGCB are dedicated to emerging victorious in this battle.
