Making the fight against illegal gambling a top concern in Michigan, the Michigan Gaming Control Board persists in its efforts.
The MGCB recently joined forces with regulators from seven gaming states to collectively request the U.S. Department of Justice to prioritize the fight against illegal offshore sportsbooks and online casinos.
On April 28, Attorney General Merrick Garland received a letter concerning the challenges of offshore gambling, which state regulators are currently unable to handle independently.
According to the American Gaming Association, the annual amount of illegal gambling in the United States is estimated to reach $511 billion.
The popularity of Michigan online casinos is on the rise, while Michigan online sportsbooks are maintaining a steady position. Eliminating illegal markets would only enhance the state’s regulated online industry.
States urge DOJ to aid in stopping illegal gambling
The letter included the states of Colorado, Illinois, Louisiana, Mississippi, New Jersey, Nevada, and Michigan.
“We are committed to upholding the strict laws and regulations governing internet gaming and sports betting in Michigan. These measures are in place to protect consumers, foster trust, and ensure a fair and transparent gaming environment,” stated Henry Williams, the Executive Director of MGCB, in a press release. He further expressed the agency’s readiness to support the U.S. Department of Justice in its efforts to enforce laws against offshore illegal gaming enterprises that exploit our citizens.
The regulators highlighted the risks associated with illegal offshore gambling websites in their letter. These risks encompass:
- There are no age verification requirements in place to safeguard minors.
- Insufficient funding for initiatives promoting responsible gaming
- There are no measures in place to prevent money laundering.
- Customers are not guaranteed fair payouts.
- The reduction in state tax revenue, which plays a crucial role in funding vital initiatives such as education.
The absence of adherence by offshore operators to the same requirements as state-regulated operators prevents the MGCB from legally resolving any disputes between a consumer in Michigan and an offshore operator.
Through its leadership in enforcement action against offshore operators, the Department of Justice has the ability to tackle these critical issues.
Williams expressed his concerns about offshore operators who violate state regulations by offering products that do not meet the required technical standards and testing. He emphasized that state regulators, such as the MGCB, ensure that operators comply with reporting requirements to protect the public.
Illegal gambling costing $13.3 billion in lost tax revenue
Illicit gambling activities within the country result in a staggering $511 billion being wagered illegally every year, causing a significant loss of tax revenue amounting to $13.3 billion.
In 2021, the tax revenue generated by legal operators amounted to a staggering $11.7 billion.
“This report sheds light on the pervasive nature of illegal and unregulated gambling, which poses a significant threat to our society. It preys on vulnerable consumers, evades regulatory responsibilities, and deprives communities of essential tax revenue that could be used for vital infrastructure, education, and other important purposes,” stated Bill Miller, President and CEO of the AGA, in a press release. “We have long been aware of the extensive reach of the illegal and unregulated market, but this report further emphasizes its alarming scope.”
Let’s examine the breakdown of the illegal and unregulated market in the United States.
Unregulated machines, commonly known as “skill machines,” have garnered significant attention in Michigan, with the latest incident occurring in Delta Township. During the raid, authorities confiscated 36 machines and seized a sum of $23,000 in cash.
