The Pennsylvania state capitol; Pennsylvania attorney general Dave Sunday believes unlicensed gambling outlets cost the state tens of millions of dollars in tax income every year
Courtesy of Wikimedia Commons
Dollar & Sense with Frank Angst
After years of being among the groups leading the charge against offshore gambling targeting United States players, horse racing now has some powerful allies thanks to the growth of licensed online wagering, especially sports wagering.
When licensed pari-mutuel wagering was largely the only game in town in terms of online wagering, horse racing had the most to lose to offshore (illegal) wagering. Now that some of the most powerful gaming companies in the world—FanDuel, DraftKings, Caesars, MGM, and others—are benefitting from online sports wagering—as well as the coffers of states that allow online wagering—there are some powerful voices lining up against offshore wagering.
Earlier this month, a bipartisan coalition of 50 attorneys general from states and territories signed a letter calling on the United States Department of Justice to carry out enforcement actions against such operators. The letter notes that, under the Unlawful Internet Gambling Enforcement Act, the USDOJ has more powers of enforcement than states.
“USDOJ can pursue injunctive relief to block access to illegal websites and payment processing mechanisms,” the letter notes. “Additionally, USDOJ has the authority to seize assets—including servers, domains, and proceeds—that illegal gambling operations use. Because the websites owned by unlawful offshore operations violate federal law, USDOJ can and should seize the websites and domain names of operators and retain any proceeds recovered as part of the seizure.”
The coalition contends that illegal online gaming is estimated to exceed more than $400 billion in annual volume, leading to more than $4 billion in lost tax revenue for states.
Pennsylvania attorney general Dave Sunday joined the bipartisan coalition, noting that unlicensed gambling outlets cost Pennsylvania tens of millions of dollars in tax income every year.
“Illegal offshore gaming and gambling companies circumvent all state and federal laws with one mission: to increase players and maximize profits—exposing children and other vulnerable Pennsylvanians to gambling without protections offered by legitimate outlets,” Sunday said in a release. “Gambling and gaming remains legal in Pennsylvania, and online gamblers should look for the official Pennsylvania Gaming Control Board logo on licensed operators’ websites to ensure their gaming and gambling experience is safe and regulated.”
An online search of offshore bookmakers and horse racing brings up a number of outlets. In the spring, the Michigan Gaming Control Board sent cease and desist letters to four alleged offshore operators. According to the state release on the action, one of those outlets, “Wager 7,” allegedly targeted U.S. horseplayers.
Thoroughbred Racing Protective Bureau executive vice president J. Curtis Linnell said there are a number of offshore websites that continue to advertise services on the Internet, for instance, in chat rooms focused on betting horses.
“In general, we’re always concerned about illegal offshore betting and certainly the negative effect that it has on pari-mutuel wagering,” Linnell said. “It’s something we watch for. We look for reports from our client associations and regulators, and look to pursue whenever we’re able.”
With some major new licensed sports betting platforms that have generated significant revenue for states, horse racing is not alone in this fight.
