Legal Crackdown
New Jersey is definitely one of the two hotspots for legal sports betting in the U.S, the other being on the other side of the country in Nevada. As a matter of fact, there have been multiple months this year (May and July) where New Jersey has actually experienced more sports wagers placed (by total value) than Nevada.
Much of this is due to New Jersey being one of the first states to actually legalize sports betting. Not only that, but there are several avenues for interested bettors to actually make their bet. Besides having numerous physical locations, mobile sports betting is also extremely popular throughout the state.
With all of the activity in New Jersey’s legal sports betting market, the state’s Department for Gaming Enforcement has decided to take a closer look. The department’s director has indicated that this is to ensure that bettors in New Jersey are actually making legal sports wagers. He continued by mentioning that there are more than 10,000 websites currently allowing illegal bets to be made.
This is a problem because the sportsbooks behind these websites are taking wagers without paying taxes on them. The New Jersey Department of Gaming Enforcement (DGE) can only assert authority over their own state, so they are focusing on sportsbooks that have allowed bets from residents of New Jersey. Any sportsbook that is found to be illegally accepting wagers will be fined and have assets seized.
When the DGE decided to investigate sports betting activities within the state, they actually named three companies that are likely operating illegally. This includes Bovada, Bookmaker, and BetOnline. Now two of those sportsbooks have completely withdrawn from New Jersey as a result of the DGE’s scrutiny.
Bookmaker and BetOnline Vanish from New Jersey
The two sportsbooks that ceased activity in New Jersey are BetOnline and Bookmaker. There isn’t any definitive proof yet that both companies were illegally accepting sports wagers, but instantly vanishing from a state can certainly be viewed suspiciously.
Both Bookmaker and BetOnline’s servers are located outside of the U.S. Because of this, both sportsbooks have interpreted the U.S’s unclear online sports wagering laws as giving them permission to operate if their servers aren’t located within the U.S. However, the law became very explicit via the Unlawful Internet Gaming Enforcement Act.
Despite this law being passed more than a decade ago, it hasn’t been an issue because the regulators overseeing online sports betting haven’t had a desire to actually investigate internationally based sportsbooks. Bookmaker and BetOnline are likely only now taking action because the New Jersey DGE has vowed to seize assets of any illegal sportsbook.
While neither sportsbooks have given an official comment for their department, you can only speculate as to their reasoning. For now, anyone living in New Jersey will be prohibited from creating an account on Bookmaker and BetOnline. Any existing funds must be withdrawn before October 1st and any current wagers will be refunded.
With New Jersey’s heightened scrutiny on sports betting, there’s a good chance other states follow a similar path. This will be great for legal sports betting as it will weed out any unlicensed sportsbooks operating in the U.S. As a result, the public image of sports betting will gradually improve.
