Compliance Updates

Florida Targets Fantasy Sports Firms Over Possible Illegal Betting Games

Published

1 year ago

September 26, 2023

Florida gambling regulators have sent cease-and-desist letters to three daily fantasy-sports operators accused of offering potentially illegal mobile betting games and threatened legal action if the sites don’t immediately stop.

Commission Executive Director Lou Trombetta sent letters warning the three companies that they “may be offering or accepting illegal bets or wagers” from Floridians and “may be promoting and conducting an illegal lottery.”

The alleged conduct is “strictly prohibited in Florida and constitutes criminal activity,” Trombetta wrote.

The letters targeted Underdog Sports, LLC, which is based in Brooklyn, N.Y; SidePrize LLC, also known as Performance Predictions LLC, doing business as PrizePicks, which is based in Atlanta; and Betr Holdings, Inc., which is based in Miami.

In fantasy sports, players can draft rosters of actual athletes, with the winners of fantasy games determined by the statistics of the athletes. Many games, like office pools, last all season.

The three companies offer what are known as “parlay-prop-style” games that could be more similar to sports-betting games that are off-limits in Florida.

“Under Florida law, betting or wagering on the result of contests of skill, such as sports betting, including fantasy sports betting, is strictly prohibited and constitutes a felony offense unless such activity is otherwise exempted by statute,” Trombetta’s letter said. “Accordingly, in Florida, sports betting may be lawfully conducted only pursuant to a gaming compact. … Further, receiving such illegal bets and wagers and aiding or abetting such criminal activities constitute separate felony offenses. … Lotteries are also strictly prohibited in Florida.”

A gaming compact is an agreement reached with the state.

The commission did not send letters to DraftKings and FanDuel, which have dominated the fantasy-sports market in the decade since the online games launched.

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It was unclear Friday if the commission would crack down on other operators in the future, but emails show the gambling overseers could be casting a broad net.

“As you might imagine, my exec team asking what the letter means and seeking actionable advice, pretty urgently. Would like to discuss the substance at some point, but if you can help with one question, it would be great. Namely, Underdog operates multiple paid fantasy formats (season-long drafts, daily drafts, pick’em) and I just want to confirm my reading of the letter, which is that the legal conclusion applies to all paid fantasy contests — e.g., all of our contests — and not just particular types,” Nicholas Green, Underdog’s general counsel, wrote Friday to Ross Marshman, the commission’s general counsel.

“Your reading of the letter is correct,” Marshman replied.

John Lockwood, an attorney hired by multiple operators, warned that other companies could be swept up in the crackdown.

“The commission staff confirmed to me that the language in the letter broadly applies to all paid fantasy sports contests, and they are not aware of any paid fantasy sports company operating legally in Florida. We disagree on the merits and will be working with the commission and potentially the Legislature so we can ensure Florida sports fans can continue to play,” Lockwood said.

State lawmakers in the past have grappled with creating regulatory oversight for the fantasy-sports industry, to no avail. Proponents of fantasy sports have insisted that the contests are games of skill, not chance, and thus are legal under state gambling laws.

Trombetta issued the letters as a legal battle continues over a 2021 compact reached by the state and the Seminole Tribe. That deal gave the tribe control over sports betting in Florida.

A “hub and spoke” plan in the agreement would allow gamblers anywhere in the state to place bets online, with the wagers run through servers located on tribal lands. The deal requires sports betting to be “exclusively conducted” by the Seminoles but allows other operators to run fantasy sports contests.

Owners of West Flagler Associates and Fort Myers Corp., doing business as Bonita Springs Poker Room in Southwest Florida, filed a lawsuit challenging the compact, saying it violated federal law and would cause a “significant and potentially devastating impact” on their operations.

A federal judge in Washington, D.C., in November 2021 ruled that the deal violated a key Indian gambling law. But a three-judge panel of the U.S. Circuit Court of Appeals for the District of Columbia in June reversed that decision. The appellate court last week denied a request for what is known as an “en banc” rehearing before the full court.

The pari-mutuel owners filed a motion saying they would ask the U.S. Supreme Court to weigh in, arguing the panel’s decision conflicts with other appellate rulings and “enables an extreme shift in public policy on legalized gaming that, once started, may be difficult to stop.”

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Compliance Updates

SYNOT Games Takes a Leap Forward with Certification Milestone in Argentina

Published

4 minutes ago

January 31, 2025

Niji Narayan

SYNOT Games announced that 140 of its top-tier games have been officially certified for the Argentinian market.

The certifications, issued by Gaming Labs International mark a significant step in SYNOT Games’ commitment to delivering high-quality, compliant, and entertaining products to the Latin American market.

In addition to the 140 games, the certifications include the renowned SYNOT Progressive Bonus and advanced Random Number Generator technology, providing operators and players with a superior and trustworthy gaming experience.

SYNOT Games is committed to certifying its entire game portfolio for the Argentinian district shortly. This will further solidify the company’s presence in the rapidly growing Latin American market and reaffirm its position as a trusted partner for local and global operators.

Martina Krajci, CCO at SYNOT Games, said: “We are delighted to achieve these certifications and bring our innovative products to Argentina. This is an important milestone in our global expansion strategy, and we look forward to offering our Argentinian partners and players access to our certified games, backed by industry-leading technology and robust compliance standards.”

Compliance Updates

Michigan Gaming Control Board Orders MyBookie.ag to Cease Operations in the State

Published

4 days ago

January 27, 2025

Niji Narayan

The Michigan Gaming Control Board (MGCB) has issued a cease-and-desist letter to Duranbah Limited N.V., the operator of MyBookie.ag, based in Curaçao. The site offers a variety of casino-style games, such as slots, poker, and live-dealer games like blackjack, roulette, and craps. It also allows users to place bets on sporting events and horse races.

MGCB Executive Director Henry Williams stressed the agency’s dedication to safeguarding consumers and ensuring compliance with Michigan’s gaming regulations.

“Our investigation into MyBookie.ag found that their operations were accessible to Michigan citizens, which violates state laws. We are taking strong action to uphold the principles of fair and legal gaming,” Williams said.

MyBookie.ag offers numerous payment methods for deposits and the funding of players’ accounts, including Visa, MasterCard, American Express, PayPal, various cryptocurrencies (Bitcoin, Ethereum, Litecoin, and others), and MoneyGram. However, withdrawals can only be made via Bitcoin or bank wire transfer.

The MGCB’s investigation revealed that MyBookie.ag’s operation of online casino-style games for paying customers, without a valid Michigan gambling license, breaches several state laws, including:

• Lawful Internet Gaming Act: Internet gaming is only permitted by licensed operators. Only casinos licensed under the Michigan Gaming Control and Revenue Act and federally authorized tribal casinos within Michigan may apply for such a license.

• Michigan Gaming Control and Revenue Act: Operating a gambling business without an MGCB-issued license is a felony, carrying penalties of up to 10 years in prison, a fine of up to $100,000, or both.

• Michigan Penal Code: Gambling, which involves consideration, prize, and chance, is broadly prohibited. Accepting money or anything of value with the understanding that it will be paid based on the outcome of an uncertain event is illegal.

Duranbah Limited N.V. has 14 days from receipt of the letter to cease offering gambling services to Michigan residents, as required by the cease-and-desist letter. If the company fails to comply, the MGCB is prepared to collaborate with the Michigan Attorney General’s Office for further legal actions.

Compliance Updates

MGCB Executive Director Applauds Reappointment of Board Member Deidre A. Lambert-Bounds by Governor

Published

7 days ago

January 24, 2025

Niji Narayan

The Michigan Gaming Control Board (MGCB) has announced the reappointment of Troy resident and Board member Deidre A. Lambert-Bounds by Gov. Gretchen Whitmer. This reappointment reaffirms the governor’s confidence in Lambert-Bounds’ dedication, integrity, and invaluable contribution to the agency’s mission of ensuring a fair and transparent gaming environment.

MGCB Executive Director Henry Williams expressed deep appreciation for the governor’s decision, noting that Lambert-Bounds’ continued leadership will greatly benefit the agency.

“Board member Lambert-Bounds has consistently demonstrated exceptional commitment and insight in regulating Michigan’s gaming industry, and we are thrilled to have her continue as a vital part of our Board. This reappointment is a testament to her unwavering dedication to upholding the highest standards of integrity and fairness,” said Williams.

Reappointed for a term expiring Dec. 31, 2028, Lambert-Bounds is the president and co-owner of Ignite Social Media LLC, and the chief operating officer and co-owner of its sister company, Carusele Media. She also serves on the executive boards of the Sphinx Organization, International Women’s Forum, and the Michigan Partnership for Equity and Opportunity.

The reappointment is Lambert-Bounds’ second four-year term of serving on the MGCB, representing Independents, for a term expiring Dec. 31, 2028. She previously served from July 22, 2021, through Dec. 31, 2024, and succeeded Barbara Smith, whose term expired Dec. 31, 2020.

The MGCB is responsible for implementing, administering, and enforcing the provisions of the law related to the licensure, regulation, and operations of the three authorized Detroit casinos — MGM Grand Detroit, MotorCity Casino, and Hollywood Casino at Greektown. The agency also licenses and regulates fantasy contests, regulates pari-mutuel horse racing and casino-style charitable gaming (millionaire parties), and audits tribal gaming compact agreements for the state’s 12 federally recognized tribes.

The Board comprises five Michigan residents appointed by the Governor, with one member designated by the Governor as the chairperson. Under the Michigan Gaming Control & Revenue Act, no more than three members may belong to the same political party.