Future of 1xBet clouded
1xBet founder death reports, 2023 US legalization roundup, NFL player rules, Malta’s court move +More
Good morning. On today’s agenda:
1xBet co-founder Sergey Karshkov reportedly dies in hospital in Switzerland.
A better year than expected for US legalization.
NFL reminds players of gambling policy.
Malta moves to shield its licensees from foreign court orders.
Ontario issues fines.
1xBet founder reported dead
The founder of the controversial offshore operator 1xBet has reportedly died while undergoing treatment in Switzerland.
Russian media is reporting that Ukrainian-born Sergey Karshkov, founder of the controversial 1xBet, has died following a medical incident at a clinic in Switzerland.
Newsweek reported the news yesterday following a report on Russian news site The Voice. C+M has been unable to confirm his death.
Both reports were based on an alleged Facebook posting by an associate, which suggested Karshkov, 42, had an allergic reaction to MRI fluid during a scan.
Pillar to post: Karshkov founded 1xBet alongside Roman Semiokhin and Dmitry Kazorin. Karshkov and his associates based themselves in Cyprus where the company is headquartered. It operates under a Curaçao license and other local licenses.
Late last year, a Curaçao-domiciled entity owned by 1xBet called 1хCorр was declared bankrupt. This decision was subsequently ratified by a court in the Netherlands but 1xBet subsequently denied the reports.
It said in a statement at the time: “1xBet has encountered no issues concerning its Curaçao license, which remains in place and with which it is fully compliant, and everything is business as usual.”
Most recently, 1xBet was involved in a dispute with the Ukrainian authorities after it had its license to operate revoked in early September due to the company’s connection to Russia, only for the authorities to reverse the decision a week later.
1xBet halted operations into the UK in 2019 following an investigation by The Sunday Times.
The paper found that 1xBet had been used to promote betting on children’s sports, cockfighting and a pornhub casino with topless women dealing the cards.
English Premier League clubs Chelsea, Liverpool and Tottenham were subsequently warned by the Gambling Commission over their sponsorship links with 1xBet.
The company also has a high-profile sponsorship arrangement with La Liga club Barcelona and has had a host of sponsorship deals with other football clubs and leagues and in esports.
Regulus Partners in January estimated 1xBet to be the largest online gambling company by revenue “although we recognize that this requires more estimation than most of the other businesses”.
“What it does do is Live Dealer better than everybody else, in our view, and in more places than other operators can manage from an operational, risk and payments perspective,” the team added.
“If you don’t know who the market leader is in a particular opaque dot.market – it is probably 1xBet,” Regulus added.
Follow the Money: A Dutch investigative news site just this week published a long piece looking into 1xBet’s background and its activities in Curaçao.
US legalization season
This year’s legislative season was slightly better than forecast.
On a roll: Following the repeal of PASPA in May 2018, online gambling went on a multi-year winning streak. By the end of 2021, 28 states and the District of Columbia had joined Nevada as OSB states. Additionally, three states legalized online casinos: Michigan, West Virginia and Connecticut.
Nearly eight states a year legalized online gambling from mid-2018 to the end of 2021. That success came to a screeching halt in 2022 and 2023.
Over the last two years, the average number of new online gambling states has more than halved to 3.5.
The slowdown can be chalked up to two things:
The US is running out of states on the OSB front.
Online casino legalization has been a far more difficult lift in state legislatures.
Apples with apples: In 2022, just three states legalized OSB – Kansas, Maine and Massachusetts. The only state of consequence in that group is Massachusetts.
On the OSB front, 2023 matched 2022, with three states legalizing mobile sports betting: Kentucky, North Carolina and Vermont. And, once again, there was only one state of consequence, North Carolina. However, combined, the additions in 2023 have a significantly larger population:
The combined population of Kansas, Maine, and Massachusetts is 11.3 million.
The combined population of Kentucky, North Carolina, and Vermont is 15.7 million.
RI lights the online casino fire
Rhode on time: The big difference between 2022 and 2023 is on the online casino front, with Rhode Island’s legalization of online casino gambling allowing 2023 to pip 2022.
Despite being the smallest state in the US, and one of the least populated, Rhode Island’s foray into the far more exclusive online casino club makes 2023 demonstrably better than 2022. Rhode Island is a Gov. Daniel McKee signature away from legalizing online casinos.
Online casino legalization has been few and far between, with just seven states taking the online casino-poker plunge over the last decade:
In 2012, Delaware became the first state to legalize online casino and online poker.
Nevada legalized online poker on February 25, 2013.
New Jersey officially legalized online casino and online poker on February 26, 2013.
In 2017, Pennsylvania legalized online casino and online poker.
Michigan legalized online casino and online poker in 2019.
2019 also saw West Virginia legalize online casino and poker.
Connecticut legalized online casino and poker alongside sports betting in 2021.
If at first you don’t succeed: The lack of success is not from a lack of trying. In addition to Rhode Island, six states – Maryland, Kentucky, Illinois, Iowa, Maine and New Hampshire – introduced online casino legislation in 2023.
Only New Hampshire made headway, with its online casino bill squeaking through the Senate by a single vote in March before failing in the House.
With online casino states a rarity, every state is big news, even one as small as Rhode Island. As I wrote on Gambling.com earlier this week, RI could have a knock-on effect throughout the country.
Like sports betting, the idea of dollars trickling across the border will nudge other New England states such as Massachusetts, New Hampshire and Maine to jump into the online casino pool.
It further demonstrates that online casino is a noncontroversial vote, which despite no lawmaker losing their seat over an affirmative online gambling expansion vote, is still somehow a widely held belief.
With a launch date of March 2024 (right in the heart of state legislative calendars), any state considering online casino legislation will see a barrage of headlines about Rhode Island’s online gambling launch.
US notebook
A taxing situation: Ohio’s House of Representatives has voted to not concur with the state Senate’s changes to state budget bill HB 33, which includes a provision that raises the tax rate on OSB to 20% from the current rate of 10%.
A committee is expected to work through the differences later this week. The bill needs to be signed by June 30.
Maryland: A sports-betting lobby group called the Sports Betting Alliance has received a $48,000 fine from the Maryland State Board of Elections for a failure to comply with election disclosure rules.
Further reading
Was Chris Christie the George Washington of internet gaming? Was he heck.
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NFL and gambling
After a string of violations, the National Football League (NFL) hands down six key rules for players to follow.
Dirty half-dozen: In a conference call on Tuesday on which gambling policy and education were discussed in the wake of six players having broken its betting rules, the league laid down these principles:
Don’t bet on the NFL.
Don’t gamble at your team facility, while traveling for a road game or staying at a team hotel.
Don’t have someone bet for you.
Don’t share team “inside information”.
Don’t enter a sportsbook during the NFL playing season.
Don’t play daily fantasy football.
Betting on the NFL means gambling on anything NFL-related, such as honors, draft or daily fantasy sports.
Players can gamble on non-NFLsports, but they can’t do it “at work”.
Detroit Lions wide receivers Jameson Williams and Stanley Berryhill III were busted doing just that, and both earned six-game suspensions.
Taking names: In the call, NFL chief compliance officer Sabrina Perel said the league will be alerted if a player uses their own name on a gambling app. Rookies entering the sport will also have to undergo mandatory gambling policy training.
In May, four players from the Detroit Lions – Williams, Berryhill, Quintez Cephus and C.J. Moore – and Shaka Toney of the Washington Commanders were suspended for gambling violations.
Cephus, Moore and Toney were given indefinite suspensions that will run for at least a year.
Isaiah Rodgers of the Indianapolis Colts is reportedly under investigation, but the league declined to comment on the situation, according to Front Office Sports.
Malta defense
Malta’s parliament approves a controversial bill that shields the country’s offshore operators from foreign liability.
Protect ya neck: On 16 June, Malta’s president signed an act into law that blocks the courts from recognising or enforcing any foreign judgements against Malta licensees in Europe.
Malta is one of the most popular hubs for offshore operators to gain licenses, and the new rules would grant their protection from prosecution by other jurisdictions in the EU’s single market.
The new laws follow talks between Minister for the Economy Silvio Schembri and operators after a raft of overseas lawsuits, including ongoing cases in Austria and Germany.
Civil courts in the jurisdictions have been attempting to collar gray market Maltese-licensed companies and have them compensate punters for historical losses, running up to hundreds of millions euros.
It remains to be seen if Bill 55 is aligned with European Union law.
Battle lines: Many industry experts believe Malta is violating international agreements in protecting gambling operators facing lawsuits.
The development is “particularly concerning” for countries that have initiated proceedings, said Hermann Pamminger, head of public & European affairs at Casinos Austria and secretary-general of the European Casino Association.
“The amendment opens a legal loophole that allows Maltese online gambling companies to disregard national laws in other European countries, undermining the principle of free movement of goods and services throughout the EU,” he said.
“Given the large presence of Maltese gaming companies throughout European markets, the potential impact will be significant.
“In response to this situation, it will be interesting to see how national regulators take proactive steps to uphold their national laws and protect their citizens’ interests.”
Malta notebook
MKC: Malta has canceled the license of MKC Ltd after the company failed to make the required licensing payments. MKC recently received a cease-and-desist letter from the Netherlands regulator with regard to unlicensed operations.
Ontario fines
BV Gaming (BetVictor) and Fitzdares run afoul of Ontario authorities.
Skating on thin ice: BV Gaming and Fitzdares have both been fined C$30,000 by the Alcohol and Gaming Commission of Ontario after it was alleged they offered bets on Ontario Hockey League, Western Hockey League and Quebec Major Junior Hockey League games during the 2022-23 season.
The regulations expressly prohibit offering bets on minor league sports, including the Canadian Hockey League’s three major junior hockey leagues.
The operators have the right to appeal the verdict.
“We will continue to carefully monitor Ontario’s sports-betting markets to ensure the public interest is protected,” said Dave Phillips, COO at the AGCO.
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Levy backing
GambleAware and NHS England welcome the introduction of a statutory levy for the funding of gambling harms research and treatment.
Gravy train: The NHS has “no wish” to be the sole provider of treatment for those harmed by gambling, according to the national clinical advisor on gambling harms for NHS England, Prof. Henrietta Bowden-Jones.
Bowden-Jones added that “on the contrary”, the NHS is “committed to working with non-statutory providers of gambling treatment across the country”.
She added that the statutory levy that featured as part of the UK government’s Gambling Act Review White Paper “has the potential to finally ensure the independence of funding for treatment and research programmes”.
Stable platform: GambleAware CEO Zoë Osmond said the introduction of a statutory levy “provides certainty and stability of funding, which will allow us and others to make long-term commitments to meet the needs of the population”.
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