Playing both sides
Play’n GO admits to games being available in black markets
Uncovering of black market supply follows the provider’s sweeps stand.
Sports-betting leaders take a tumble in Illinois tax news.
The Isle of Man signals a policy change over Asian-facing licensees.
Black market sites attract self-excluded Belgians.
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Foul Play
Hey, hey, hey, into the black: Play’n GO has defended itself against evidence that some of its most popular games are available on black market sites targeting the Netherlands and Germany.
C+M has seen evidence that Play’n GO titles, including ‘Book of Dead’, ‘Mission Cash’ and ‘Pilgrim of Dead’ are available on the Curaçao-licensed FoxyGold.com and Goldspin.
Both sites make their offerings available to customers from the Netherlands and Germany despite being unlicensed in those territories.
Line to fake: At the start of May, Play’n GO CEO Johan Törnqvist made much of his company’s decision not to make its games available to the sweepstakes gaming market, saying the sites “do not operate inside a regulated framework and that’s not something we support.”
“Our commitment to regulated markets is absolute,” he added.
A little bit pregnant: Now the company admits its games are available on black market sites but claims it sees “close to zero traffic from unlicensed operators,” according to Shawn Fluharty, head of government affairs at Play’n GO.
“As little as one to two euros a day, which can be attributed to various issues, including VPN-generated traffic,” he added.
It wasn’t me: Fluharty said the two sites mentioned “seem to be customers of several large resellers and appear to hold international licenses allowing them to provide games to pre-regulated markets.”
He added: “If there is suspicion that they are also providing games to regulated jurisdictions without the proper licences in place, then the relevant regulators should be notified so they may take appropriate action."
Walk, don’t walk: Fluharty repeated Törnqvist’s invocation of “vociferous” regulated market support, saying “we don’t just talk the talk.”
“Play’n GO closely monitors our traffic and notifies operators immediately when we see that things aren’t right,” he added.
“We go above and beyond the requirements with IP blocking, geofencing and other mechanisms.”
Memory hole: At the time of the sweepstakes announcement, Fluharty was quoted as saying that regulators across the US in particular are “rightfully beginning to crack down on these unregulated operations.”
“And I can say with confidence that regulators have long memories,” he added.
“Anyone doing business with sweepstakes casinos today will find it very difficult to do business in a future regulated market.”
Fluharty told C+M last week that the company is licensed in the Netherlands but there was “no such license in Germany yet, though Play’n GO would strongly welcome the implementation of one.”
Know your enemy: Foxy Gold is run by a Costa Rican-based entity called EOD Code, which also owns a host of black market and crypto-based casinos.
C+M found that various of these sites, including one called CoinKings and another called WSM Casino, advertise themselves as offering Play'n GO games.
Black and white: The issue of games from leading suppliers being available in both regulated and unregulated markets has taken on new resonance in recent months after it was announced in late December that Evolution was under investigation by the UK Gambling Commission.
That case turns on the alleged availability of Evolution’s live casino games on black market sites offering into the UK.
Evolution has since moved to “ring-fence” operations in the UK and other regulated European markets.
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Illinois tax take
Double take: For the second successive year, Illinois lawmakers have made a raid on the revenues of the leading sportsbooks and hiked taxes.
This time the legislature sneaked a measure into the budget proposals at the last minute, with a new top rate of 50¢ per wager for every dollar of GGR above $20m.
The measure is designed to increase the tax revenue from the top-tier operators and, as the analysts pointed out, is set at a level that, going by the LTM figures, would see only FanDuel and DraftKings pay the top rate.
Recall, Illinois introduced its progressive tax rate in last year’s legislative session, with rates ranging from 25-40% of GGR.
Hitting them hard: DraftKings suffered a 6% share price reverse and Flutter, parent company of FanDuel, was down nearly 3% in New York on Monday. See Monday’s Earnings+More coverage.
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New Jersey: More sweeps developments have come from New Jersey where the bill aimed at shutting down “illegal sweepstakes gambling operations” has advanced through a key Senate committee stage. Meanwhile, the bill to outlaw sweeps in Louisiana has passed the state House and now heads to the Governor’s desk. The bill will prohibit the “operation, conduct or promotion of unregulated online casino games.”
Read ahead: Laurence Escalante, the founder and CEO of the leading sweepstakes operator VGW, has offered to take full control of the business in a deal that would value the operator of Chumba Casino, Luckyland Slots and Global Poker at A$3.3bn or ~$2.1bn. See tomorrow’s Earnings+More.
Bodog gone: A judge in Manitoba, Canada, has banned Bodog from operating in the province and ordered it to cease operating any sites accessible to people in Manitoba. In a court order last week, Judge Jeffrey Harris ruled that the Antigua and Barbuda-based Il Nido Ltd and Sanctum IP Holdings Ltd – the companies behind Bodog – must implement geo-blocking technology so no one in the province can access or otherwise engage with any gambling products they offer.
Going out on a high: High 5 Games has settled with Connecticut gaming regulators and has ceased its sweepstakes gaming operations into the state after receiving a cease-and-desist letter in March. The company will also pay a settlement of $1.44m and can now resume the provision of online games to operators within the state.
Brazil: The Secretariat of Prizes and Bets has suspended seven online betting operators for failing to provide reports about their security systems. Among the seven operators are PixBet and BETesporte. The regulator said it will impose a daily fine of BRL40,000 ($7,050) if non-compliance continues.
Sri Lanka: The government has proposed a draft bill to establish a Gambling Regulatory Authority at the direction of President Anura Kumara Dissanayake. The regulatory authority will serve as the sole independent regulator for gaming in Sri Lanka, including in the city of Colombo where Melco Resorts is slated to open a casino in the third quarter.
BetMGM has been rapped on the knuckles by the Dutch gambling regulator over an ad featuring 17-year-old Barcelona wunderkind Lamine Yamal. The ad violated advertising rules for gambling, which prevent betting firms using images of sports personalities who have an influence over younger demographics.
Kenya: Restrictions on gambling ads have been introduced by the Betting Control and Licensing Board, including outlawing certain language in ads, the institution of mandatory responsible gaming messaging and reviews by the Kenya Film Classification Board.
What we’re reading
Talk to the hand: Tribal representatives have come away from a meeting with the Commodity Futures Trading Commission underwhelmed by acting chair Caroline Pham, suggesting it was “basically like she was showing us all the ways they can’t do anything.” Sources speaking to InGame said the meeting was “extremely frustrating.”
IoM’s risky business
Volte-face: The Isle of Man said it has “limited appetite” for doing business with online gaming entities where there is ownership of control from either East or Southeast Asia, marking an about turn on years of dealing with Asia-focused bookmakers.
The statement comes from the Manx government’s national risk appetite document released last week as part of its preparations for an upcoming MONEYVAL evaluation.
The government now says that “where there is an accumulation of higher-risk factors there is an extremely limited appetite within the regulators to grant a licence.”
Isle of scam: The news of the change follows on the heels of arrests related to the Isle of Man-domiciled Ableton Prestige Global Limited and Amiga Entertainment.
Separately, allegations in a UN report suggested the Isle of Man-based online gaming company King Gaming employed people who were previously convicted by the Chinese authorities for conducting a massive fraud operation that swindled millions of dollars from victims in China.
The risk assessment document said the government has been “reviewing and enhancing the way it licences and supervises the sector” in light of the report.
Not all white: In a related matter, the Isle of Man white label provider TGP Europe – which facilitated the entry of many Asian-facing brands into the UK – surrendered its license under pressure from the UK Gambling Commission.
Chutzpah: Talking about the change of heart over Asia-facing gambling entities, the IoM’s minister for Justice and Home Affairs, Jane Poole-Wilson, said the island was “committed to playing its part” in disrupting serious and organized transnational crime.
Horse/stable door interface: “The National Risk Appetite Statement is a crucial step in ensuring that our economy remains strong and diverse, while protecting our Island, its people and its businesses from exploitation,” she added.
“The Isle of Man is open for good quality, reputable business. To support those aims, this statement will provide to industry and wider stakeholders the clarity they need.”
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Belgian black market
Backsliding: Nearly half of all players that have self-excluded in Belgium have resumed their gambling via black market sites, according to a survey commissioned by the Belgian Association of Licensed Gaming Operators (BAGO).
EPIS fail: The Belgian Gaming Commission has run an electronic database called EPIS since 2004. EPIS stands for Excluded Persons Information System and it includes all players who are legally excluded from gambling.
However, the study found that 47% of self-excluded players had been lured back via illegal channels.
The young and the restless: The survey also found that one in four online players in Belgium had interacted with the black market. In particular, the survey highlighted the rising levels of black market activity among men aged 18-21, with the percentage who reported having used an unlicensed site rising from ~50% to 65%.
BAGO said the rise in illegal gambling was being fuelled by “intensive” social media advertising.
Do something: “We are on a slippery slope,” said Tom De Clercq, chair of BAGO, who suggested that black market operators had been given “free rein.”
“If we do nothing, Belgium – like some neighboring countries – risks losing control of its gambling market,” he warned.
Emmanuel Mewissen, vice-chair of BAGO, called for the government to equip the Gaming Commission with the tools to “evolve into a powerful regulator.”
Calendar
Jun 5: Gaming in Holland, Amsterdam
Jun 9-12: IAGA, Berlin
Jun 10-11: European regulation and compliance track at SBC Malta.
Jun 19: Player protection symposium, CGS Toronto
Jun 26: Gaming in Spain, Madrid
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