Michigan Gaming Control Board Orders Bovada to Stop Taking Bets

The Michigan Gaming Control Board has ordered Curacao-based gambling sites Bovada.com and Bovada.lv to stop taking bets in the state.

Harp Media BV, which operates both unregulated offshore sportsbooks, was issued cease-and-desist orders on Wednesday, according to a press release. The MGCB will “take legal action,” according to the release, if Bovada doesn’t comply by June 13.

One industry observer told Gaming Today that Michigan’s ability to stop Bovada would be minimal. Even tech solutions such as restricting access to the sites is in essence a game of “Whac-a-Mole” because offshore sites simply adjust their domains.

But, they noted, the MGCB effort is worthwhile from an educational standpoint as scores of new bettors in many states are unaware sites like Bovada are illegal.

A MGCB spokesperson told Gaming Today that Michigan was “prepared to take further action on multiple fronts:

“Bovada’s U.S. suppliers may also face consequences. Certainly, any business relationship with an illegal operator will very likely prevent a company from being licensed to do business in the very large Michigan gaming market. With this letter, we have made a clear statement that Bovada is violating Michigan laws. If Bovada fails to comply with the letter, we would strongly encourage any advertisers, affiliate marketers, payment processors, and other business partners of Bovada to sever ties to avoid potential licensing or legal consequences.”

The MGCB said Bovada violates at least three state laws:

  • Lawful Internet Gaming Act: This limits online gambling to state-licensed companies. Only casinos sanctioned under the Michigan Gaming Control and Revenue Act or run by Native American tribes under the auspices of federally recognized compacts can apply to offer online sports betting there.
  • Michigan Gaming Control and Revenue Act: This outlaws running a gambling operation without a license issued by the MGCB. Doing so is a felony punishable by up to 10 years of imprisonment, up to a $100,000 fine, or both.
  • Michigan Penal Code: According to the release, this “broadly prohibits any form of gambling, which generally involves the elements of consideration, prize, and chance.”
“Michigan’s actions today are positive for the regulated market against an illegal market that does not face licensure, pay taxes, protect consumers, or have to validate they are doing business with reputable organizations,” Brendan D. Bussmann, Managing Partner at B Global told Gaming Today. “This is one of many steps that other regulators have done previously but it will take a continued effort between states like Michigan and Federal authorities to stop these illegal operators that continue to avail themselves of the law and attack the regulated industry.”

Michigan and other states have recently successfully ordered daily fantasy sites like PrizePicks to cease operations because they were considered unlicensed sports betting operations.

Sports bettor/influencer Jack Andrews told his X (formerly Twitter) audience that he believes Bovada will comply because it’s playing a “long game” and has left other states when conditions changed. in 2021, Bovada left New York citing “the future climate for online gambling in the state of New York,” specifically the legalization of sports betting.

Baird Fogel, a gambling industry expert and partner at Eversheds Sutherland told Gaming Today that Michigan could enlist federal help. And with Curacao “trying to reform its gambling laws to enhance its reputation as a viable and legitimate international host jurisdiction for online gaming,” he said,  Michigan might find an unexpected ally.

“Michigan can sue Bovada under the Lawful Internet Gaming Act, the Michigan Gaming Control and Revenue Act and the Michigan Penal Code. But they can also pursue damages against them under the Michigan Consumer Protection Act and impose stiff financial penalties on Bovada while also forcing them to leave the state,” he said in an email. “Michigan has gotten very good at this kind of enforcement with recent success against other players operating unlawfully in their state including online sweepstakes casinos, Golden Hearts and VGW – as well as fantasy sports operator, PrizePicks.

“With respect to government action, Michigan can also seek help at the federal level to enforce US laws against a foreign operator like Bovada. The US Department of the Treasury, the Department of Justice and the FBI, for example, have several tools at their disposal to implement against offenders like Bovada – including the Wire Act, the Bank Secrecy Act and even RICO. ”

Michigan a Valuable Market for Sports Betting Companies

According to our sports betting revenue tracker, Michigan has generated the ninth-highest handle nationally since its legal market launched in December 2019. Through April, $15.6 billion in wagers had been placed there, creating $1.3 billion in revenue all-time.

However, even with 40 US jurisdictions offering a legal, regulated option, industry observers estimate that illegal offshore bookmakers still absorb as much as 65% of the American market. That makes revenue losses palpable for regulators like the MGCB and its counterparts nationally.

Placing bets with offshore sites is generally not illegal in the United States – although New Jersey regulators have threatened to go after those who do – but accepting these wagers is a crime. In 2017, before the fall of the Professional and Amateur Sports Protection Act made the legalization of sports betting a state decision, Bovada stopped accepting bets from customers in Delaware, Maryland, Nevada, New Jersey, New York, and Maryland.

Still, whether other states can shut illegal sites out remains to be seen. The American legal system has so far been unable to drastically impact offshore operations like Bovada and its scores of illegal competitors doing business in the United States and elsewhere.

There have been individual victories, but those were scored by federal prosecutors with greater reach and resources than state attorneys general. Perhaps the most notable one came nearly a quarter century ago. In 2000, Jay Cohen, the owner of Antigua-based World Sports Exchange, became the first person to be convicted in federal court of violating the Wire Act and was sentenced to 21 months in prison. He was an American citizen living in San Francisco. Subsequent convictions were only possible because offshore gambling moguls returned to American soil or were extradited.

In 2023, a Kentucky woman attempted to launch a class action suit against Bovada without success.

About the Author
Brant James

Brant James

Lead Writer
Brant James is a lead writer who covers the sports betting industry and legislation at Gaming Today. An alum of the Tampa Bay Times, ESPN.com, espnW, SI.com, and USA Today, he's covered motorsports and the NHL as beats. He also once made a tail-hook landing on an aircraft carrier with Dale Earnhardt Jr. and rode to the top of Mt. Washington with Travis Pastrana. John Tortorella has yelled at him numerous times.

Get connected with us on Social Media