BetMGM issued $146k fine in Maryland for taking bets illegally

BetMGM has been fined by the Maryland Lottery & Gaming Control Commission for taking bets before it had been issued a license in the state.
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BetMGM has been issued a fine by the Maryland Lottery & Gaming Control Commission for taking bets before it had been issued an online sports betting license in the Old Line State.

During a recent meeting, the commission explained that on November 16, BetMGM’s website took 146 wagers over the space of three hours in the state of Maryland, a week before it had been issued a license to operate in the state.

Maryland did not go live with its online sports betting market until November 23. BetMGM quickly voided all the bets made and returned the wagers back to the customers who made them.

However, the state commission is not happy that bets were allowed to be made before the market launched. As a result, it has fined BetMGM $146,000 for the violation – $1,000 per bet accepted – which is the biggest fine the commission has ever handed to one of its operators.

One commission member in the meeting, Harold Hodges, was not happy with the fine BetMGM was given, calling it a “slap on the wrist” rather than a meaningful penalty, and proposed withdrawing the operator’s license until the commission decides on an approach to make sure such a problem in the future doesn’t occur again.

BetMGM’s Chief Compliance Officer, Rhea Loney, and Director of Technical Compliance, Roman Rubas, were also present during the recent commission meeting to explain what happened.

Loney stated: “This has never occurred in any of MGM’s prior launches in any states, so this is an isolated occurrence for BetMGM.” She added that Maryland regulators were notified as soon as the issue was identified. The operator also launched its own technical investigation into the matter.

Rubas explained that the issue occurred during BetMGM’s beta testing period for its app ahead of the operator’s controlled demonstration for the Lottery & Gaming Control Agency the following week.

“Essentially, what happened was one of those links got redirected in production,” he stated. 

“Once a player went through, was KYC-verified … instead of being brought back to the splash page that said ‘It’s showtime. You’ll be able to wager soon’, it was actually redirected to the sportsbook. 

“Since then, we’ve actually took this as a ‘lessons learned’, we’ve worked with our geolocation provider so that, new states that are coming on board, we’re going to ensure that those states are in the exclusion zone, they won’t allow any wagers to get through.

“Our own internal processes are going to be in place to make sure that this doesn’t happen again, as well as using our geolocation provider to ensure that no wagers get through as an additional precaution.”

When asked by the commission’s Chairman Randy Marriner to clarify if this had been a “human error, not technical malfunction”, Rubas confirmed as such.

“It was configuration. So somebody went to configuration and that’s what caused the sportsbook to be exposed.”

Despite opposition from Hodges to explore the issue further to stop it from happening again in the future, every other member of the commission voted in favor of fining BetMGM $146,000 for their violation.

BetMGM has also recently been jointly fined $7,500 with the Mountainview Thoroughbred Racing Association by the Pennsylvania Gaming Control Board (PGCB) for accepting bets on an unapproved sporting event.

The Pennsylvania fine was determined through a consent agreement presented by the Board’s Office of Enforcement Counsel (OEC), a result of negotiations between OEC and Mountainview Thoroughbred Racing Association, operator of Hollywood Casino Morgantown in Berks County and its sports wagering partner BetMGM.