Michigan Regulator Orders Bovada to Cease Operations in the State

The Michigan Gaming Control Board (MGCB) has issued a cease-and-desist order against Bovada, a Curaçao-based online gaming operator, for allowing Michigan residents to access its games without proper licensing. Following an investigation, the MGCB sent a cease-and-desist letter to Harp Media BV, the operator of Bovada.com and Bovada.lv, on May 29.

Harp Media BV has been accused of infringing upon multiple Michigan laws, including the Lawful Internet Gaming Act, the Michigan Gaming Control and Revenue Act, and the Michigan Penal Code. According to these regulations, only federally authorized tribal casinos and casinos licensed under the Michigan Gaming Control and Revenue Act are permitted to apply for an online gaming or sports betting license in the state.

Running an unlicensed gambling operation in Michigan is considered a felony, with potential punishments of up to ten years in prison, fines up to $100,000, or both. The MGCB has given Harp Media BV 14 days from the receipt of the order to block Michigan residents from accessing its services. Failure to comply will result in legal action from the MGCB.

Henry Williams, the executive director of the MGCB, emphasized the significance of this order as a warning to other international operators. “The proliferation of online gaming platforms has led to increased scrutiny from regulatory bodies worldwide, and this action serves as a stern warning to overseas companies that flouting local regulations will not be tolerated,” Williams said.

He added, “The MGCB remains steadfast in its commitment to upholding Michigan’s laws and regulations and will continue to actively monitor and enforce compliance within the state to ensure a fair and secure gaming environment for all.”

The MGCB urges residents to exercise caution when engaging in online gaming activities and to verify the legality of gaming sites before participating. A list of licensed internet gaming providers is available on the MGCB’s website. Residents are also encouraged to report any suspicious or unlicensed gambling operations to the MGCB for prompt investigation and action. Tips can be reported by calling 1-888-314-2682 or sending a message to MIGamblingTip@michigan.gov.

Bovada’s operations are based in Curaçao, which is currently undergoing significant reforms in its gambling legislation. The country is awaiting the implementation of the National Ordinance for Games of Chance (LOK), a new regulatory framework designed to improve the industry’s reputation.

Curaçao has historically been criticized for its lax anti-money laundering (AML) regulations and association with criminal activities. The LOK aims to replace the existing National Ordinance on Offshore Games of Hazard (NOOGH) and provide a “safety net” against grey-listing by the Financial Action Task Force (FATF), according to Javier Silvania, Curaçao’s Minister of Finance.

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This regulatory action comes at a time when Michigan’s gaming industry is experiencing fluctuations. In April, the state reported an 8.7% decline in online gaming revenue, with sports betting and igaming operators recording $234.8 million in revenue, a month-on-month decrease. Additionally, Detroit’s casinos saw an 11.7% drop in revenue for April, totaling $109.4 million.

The MGCB’s decisive action against Bovada underscores the state’s commitment to maintaining a regulated and lawful gaming environment, safeguarding the interests of both operators and players within Michigan.

Source:

Michigan Gaming Control Board issues cease-and-desist letter to Bovada, michigan.gov, May 30, 2024.