BetMGM Fined $146K for Accepting Online Sports Bets Too Early in Maryland

State regulator calls Nov. 16 incident “an inadvertent mistake” but also a serious one. It imposed a $1,000 fine for each of the 146 wagers accidentally processed during a pre-launch testing period.
a man in a grey suit is seen from the neck down. he holds a red penalty card towards the camera.
By
December 19, 2022

We’ve implemented measures to ensure, in additional state launches, that this will not occur again. Maryland regulators issued a $146,000 fine, the largest in state history, against BetMGM for accepting real money US sports betting wagers one whole week before the official launch date.

Despite the record fine, at its meeting Thursday, members of the Maryland Lottery and Gaming Control Commission (MLGCC) voted in favor of a consent agreement with BetMGM — sparing the operator from a formal hearing on the matter and potentially more considerable fines.

“This appears to be an inadvertent mistake,” MLGCC Chairman Randy Marriner said moments before the Commission voted in favor of the consent agreement. But he added, “it’s a serious mistake.”

Link Prematurely Connected to Live Sportsbook

Seven operators, including BetMGM Sports, were cleared by the regulator to launch mobile sports betting on November 23, the day before Thanksgiving. A two-day soft launch period — where the MLGCC conducted oversight of a series of controlled demonstrations — began on November 21.

However, it was revealed during Thursday’s meeting that, for a three-hour window on November 16 — one whole week before the official launch date — players were able to place 146 wagers on BetMGM Sportsbook MD.

Regulators ultimately fined BetMGM Sports $1,000 for each illegal wager.

“At the time, we were going through our checks for the controlled demo that was going to occur the following week,” Roman Rubas, Director of Technical Governance for BetMGM, told commissioners during Thursday’s meeting. “The teams were making configuration changes to the beta site, which is hidden from the public. It gives us the ability to do our final checks and sign off, and make sure everything is working.

“Essentially, what happened was: One of those links got redirected in production, so once a player went through and was KYC verified, instead of being brought back to the splash page that said 'It’s showtime! You’ll be able to wager soon,’ they were actually redirected to the sportsbook.”

BetMGM Compliance Officer Rhea Loney told the Commission that the operator took the situation seriously.

“We’ve implemented measures to ensure, in additional state launches, that this will not occur again,” Loney said. “This has never occurred in any of BetMGM’s prior launches in any states, so this is an isolated occurrence for BetMGM.”

But the Commission was not unanimous in approving the consent agreement. Commissioner Harold Hodges said the entire affair raised serious questions about whether the state’s gaming laws were being taken seriously and whether BetMGM should continue holding a license.

“From my perspective, even though $146,000 may be the largest penalty that we’ve ever levied against a company, I see that no more powerful than a slap on the wrist, frankly.”

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BetMGM Got Fined in Pennsylvania, Too

The day before it received its fine in Maryland, BetMGM had received another one for $7,500 in neighboring Pennsylvania.

According to the Pennsylvania Gaming Control Board (PGCB), BetMGM Casino PA accepted and paid out wagers on a boxing match between Victor Belfort and Evander Holyfield that was held on September 11, 2021. The bets occurred despite the PGCB notifying operators ahead of the fight that wagering on the event would not be permitted.

At its monthly meeting on Wednesday, the PGCB approved a separate consent agreement with BetMGM and the Mountainview Thoroughbred Racing Association, which operates Hollywood Casino Morgantown and is BetMGM’s partner in the state. As part of the agreement, the PGCB levied a $7,500 fine against BetMGM.

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