New Jersey Fines BetMGM $25,000 For Taking Illegal College Basketball Bets

Written By Derek Helling on March 25, 2022
BetMGM Gets Fined For Illegal Basketball bets From New Jersey State

When New Jersey voters rejected a chance to bet on in-state college sports events and teams last year, they unwittingly played a part in a situation that’s led to a BetMGM fine. For the most part, however, BetMGM has nowhere to look for the guilty party but in the mirror.

The state says the New Jersey online sportsbook took multiple illegal college basketball bets in the 2021-22 season. That will now cost BetMGM several times more than it potentially made on the wagers.

BetMGM fined for college hoops bets in New Jersey

According to Wayne Parry of KOB4, the bets totaled less than $100. Nonetheless, the fine BetMGM has agreed to pay comes to $25,000. The circumstances seem to dictate a failure in both the sportsbook’s human checks and technology.

Specifically, the bets were on the Rutgers men’s basketball team, and a men’s basketball game between Marist and Niagara universities played in Atlantic City.

On March 10, 2021, the sportsbook accepted two wagers on the Metro Atlantic Athletic Conference tournament game between Marist and Niagara. The NJ Division of Gaming Enforcement says 40 minutes passed before the sportsbook caught the error, voided the bets, and returned the stakes to the users.

Then on March 20, a pre-made parlay created by an Entain employee in Australia included a Rutgers game as one of its legs. In this case, eight hours went by before a BetMGM employee caught the mistake. During that time, two people put a total of $30 on the parlay.

NJ law makes both wagers illegal. The law says that all college sporting events involving New Jersey teams or that take place in the state are off-limits for sportsbooks. The fine acts as a deterrent against future lapses.

BetMGM points to tech issues for lapse

Entain is an equal partner to MGM in BetMGM, and in this case, the finger points to Entain. BetMGM says that Entain normally initiates the creation of betting markets on the app.

In these cases, the technology failed to flag the contests as violating New Jersey law. NJ law also requires online sportsbook operators to employ a manual verification of bets on top of the automated system.

BetMGM says the automated system failed in these instances. It had no comment about a failure of its human verification. That is the element that likely led to this fine. The NJDGE has never been shy about using fines as deterrents.

For example, the same body fined DraftKings $150,000 earlier this year for allowing proxy bets. Whether or not it’s an effective strategy to make an example of rule-breakers is debatable, but violating these laws in NJ is costly.

Photo by Sean Pavone / Shutterstock.com
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Derek Helling

Derek Helling is a lead writer for PlayUSA and the manager of BetHer. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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