New Jersey and New York: Hotbeds of Black Market Sports Betting

online sports betting

Despite the legalization of sports betting in 38 states and Washington, DC since the 2018 Supreme Court ruling on the Professional and Amateur Sports Protection Act (PASPA), black market betting remains a significant issue in certain states.

According to recent data from the Campaign for Fairer Gambling (CFG), New Jersey and New York continue to experience high levels of illegal iGaming and sports betting activity. The latest report from Yield Sec highlights that $40.92 billion in wagers were placed through unregulated internet casinos and sportsbooks. Among these, bettors in Minnesota, New Jersey, and New York accounted for $9.5 billion.

Minnesota’s presence on this list is somewhat expected as the state does not allow iGaming or sports betting. However, the substantial black market activity in New Jersey and New York, where both forms of wagering are permitted, is alarming. Notably, New York holds the highest regulated online sports betting handle in the country.

Federal Oversight as a Potential Solution

CFG’s Webb advocates for increased federal oversight to address black market betting.

Federal involvement could potentially enhance consumer protection and increase state tax revenue. Nonetheless, the ongoing black market betting in New Jersey and New York challenges the notion that legalization alone can eliminate illegal betting activities.

Alarming Black Market Betting Statistics

In Minnesota, approximately $1.5 billion was directed to unregulated iGaming forums, and $929 million was spent on illegal internet sportsbooks. These figures are concerning but pale in comparison to the statistics from New Jersey and New York.

In New Jersey, where both iGaming and online sports betting are legal, nearly $1 billion was wagered with local bookies and illegal online sports betting sites, and an additional $719 million was spent on unregulated online casinos.

In New York, despite some politicians advocating for the legalization of iGaming, residents still spent $3.4 billion on unregulated internet casinos and $1.9 billion on illegal sportsbooks, according to CFG.

These figures underscore the persistent challenge of combating black market betting, even in states with legal wagering frameworks.

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