Offshore online gambling companies are trying to cash in on New Jersey's recent legalization of Internet betting.
State regulators won't name any of the companies in question or definite how many there are, but say they're aware of the issue. The offshore companies are attempting to entice New Jersey residents into playing on their sites without having received proper licensure from the New Jersey Division of Gaming Enforcement, officials said.
Online wagering launched in November 2013. State law requires that online gambling companies must receive approval from the division and must reach a partnership with a land-based casino in Atlantic City. That provision, lawmakers said, would help ensure already-struggling casinos would benefit from online gambling operations.
"The division is aware of this issue and is taking steps to coordinate an appropriate response to this illegal activity," DGE spokeswoman Kerry Langan said.
She declined to elaborate on plans for that response.
The Casino Control Act mandates that companies offering online gambling to New Jersey residents must be licensed by the state. Criminal penalties can be imposed for such violations, Langan said.
Companies operating legally in the state are also aware of the issue. Officials with Bwin.party, which has partnered with Borgata Hotel Casino & Spa, recently told investors during a conference call that offshore operators are running promotions in attempts to attract New Jersey customers.
The DGE has authorized seven casinos to offer Internet gambling in conjunction with their partners. Those casinos are permitted to operate multiple websites. Sixteen websites have been approved and are listed on the DGE's website, but gamblers would have to seek out that list to check if a site is approved.
The government has made attempts to crack down on illegal operations. In 2006, the Unlawful Internet Gambling Enforcement Act was signed, prohibiting banks from processing online gambling payments, though some companies found ways to operate.
In April 2011, the U.S. Department of Justice indicted some of the largest online poker operators, who were charged with multiple violations of the federal act among other charges.
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