Tennessee is yet another state in a long line of states that has filed a cease and desist order against Bovada, a casino and sportsbook operator that doesn't have a license to operate in the US. Bovada has once again failed to comply, and Tennessee had no choice but to issue a $50K fine.

The Tennessee Sports Wagering Council (SWC) imposed $50,000 in fines on Bovada.lv, an unlicensed sportsbook, for illegally operating within the state. The Council's executive director announced the fines on Tuesday following Bovada's failure to comply with multiple cease and desist letters sent to its offices in Curacao. These letters ordered Bovada to cease operations in Tennessee, where it is not licensed to accept sports wagers.

Despite these warnings, SWC investigators successfully placed bets on the platform on three individual occasions, the latest occurring on the 16th of October, 2024. This ongoing illegal activity prompted the Council to issue the hefty fines under the state's Sports Gaming Act.

Breakdown of the fines

The SWC has the authority to penalize sportsbooks for unlicensed activity in the state. Under the Sports Gaming Act, the first violation results in a $10,000 fine, while subsequent violations carry increased penalties. Bovada's second offense incurred a $15,000 fine, and the third resulted in an additional $25,000 penalty. Further violations could lead to more fines, with each illegal wager considered a separate occurrence, potentially leading to additional $25,000 fines for each future bet accepted.

In the cease and desist demand, the SWC not only ordered Bovada to cease accepting bets from Tennessee residents but also required the sportsbook to allow all users from Tennessee to withdraw any remaining funds held in their accounts. Bovada's non-compliance led to the imposition of the fines and further action from the SWC to ensure the safety of Tennessee sports bettors.

Mary Beth Thomas, the executive director of the Tennessee Sports Wagering Council, emphasized the importance of withdrawing funds from Bovada's platform. "The Sports Wagering Council recommends that Tennessee users of Bovada withdraw their funds immediately," Thomas stated. "Our primary role is the protection of the public interest through a safe, regulated environment, and Tennessee sports bettors need to know that just because they can access a sports betting website or app inside Tennessee's borders does not mean it is licensed to do business here."

Protecting bettors in Tennessee

The SWC reiterated the dangers of betting through illegal sportsbooks, like Bovada. Unlike licensed operators, unlicensed platforms may not be able to safeguard bettors' financial and personal information. This information could then be shared with criminal enterprises, putting consumers at risk of identity theft or fraud. Additionally, any funds deposited or won through illegal sportsbooks could be withheld without legal recourse.

The Council is working closely with law enforcement agencies, both at the federal and state levels, to crack down on illegal sportsbooks and protect consumers. The goal is to create a safer and more regulated environment for sports betting in Tennessee, where residents can engage in wagering activities with confidence.

Tennessee's growing sports betting market

Tennessee has emerged as a leading online sports betting market in the US, being the largest "online-only" state for sports wagering. In the last fiscal year alone, more than $4.7 billion was wagered in Tennessee through legal, licensed sportsbooks overseen by the SWC. Licensed sportsbooks are required to comply with strict state regulations that protect consumers, including ensuring that bettors' money is secure and that personal information is safeguarded.

Unlike illegal operators, licensed sportsbooks must also hold reserves to pay out winning wagers and follow guidelines that prohibit individuals under 21 from placing bets. They are also forbidden from offering credit-based betting, another important consumer protection measure.

The widespread problem of illegal sportsbooks

Illegal sportsbooks like Bovada continue to pose a major challenge to regulators across the US. A study by the American Gaming Association estimated that US citizens wager nearly $64 billion per year through illegal online bookies and sportsbooks.

The SWC is committed to eradicating illegal operators from Tennessee's sports betting market, ensuring that only licensed platforms are available to residents. The Council urges consumers to verify the licensing status of sportsbooks before placing bets. A full list of sportsbooks licensed to operate in Tennessee can be found on the Council's official website.