Connecticut Bans Bovada to Protect Online Casino Operators

In a decisive move to protect its legal online gambling market, Connecticut has barred the illegal offshore online casino and sportsbook operator Bovada from operating within the state. The Connecticut Department of Consumer Protection, under the leadership of Director of Gaming Kristofer Gilman, issued a cease-and-desist letter to Bovada in mid-June, demanding an immediate halt to its services and ensuring customers could withdraw their funds. This action underscores the state's commitment to safeguarding consumers from unregulated gaming and bolstering its licensed online casino operators.

 

Key Points

• Bovada ceased operations in Connecticut following regulatory action.
• Connecticut joins nine states and the District of Columbia in banning Bovada.
• Offshore sites cost states billions in tax revenue.
• Connecticut's ban is significant as it is one of only seven states with active online casinos.
• Regulatory Action and Its Rationale

Connecticut's gaming laws are clear: only operators with a state-issued license can offer online gambling services. Bovada, operating without such a license, violated these regulations. The cease-and-desist letter from the Department of Consumer Protection explicitly ordered:

“Bovada is hereby ordered to immediately cease and desist offering its games and services to Connecticut customers.”

This directive not only aimed to halt Bovada’s operations but also to protect customers' funds, ensuring they could withdraw their money without complications.

Connecticut's action is part of a broader national crackdown on Bovada. Recently, West Virginia issued a similar cease-and-desist order, with Lottery Director John A. Myers emphasizing potential legal and financial repercussions for non-compliance. This follows bans in states such as Michigan, a leading online casino market. Bovada’s increasing list of restricted states reflects a growing consensus among regulators to curb illegal offshore gaming.

Illegal offshore sites like Bovada, despite their legal status, continue to attract users through aggressive advertising campaigns. These promotions can mislead bettors, especially those new to online gambling, into believing these sites are legitimate. However, unlike their regulated counterparts, offshore sites often lack stringent security measures and standards, exposing customers to significant risks, such as unpaid winnings and data breaches.

Furthermore, the prevalence of illegal gambling platforms results in substantial tax revenue losses. According to the American Gaming Association's 2022 report, states miss out on approximately $4 billion annually due to unregulated offshore sports betting and online casinos.

Bovada’s exit from Connecticut is likely to benefit the state’s legal online casinos, potentially leading to increased activity on these platforms. While precise impacts are hard to measure immediately, examining revenue data from July may provide insights, as Bovada likely ceased operations in late June. Typically, iGaming revenue experiences seasonal fluctuations, declining after winter and rising in the fall.

 

“Bovada is hereby ordered to immediately cease and desist offering its games and services to Connecticut customers.”

 

Conclusion

Connecticut's ban on Bovada marks a significant step in the state's efforts to regulate online gambling and protect its residents. By eliminating unlicensed operators, Connecticut aims to ensure a secure gambling environment and support its legal online casino market. This action aligns with broader national efforts to mitigate the impact of illegal offshore gaming and recover lost tax revenue. As other states follow suit, the landscape of online gambling in the U.S. may see more stringent enforcement and clearer distinctions between legal and illegal operators.