Illegal casinos are all over the world, from phsycal backrooms to online casinos. Governments with regulated casino markets try to desperately take them down. However, just in the USA it is a multy billion dollar business. All for which there is no gambling license required, no taxes are paid, or anti gambling addiction measures are taken. But how does the illegal gambling market operate? What are the earnings? And how do online casinos play into this? Read about all of this in our QMRA blog about Illegal casino USA!
Illegal Casino USA: The basics
Before you are able to find out how illegal casinos operate, it is imperitive to know what illegal casinos are. Every jurisdiction will have their own nuances on what an illegal casino is. In America on a federal level under 18 U.S. Code § 1955 an illegal casino, or illegal gambling business, is a business meeting the following three criteria:
- It violates the laws of the state or political subdivision where it’s located;
- It involves at least five people who finance, own, or conduct the business; and
- It operates for at least 30 consecutive days and generates gross revenue of at least $2000 on any of those days.
These are the criteria the federal government upholds for what constitutes as an online casino. On a state level, every state can implement their own regulations, as long as these three basic criteria are the minimum. However this only applies when the state has a legal gambling market, either online or offline. When this is not the case the rules differ. As some states just outright ban all forms of gambling, such as Hawaii and Utah, making their rules on what is or is not an illegal gambling operation stricter. All other states do allow some sort of gambling, mostly loteries and a form of physical casino. Through the years more states have opted to make online casinos legal. But only 7 states have actually allowed it. Online sports betting is legal in many more states. You can check an interactive map of the legality for online gambling here.
How much is illegal gambling worth?
As briefly stated the illegal casino USA market is worth many billiones of dollars. But how much s it worth? Well in anyu case these are always estimates. If the US government would know how much exactly there is earned, they could have taxed them. The estimation goes that around 511 Billion dollars go to illegal gambling. Costing the IRS around 13.3 Bilion dollars in taxes. The estimation is structured as follows:
- Sportsbetting: 63.8 Billion
- Online slots and table games: 337.9 Billion
- Unregulated machines: 109.2 Billion
Sportsbetting are mainly illegal bookies and ofshore gambling such as unregulated sportsbetting websites and apps. Online slots are illegal online casinos and table games are illegal online table games and backroom table games. Unregulated machines are slotmachines which are placed in backrooms. In any case the market is booming and only set to increase over the coming years, making the problem of protecting consumers only worse.
What are the associated risks of illegal online gambling?
In many cases consumers won’t see a problem with illegal gambling. When it considers online gambling, in many cases they won’t even notice that what they are doing is illegal. The following is a non-limitative list of risks consumers can be the victim off, when partaking in illegal online gambling:
- Financial losses
- Fraud and scams
- Lack of consumer protection
- Organized crime & legal consequences
Financial losses
Of course when going to a casino you should expect to lose your money instead of winning. The real winner is always the house. However, illegal casinos will market much higher prices, but the stakes are much higher as well. Illegal casinos do not adhere to any regulation regarding financial safety. The stories about people getting into debt by taking loans they can never repay is very real. A legal casino can never offer you a loan to play at the casino. So called ‘loansharks‘ are only there to make you poor faster.
Fraud and scams
Fraudulant practices are not new, nor are they new in the casino business. Games and bets can be rigged more easily. Systems can be rigged to make winning or even paying out impossible.
Lack of consumer protection
Basically the last two points also adhere to this one. But lack of consumer protection is more than this. It also considers lack of protection against gambling addiciton. Illegal casinos will not put the efford and financial means in a comprehensive anti addiction system as legal casinos will. Especially for the online market this is a huge problem, as the customer service will be unavailable. Not that in landbased illegal casinos there will be much help.
Organized crime and legal consequences
When something is illegal, crime is automatically involved and gambling is no different. Organized crime rings will have a piece of the pie and can be worth billions. Getting into this worth, can cause a whole lot of trouble. Especially if you get into debt, these organizations will not hesitate to take everything you have. It is also good to consider that as a player, you are also operating illegally and can be charged.
At QMRA we strive to have players only play at the regulated gambling offer. Our member affiliates are always adhering to the highest standards of laws and regulations and only offer legal gambling offers. Want to know more about the gambling market, landbased or online? Than read more on QMRA.eu!
