Worrying findings for state regulator
New Jersey’s gaming regulator, the New Jersey Division of Gaming Enforcement (NJDGE), has called out the state’s online gambling operators after an investigation into withdrawal processes. The regulator found some operators were encouraging customers to cancel cash outs.
The NJDGE confronted the matter in a Director’s Advisory Bulletin on Wednesday, citing “patron complaints regarding the processing time for withdrawals.” Although the regulator recognized operators required some withdrawal delay to process checks, the NJDGE said the number of complaints necessitated an investigation.
encouraged customers to cancel their withdrawals, sometimes offering bonus money
In this investigation the regulator found some operators contacted customers in the time between the withdrawal request and the release of funds. The operators encouraged customers to cancel their withdrawals, sometimes offering bonus money as an incentive to do so. The regulator warned of legal action if operators continued with the activity.
What does current law dictate?
In its bulletin, the NJDGE set out current New Jersey law relating to withdrawals. Although current law does permit withdrawal cancellations, the regulator outlined how the activity of certain operators had broken the rules regarding this practice.
Cash out delays are permitted to give operators the necessary time to carry out fraud, theft, and anti-money laundering checks. However, the law prohibits “unnecessary delay,” according to the regulator. The NJDGE said it expects operators to process withdrawals as soon as checks are complete. Current law does not dictate a specific time frame.
prohibit the practice of soliciting…the rescission or reversal of withdrawals”
The regulator said any attempt to incentivize withdrawal cancellations directly transgresses state law. The bulletin read: “Current rules, taken as a whole, prohibit the practice of soliciting, either overtly or covertly, the rescission or reversal of withdrawals once requested by a patron.”
In the bulletin’s conclusion, the NJDGE threatened “regulatory action” and “civil penalties” for anyone practicing the activity moving forwards. The regulator did not name any specific operators in the statement.
New Jersey’s 2020 gaming performance
The NJDGE has a difficult task regulating one of the most profitable gambling markets in the US. Although it was a tough year for the land-based gambling industry, 2020 still saw a strong performance from the Garden State because of its fast-growing online markets.
Earlier this week, New Jersey unveiled its gaming revenue report for December.?Internet gaming win totaled $99.5m – a steep rise of 102% compared to 2019’s figure. Meanwhile, the state’s sports betting operators generated handle of $996.3m for the month. December was the fifth consecutive month in which New Jersey sports betting handle hit an all-time US monthly high. Sports betting revenue totaled $66.4m for the period.
Despite growth in sports betting and online gaming, New Jersey’s overall gaming revenue was still down 17% for the full year. Demonstrating the continued impact of COVID-19 restrictions, retail casino win was down almost 30% in December.