Tennessee sports betting regulators are ordering offshore sportsbook BetOnline to stop taking bets in the state, the latest in a growing national effort to curb illegal gambling.
The Sports Wagering Council issued a cease and desist letter to the Panama-based sportsbook on Tuesday, giving it until June 16 to withdraw from Tennessee. The website does not have a TN sports betting license and does not pay the state’s required taxes or licensing fees.
“Shuttering illegal sportsbooks will benefit the legalized market, our licensed operators and the public good in Tennessee, but illegal offshore sportsbooks are not going to go away easily,” SWC Executive Director Mary Beth Thomas said in a statement. “We envision a Tennessee where all sports wagers are legal, and we’re working closely with our network of law enforcement at the state and federal levels to make that vision a reality.”
Tennessee sports betting crackdown
The cease and desist letter is part of an ongoing enforcement campaign from the SWC, which has issued $200,000 in fines across April and May to unlicensed offshore operators including BUSR, BetUS, MyBookie, and Xbet. Bovada left the state in November, after paying a $50,000 fine.
More recently, the state also sent cease and desist letters to Sportsbetting.ag and Lowvig.
The SWC is authorized to fine illegal operators up to $25,000 per offense, with each individual wager potentially qualifying as a separate violation under the Tennessee Sports Gaming Act.
Tennessee regulators have also warned that any in-state businesses working with unlicensed sportsbooks could face criminal penalties.
BetOnline out in Michigan
Earlier this month, Michigan regulators issued a similar cease and desist order to BetOnline, part of that state’s broader campaign to disrupt more than 40 offshore operators.
BetOnline, which has operated without a license for years, is not subject to any of Tennessee’s sports betting requirements. That includes the state’s 1.85% tax on handle and a $750,000 annual licensing fee.
Offshore sportsbooks may also offer prohibited bet types, such as college player props, and allow users to wager on credit, bet while underage, or with cryptocurrency.
Prediction markets disrupt TN sports betting
The cease and desist actions come as Tennessee expands its calls for federal help policing unlicensed gambling.
Earlier this month, the SWC sent a letter to the Commodity Futures Trading Commission urging it to prohibit sports prediction markets like Kalshi and Robinhood from serving Tennessee residents, calling the products unlicensed wagering.
It is one of nine states to raise legal concerns with the rapidly expanding quasi-regulated event contract trading sector, while the CFTC remains silent.
The American Gaming Association estimates US bettors place roughly $64 billion annually with illegal sportsbooks. The IRS pegged the market’s size around $700 million just before the start of the 2023 NFL season.
