How Did An Australian Trader Get BetMGM Fined In New Jersey?

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BetMGM has been fined $25,000 for taking bets on New Jersey college basketball games, in part because an Australia-based trader from Entain failed to recognize Rutgers as an NJ college.

NJ sports betting law forbids betting on college sports events held in the state.

However, BetMGM and its co-parent Entain fell afoul of those rules on two occasions, according to an enforcement document published by NJ Division of Gaming Enforcement last week, first reported by ESPN

Entain provides the technology for the BetMGM Sportsbook and typically creates the betting markets, BetMGM said.

What happened with BetMGM bets?

First on March 10, 2021, BetMGM took two bets on a Metro Atlantic Athletic Conference (MAAC) game between Niagara University and Marist College, due to be played in Atlantic City.

An Entain trader listed the game as taking place in a neutral venue. The location of neutral-site games should then be checked manually or by an automated system. 

However, the system was not working at the time, and no one confirmed the venue against an agreed spreadsheet. The markets was live for around 40 minutes in NJ before being taken down.

The trader responsible was “removed from the trading operations team,” BetMGM said.

What’s a Rutgers?

The second incident happened 10 days later when an Entain trader in Australia created a pre-made parlay that included Rutgers. That trader failed to recognize Rutgers as a New Jersey college and put it live.

The parlay market was up for around eight hours on BetMGM and Borgata before being pulled.

That trader was given a verbal warning and retrained in NJ rules, BetMGM said. The parlays were voided.

BetMGM agreed to a settlement to pay the $25,000 fine.

Was BetMGM undone by bad rule?

The NJ rules around college betting might seem arbitrary, especially with March Madness unfolding.

For instance, motivated bettors could easily cross the New York border to bet NJ-based Saint Peter’s University on Friday.

However, voters had a chance to get rid of the rule last year and rejected it. Twelve other states also ban betting on in-state college games, ostensibly to deter match-fixing.

Local knowledge key

The mix-up also highlights the risks of originating US sports betting markets in another countries.

Penn National recently came under criticism for its plan to build a North America trading team in Gibraltar.