Proxy SD Sports Betting Leads Two To Lose Gaming Licenses

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SD sports betting

A casino and one of its employees have lost their South Dakota gaming licenses because of illegal SD sports betting.

The owner of Mustang Sally‘s in downtown Deadwood admitted to multiple instances of illegal gambling at the South Dakota Commission on Gaming‘s meeting Wednesday.

“I’m incredibly sorry for my bad judgment,” Toby Keehn told the commission according to KELO-TV.

Both Keehn and Haefs were accused of illegal South Dakota sports betting practices from launch last September through August 2022.

Commission: multiple SD sports betting violations

Haefs was accused of placing proxy bets for multiple people, including Keehn, according to commission documents.

Along with having a proxy place bets for him, Keehn also allegedly extended credit and illegally placed bets for himself and others at Mustang Sally’s. The casino lost its operator and retail licenses, and was fined the maximum $25,000.

Haefs did not testify. Keehn acknowledged he cannot undo his actions and said it “definitely would never happen again.”

Both placing proxy bets and extending credit are Class 6 felonies in South Dakota. Those could result in up to two years imprisonment and a $4,000 fine.

SD sports betting numbers since launch

South Dakota is the fifth-smallest state in the US with under 1 million residents. That combined with the fact that sports betting is only available at retail casinos in Deadwood means much lower sports betting revenue than other states.

South Dakota casinos reported $6.7 million in handle for the first 12 months of operation. An 8.4% hold means operators kept $555,502 in revenue.

The state taxes gambling at 9%, which led to $50,000 in sports betting taxes paid over the first year.

Mobile shot down earlier this year

The fact there is no mobile sports betting in South Dakota is not from a lack of effort.

A mobile betting bill made its way through the Senate last year but was defeated in the House. It was in the House where Department of Revenue Deputy Secretary David Wiest equated legalizing mobile betting to murder and theft.