Online sports betting company BetMGM will pay the Maryland Lottery and Gaming Control Commission $146,000 to settle alleged violations of the Sports Wagering Law, the largest consent agreement the commission has ever approved.
On Nov. 16, BetMGM accepted mobile wagers before the company was granted a Maryland license. There were 146 mobile wagers made over three hours after a mistaken change in the configuration of the beta website allowed people to bet online prematurely.
Each of the gamblers had their bids voided and their money returned, with the exception of one person who had already withdrawn their winnings.
The commission voted to approve the agreement in a meeting Thursday.
Rhea Loney, chief compliance officer at BetMGM, said the company acted immediately after discovering the error, working with their geolocation vendor to make sure no one in Maryland could place additional bets.
“We worked also with the commission with getting a report to you all and launched an investigation, a technical investigation, to find out how this occurred,” Loney said.
Roman Rubas, BetMGM’s director of technical governance, told the commission that BetMGM teams were making changes to the beta site, which is hidden from the public, to do final checks. One of those changes led a link to redirect, letting customers place wagers rather than landing on a page saying betting would be coming soon to Maryland.
“So it was human error, not technical malfunctioning?” Commission Chair Randolph Marriner said.
“Right, it was configuration,” Rubas said. He said BetMGM had put internal processes in place to prevent the same issue from happening again and was working with the geolocation provider to block bids in places where wagering had not yet launched.
BetMGM did not immediately respond to a request for comment Thursday afternoon.
Previously, the highest payment for a consent agreement, which avoids a formal hearing where a penalty or fine could be applied, was $5,000, Maryland Lottery and Gaming spokesperson Seth Elkin said. The agreement with BetMGM was first reported by the sports betting website BetMaryland.com.
In Thursday’s meeting, Commissioner Harold Hodges questioned whether the penalty was appropriate for a company operating without a license.
“It may be the largest penalty levied against a company. I see that as no more powerful than a slap on the hand, the wrist,” he said. “I think if anything, they should have their license withdrawn.”
The commission has the authority under state law to impose penalties of up to $5,000 for each violation, Elkin said. It also has the ability to revoke an entity’s gambling license.
“This appears to be an inadvertent mistake. It’s also the largest penalty we’ve ever issued to anyone here at Maryland Lottery,” Marriner said. “We treat this very seriously. Where $146,000 might not sound like a lot of money, it’s a lot of money.”
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