American Gaming Association’s CEO, Bill Miller, has emphasised that the AGA are ‘in for the long haul’ to protect consumers after a new report revealed worrying figures.
Urging the sector to “work together” to fight against illegal and unregulated operators, Miller’s call to action comes after the AGA’s report uncovered that Americans are betting approximately $511bn a year with illegal igaming websites, unregulated machines and sportsbooks.
Conducted by The Innovation Group on behalf of the AGA, the findings of the ‘Sizing the Illegal and Unregulated Gaming Markets in the US’ report noted that the use of these black market operators is currently costing the legal sector $44.2bn in gaming revenue and state governments $13.3bn in lost tax revenue.
Breaking down the above figures, the report showed that Amercans wager an estimated $337.9bn with illegal igaming websites, with a loss of $3.9bn in state tax revenue.
Furthermore, with $13.5bn in estimated revenue, the AGA states that the illegal igaming market in the US is nearly “three times the size” of the legal US sector, estimated to be $5bn in 2022.
Commenting on the report findings, Miller stated: “All stakeholders – policymakers, law enforcement, regulators, legal businesses – must work together to root out the illegal and unregulated gambling market.
“This is a fight we’re in for the long haul to protect consumers, support communities and defend the law-abiding members of our industry.”
The report, which surveyed 5,284 US adults examining their past-year gambling behaviours with both legal and illegal operators, also looked into unregulated gaming machines, including “skill machines”.
It revealed that an estimated 580,651 unregulated machines were in operation throughout the US with 870,000 regulated machines in casinos and slot routes. This has resulted in 40 per cent of all gaming machines in North America being unlicensed.
Based on state regulatory data for similar machines, the operator win percentage on unregulated gambling machines is significantly higher than legal casino slot machines.
During the past 12 months, slot machines in Nevada have a 7.16 per cent win rate, compared to a nearly 25 per cent estimated win rate for unregulated machines.
The report also states that 48 per cent of Americans have played slots or table games with an illegal online casino in the past year.
Survey respondents were asked to indicate how often in the past year they played slots or table games, their average budget when playing these types of games, and what percentage of their play occurred online, at a casino or at distributed locations (e.g., bars, fraternal halls, gas stations, etc.).
Respondents were also asked about their brick-and-mortar slot and table game spend and legal online slot and table game spend in order to identify respondent tendency to over or under report their gambling spend.
Miller concluded: “Illegal and unregulated gambling is a scourge on our society, taking advantage of vulnerable consumers, skirting regulatory obligations and robbing communities of critical tax revenue for infrastructure, education, and more.
“We have always known that the illegal and unregulated market is expansive, but this report illuminates just how pervasive it is.”