G2E Panel Details Regulatory Variations That Allow Illegal Gaming to Undercut Licensed Operators

Panelists at the Global Gaming Expo examined the struggles legal operators face competing against illegal and gray market gaming. The discussion titled Illegal and Gray Markets: Consumer Harm and Market-Integrity Risks featured regulators and experts from multiple jurisdictions.

Defining Legal and Illegal Gaming in Practice

Dawn Himel, director of the Louisiana Attorney General office’s Gaming Division, asked how one can know if an emerging market is genuine or illegal. Antony Geviser, Super Group’s director of legal and regulatory affairs International and Africa, said operating lawfully can mean applying for a license in a clear regulatory market. In gray markets it can mean holding a legally defensible position supported by expert advice from local lawyers.

Cyrus Pitre, Pennsylvania Gaming Control Board’s chief enforcement counsel, outlined a binary approach. Markets are either authorized by the government or unauthorized. Authorized categories include interactive gaming slots, tables, poker, fantasy contests, video game terminals at truck stops, land-based casinos and sports betting.

Christian Rapani, a partner with Rapani Rechtsanwälte GmbH, described Austria’s framework. Betting is regulated at the state level with nine different state betting laws, even though we only have eight million inhabitants. One supreme court case permitted a foreign operator without a Styria license to continue after a 2018 law amendment allowed an unregulated market.

Pitre reviewed Pennsylvania skill game rulings. A 1983 supreme court decision required consideration, reward and chance for an illegal gambling device. This left skill games outside the Gaming Act until in June this year the state Supreme Court ruled that skill games are illegal slot machines and the games must be removed by October 13.

Enforcement Realities and Competitive Harm

Harold Mays, director of the Illinois Department of the Lottery, said legal operators sometimes surrendered licenses to install more lucrative skill games. Between 40,000 and 70,000 skill games operated in Pennsylvania against 25,000 legal slot games. The Commonwealth and gaming industry lost billions of dollars over roughly 12 years.

Mays described enforcement as requiring both compassion and direct action. He called the process a pain in the ass. As reported by CDC Gaming the examples illustrate persistent gaps that harm licensed markets.

These jurisdictional differences create openings for unauthorized operations that erode revenue and consumer protections. Regulators must pursue timely clarifications and uniform standards. Licensed operators cannot compete sustainably until enforcement closes the gaps that favor illegal activity.

Reporting: CDC Gaming

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