Black Hawk, Colorado casino executives recently discovered that three of their sportsbook employees were making proxy bets on behalf of customers. This was self-reported by the casino, Monarch Casinos & Resorts.
The fine would be $400,000 if regulators accept the settlement offer. This would be the largest fine to a Colorado casino operator since gambling became legal in 1991.
Proxy betting is illegal in most states and is subject to fines. It is legal in Nevada, but sports betting account owners must register information with a regulated proxy service.
Sportsbook employees made a total of 79 proxy bets for 11 separate customers totaling almost $61,000. This ranged from Jan. 2021 through June 2022.
Of the 79 bets, 19 of them were in person at the Colorado casino sportsbook. The other bets were via the BetMonarch online app.
What is proxy betting?
A proxy bet is when an individual other than the owner of the betting account places a bet on behalf of a customer. It’s that simple. It presents many problems for customers, operators and regulators alike.
Customers risk losing their money by the “proxy” bets being placed incorrectly. And most importantly operators could shut down their accounts for breaking terms of service.
Operators must protect customers and their money, so fines make sense and operators take offenses seriously.
In 2022 New Jersey regulators fined DraftKings $150,000 for allowing a proxy bet. A Florida customer placed a $50,000 bet via a friend in New Jersey while he was out of state. As a result, the man had 21 bets voided and had his account closed for proxy betting.
In the same year, Mustang Sally in South Dakota along with one of its employees lost their gaming licenses for illegal practices. One of those practices involved placing proxy bets for multiple customers. Regulators fined the operator a maximum of $25,000.
Regulators have a straightforward job and are looking out for customers and operators alike.
Nevada allows proxy betting as long as bettors use an approved proxy service. Some of the proxy service companies available include:
- Vegas Football Proxy Services
- Circa Contest Proxy Service
- Winners Circle
Monarch Casinos could face the largest fine in Colorado casino history
With their settlement offer of $400,000, Monarch Casinos & Resorts could be hit with the biggest fine given to a Colorado casino operator in the state’s history.
Golden Gaming, now operating as Golden Entertainment, got a $270,000 fine in 2005. Accounting irregularities were found when they were the previous owners of three Black Hawk casinos.
Regulators dished out the largest overall fine within the state in 1997 to Aristocrat Technologies, a slot machine developer. Authorities reprimanded them for misrepresenting the value of their machinery to dodge a higher tax bracket.
The $400,000 figure is merely a settlement offer from Monarch for the time being. The Colorado Limited Gaming Control Commission still needs to agree to the offer and they should handle it soon.