Borgata Casino in New Jersey has recently been hit with a $75,000 fine by the New Jersey Division of Gaming Enforcement due to an error in its Internet Gaming Promotional Gaming Credits (PGCs). The casino, operating through its BetMGM platform, overstated its PGCs by over $4.5 million from October 2023 to May 2024, resulting in a gross revenue tax underpayment of more than $365,000 on its last filing in June 2024. This overstatement was attributed to a software upgrade by BetMGM, causing PGCs to be deducted in an amount greater than the actual bonuses awarded.
This is not the first time Borgata has underpaid taxes, as they had a similar incident in March 2023 where they overstated their PGCs by $9.8 million, leading to a $787,000 underpayment. Despite not being fined in 2023, the New Jersey Division of Gaming Enforcement warned Borgata that any further transgressions could result in financial penalties. The repetition of the mistake was one of the factors leading to the $75,000 civil penalty imposed on Borgata this time.
Mary Jo Flaherty, Interim Director of the Division of Gaming Enforcement, emphasized the seriousness of the matter, highlighting the significant understatement of gross revenue in both instances. She noted that the errors were rectified promptly but pointed out that a civil penalty was warranted given the circumstances. Flaherty also mentioned the busy year for the regulator, with several operators facing penalties for regulatory violations.
In July, DraftKings received a $100,000 fine for misreporting the amount of money wagered on parlay bets, which was attributed to a coding error in a new database. FanDuel also faced a smaller fine of $2,000 for taking bets on pre-recorded MMA fights billed as live events. Additionally, Bet365 had to pay out over $500,000 to bettors after voiding wagers posted with incorrect odds.
Overall, the New Jersey Division of Gaming Enforcement is actively monitoring operators to ensure compliance with regulations and penalize any violations. The recent penalties imposed on Borgata and other operators serve as a reminder of the importance of accurate reporting and adherence to gaming laws in the state of New Jersey.