Lottery agency backs bill to define illicit interactive gaming, agency says 26 operators are licensed
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Summary
Senate Bill 112 would clarify Maryland law to prohibit interactive online games that effectively operate as illegal gambling and allow enforcement actions; the Maryland Lottery and Gaming Control Agency said 26 entities are lawfully operating while many offshore operators exploit statutory ambiguity.
John Martin, director of the Maryland Lottery and Gaming Control Agency, told the committee that the state treats gambling as illegal unless authorized by statute and that Senate Bill 112 would close loopholes for interactive online games that fall outside current regulation.
"Maryland law assumes all gambling is illegal unless specified by statute," John Martin said. Agency witness Jennifer Bescott described 26 licensed or certified online entities in Maryland — 12 mobile sports wagering licensees and 14 registered fantasy competition operators — and said operators outside that group are operating outside regulation. Bescott explained sweepstakes operators and social‑plus games that convert virtual currency into redeemable value can cross the line into illegal activity when cash considerations are involved.
Industry witnesses including Live Casino and Hotel and trade groups said illegal operators spoof legitimate brands, evade cease‑and‑desist efforts by changing domains, and deprive the state of tax revenue and consumer protections; Live Casino and Hotel urged enforcement rather than broad legalization. The Lottery agency said it has sent 75 cease‑and‑desist letters with roughly a 33% success rate in getting operators to cease activity or leave the state.
Committee members sought clarification on whether compliant operators would be affected or whether regulation rather than prohibition would be preferable. Jennifer Bescott and John Martin said the bill aims at operators outside the 26 licensed entities and that those who wish to operate legally can apply for licensure.
