KGC Licenses No Longer Include US Sites

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Tuesday, October 18th, 2016 | Written by Charles Washington

Online poker is illegal in all but three states in the U.S., but that doesn’t mean that people outside of New Jersey, Nevada and Delaware are unable to find a seat at the virtual gaming tables.

Ever since 2011 when online poker was banned in the United States, operators located outside of the country have been taking advantage of a work around in order to provide iGaming access to Americans. In Canada, the Kahnawake Gaming Commission (KGC) has used its status as a tribal organization to extend licenses to foreign operators, with many of these companies then turning around and marketing their sites in the U.S.

However, the loophole that allowed many of these illegal online poker sites to remain open has now been closed. The Kahnawake Gaming Commission issued a statement at the end of September that they would no longer license operators that have been targeting U.S. players. In the statement, the KGC advised those operators who were already licensed through by the commission that they would need to stop marketing their products to Americans, and no longer provide them with access to their site by September 30th, or else face having their licenses revoked. As the KGC press release read:

“After careful consideration, the Kahnawàke Gaming Commission has directed that an applicant or existing licensee that accepts players from a US State without being authorized by the US State to do so, is engaged in an activity that adversely affects Kahnawàke’s jurisdictional integrity or reputation. An application from an operator that engages in this activity will be denied. Existing licensees have been advised that, not later than September 30, 2016, they must modify their operations to conform to the Commission’s regulatory directive or their licenses will be terminated.”

Voluntarily Surrendered Licenses

In the wake of the KGC announcement, two major operators voluntarily surrendered their licenses, namely Salmon River Technologies Limited, which runs the site www.bovada.lv; and Lynton Limited, which runs www.cafecasino.lv, www.slots.lv and www.ignitioncasino.eu. Now, these sites will either have to continue to operate without a license or seek licensure through one of the few remaining countries that will allow for illegal operations like Curacao, Costa Rica or Panama.

What Led to the KGC Decision?

Often, we’re left to speculate, but this time, it’s pretty clear what brought the situation to a head. On the same day that the Kahnawake Gaming Commission issued their statement, the New Jersey Division of Gaming Enforcement’s (DGE) put out a statement of their own, saying that they had reached an agreement that would put a stop to illegal gaming in the Garden State.

The agreement in question is with Continent 8, a gambling hosting service that has a license in New Jersey to operate a data center. The New Jersey Division of Gaming took issue with the fact that the company was hosting sites that were registered by the KGC and being used for illegal online poker by New Jersey residents. It’s clear that in settling the matter with Continent 8, the New Jersey Division of Gaming put pressure on the KGC to stop providing licenses.

Regulatory Cooperation Not New

Following cooperation with the New Jersey Division of Gaming Enforcement’s (DGE), the KGC Grand Chief Joseph Tokwiro Norton highlighted the agreement as a “positive development”, and one that strengthens its “working relationship with the DGE.” Likewise, the DGE placed a positive note on the deal, with a statement reading:

“This agreement is an important step in ensuring the integrity of Internet gaming operations in New Jersey and helps ensure that online gaming patrons can play on fair, regulated sites.”

Nevertheless, this isn’t the first time that regulatory agencies have teamed up to put a stop to illegal gaming. In 2014, the UK Gambling Commission put requirements into their laws that any operators who were providing services in countries where they were not licensed to operate must provide clear proof that there was a business reason to do so and that they were not breaking laws. Italy has also taken similar steps to help other countries combat illegal iGaming.