Currently, there are strict rules when it comes to regulating gambling in Ontario, Canada. The province’s gambling regulator, the Alcohol and Gaming Commission of Ontario (AGCO), constantly monitors the sector to ensure that licensed operators adhere to the established rules. Ultimately, established regulations in the province seek to safeguard the consumers from excessive gambling, prevent and support users that might be affected by the activity.

On Thursday, the AGCO revealed that its Registrar issued a notice of monetary penalty against the online gambling operator PointsBet. The CA$150,000 ($108,600) penalty comes after the Commission alleged that the operator breached several responsible gambling provisions by letting one customer spend more than CA$500,000 ($361,900) over a period of three months.

In light of the notice of monetary penalty, PointsBet can appeal the decision with the License Appeal Tribunal, which is an adjudicative tribunal separate from the gambling watchdog.

“In Ontario, iGaming operators have an obligation to proactively monitor their patrons’ play for signs of high-risk gambling, and to take appropriate actions to intervene and reduce the potential for gambling related harms.“

Dr. Karin Schnarr, CEO and Registrar at AGCO

Dr. Karin Schnarr, AGCO’s CEO and Registrar, revealed that licensed gambling operators in the province are required to monitor the activities of their customers and prevent excessive gambling. She added that licensees are obligated to take action and reduce gambling harm or at-risk behaviors. “The AGCO will continue to focus on player protection by holding all registered operators to these high standards,” said Schnarr in conclusion.

Recently, the AGCO announced a CA$80,000 ($59,000) monetary penalty against Toronto’s Woodbine Casino. Back in September, the regulator cited an investigation that uncovered insufficient controls at the venue against cheating and collusion between employees and visitors.

The Gambling Regulator Explains the Alleged Breaches

Describing the alleged breaches, the AGCO claimed that PointsBet failed to provide assistance and properly intervene with a player who potentially was experiencing gambling harm. The Commission said that the user was able to lose more than CA$500,000 ($361,900) over three months which is why they were flagged as “high-risk,” by the gambling operator. Additionally, the same customer that kept incurring significant losses also made multiple withdrawal cancellations.

In addition to those warning signs, the AGCO alleged that PointsBet failed to enforce a mandatory 24-hour cooling-off period once the player canceled their deposit limit. Moreover, the regulator alleged the operator engaged in direct advertising without the player’s consent, offering credits, bonuses and inducements.

In light of the alleged deficiencies, the AGCO also claimed that PointsBet failed to ensure proper training for its employees on how to deal with customers who may be experiencing problem gambling. The regulator claimed that the operator failed to properly inform its employees of the importance of responsible gambling.

The post PointsBet Hit With $110K Fine by AGCO over Alleged Breaches appeared first on Keno Wizard.

In a strategic move aimed at enhancing its casino offerings and driving profitability by fiscal year 2025, PointsBet Canada has appointed Brooke Hilton as its new Head of Casino. Hilton, a seasoned professional with over a decade of experience in the North American regulated iGaming industry, brings a wealth of expertise to her new role.

PointsBet Canada Gains a Strategic Edge with Brooke Hilton’s Expertise

Brooke Hilton, a native of Vancouver, previously worked with Ingenuity Gaming and Bally’s Interactive, where she served as Director of Business Development and Director of iGaming Product for North America, respectively. Additionally, she spent seven years with the British Columbia Lottery Corporation, honing her skills as a slot and tables product manager for the online casino and product specialist for the online casino.

Expressing her excitement about the new role, Hilton shared her enthusiasm on LinkedIn, stating: “It is with immense joy that I announce the beginning of my journey as the head of casino at PointsBet. I have dedicated myself to the Canadian iGaming industry for the past 10-plus years. I’m absolutely thrilled to align my passion with a company as influential as PointsBet Canada.”

PointsBet Canada’s decision to bring Hilton on board underscores the company’s commitment to staying ahead in the competitive Canadian market. Hilton’s extensive experience in managing casino operations and developing localized commercial strategies aligns perfectly with PointsBet Canada’s vision for growth. 

As the company continues to expand its footprint in Ontario, Hilton’s expertise is expected to play a pivotal role in shaping the future of PointsBet Canada’s casino offerings. With Hilton at the helm, PointsBet Canada is well-positioned to navigate the complex regulatory landscape and deliver innovative and engaging casino experiences to its customers.

PointsBet Canada Surges Amidst Ontario’s Booming iGaming Market

PointsBet Canada’s decision to appoint Hilton comes at a pivotal time for the company. The Ontario market, where PointsBet Canada currently operates, has shown promising figures in the recently released Q2 FY (2023-24) market performance report. During this period, Ontario witnessed a significant increase in total wagers, reaching CAD14.2 billion ($10.4 billion), up from CAD14 billion ($10 billion) in Q1. The majority of the revenue, CAD11.9 billion ($8.6 billion) in wagers, came from the casino vertical, including slots, bingo, and table games. There were 943,000 active accounts during this period, with an average monthly spend per active player being CAD191 ($140).

Meanwhile, PointsBet, operating in Australia and North America, reported a slight 3% decrease in its total sports betting handle, which amounted to AUD611.0 million ($387.5 million) for Q1 FY24. This decline followed the sale of its US assets to Fanatics for $225 million. Despite the dip, the company experienced an 18% increase in total net win, reaching AUD58.2 million ($36.9 million) year-over-year. 

Notably, PointsBet’s operations in Canada showcased significant growth, with a 111% increase in turnover to AUD44.2 million ($28 million) and a 212% rise in total net win to AUD5.4 million ($3.4 million) during the same period. PointsBet’s CEO, Sam Swanel, expressed optimism about the company’s profitable path and emphasized Canada’s attractiveness as a market, surpassing certain regions in the United States.

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Gambling regulators across the United States constantly monitor their respective markets, ensuring that licensed casinos, online gambling and betting operators adhere to the established regulations. Whenever breaches are uncovered, usually, a fine may be imposed. However, in more severe cases, gambling regulators can also consider license revocation.

One sports betting operator that was recently impacted by a fine in New Jersey over regulatory breaches is PointsBet. As reported by The Associated Press, the company received a fine from the gambling regulator in New Jersey, the Division of Gaming Enforcement (DGE), over violations of the established sports betting laws.

The recent report reveals that the monetary penalty against the company was imposed late last month, on August 23, but details from the New Jersey Attorney General’s Office were not released publicly before Wednesday this week. Reportedly, PointsBet reached a settlement with the DGE and agreed to pay the fine over three violations of the sports betting regulations.

The Violations Occurred in 2021 and 2022

One of the violations is related to an esports competition dating back to October 29, 2021. At the time, PointsBet offered bets for a League of Legends competition. While the company accepted four bets for that esports competition, one of the participants in one of the teams was 17 years old.

This was in breach of the established regulations that require bets to be placed on individuals with a minimum age of 18. Although PointsBet accepted four bets, totaling $1,225, the company confirmed that those bets were voided. Explaining the violation, the sports betting operator confirmed that it didn’t verify if all participants in the esports competition were aged 18 or older. Still, PointsBet confirmed that it has implemented a procedure that seeks to eliminate such future breaches.

Another breach dates back to August 2021 when PointsBet reportedly accepted pre-game bets for a game that had already started. One sports bettor placed $13,500 in bets, securing $28,275. PointsBet confirmed it uncovered the error, explaining it originated from “an unresolved communication issue” between a third-party data feed provider and the company. The aforementioned bets were voided, the DGE explained.

The last breach involves accepting bets for an ineligible game in New Jersey. This violation dates back to March 25, 2022, when PointsBet accepted two bets for a game with the Saint Peter’s men’s basketball team. The operator accepted two bets, totaling $60 but this tournament was ineligible for wagering in the state. Consequently, both bets were voided, and the sports betting operator explained that this was the result of a human error.

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PointsBet will return millions to its shareholders following the sale of its US business to Fanatics Betting and Gaming. This was confirmed during the company’s latest extraordinary general meeting.

PointsBet agreed to divest its US assets on June 30, selling its American operations of $225 million. The transaction is intended to take place over a multi-stage completion process and is still subject to regulatory approvals and customary conditions. If the deal is approved, PointsBet will receive $175 million at the initial completion and another $50 million at the subsequent completion. 

Following the sale of its US business, PointsBet plans to distribute the net proceeds to its shareholders, along with the majority of the company’s corporate cash reserves. PointsBet explained that the sale of its US assets would change its business, resulting in a surplus of reserves, thus enabling the move.

Following the sale of the US Business, the funding requirements of the Company’s remaining assets will be fundamentally different to the status quo.

PointsBet statement

According to PointsBet, the first capital return will see around $203.6 million (converted to USD from AUD) returned to the shareholders following the initial completion (expected to be completed by mid-September).

After that, a second capital return of between $80.8 million and $92.4 million will see money returned to the shareholders upon the subsequent completion (around March 2024).

The Deal Between Fanatics and PointsBet Was Mutually-Beneficial

In other news, PointsBet published its FY 2023 results, demonstrating a turnover of AUD 5.74 billion. The company attributed its stellar performance to the divestment of its US assets, which allowed it to focus on other lucrative initiatives.

Fanatics, on the other hand, will now be in the perfect position to challenge some of the mainstays of the US gambling market, including juggernauts such as FanDuel and DraftKings. Analysts believe that the acquisition will help Fanatics capitalize on the upcoming NFL season.

In the meantime, the transaction between PointsBet and Fanatics will also provide the latter company with a unique shot at New York’s gambling market. By acquiring PointsBet’s US business, Fanatics also hopes to secure an entry into one of the most promising US markets.

While regulators agreed that the company’s suitability to hold PointsBet’s NY license must be evaluated, the move is nevertheless a big opportunity for Fanatics to grow its US footprint.

The post PointsBet to Return Millions to Shareholders Following the Sale of Its US Arm appeared first on Keno Wizard.

PointsBet’s sale of its US arm to Fanatics in the final quarter of the fiscal year represented one of the primary drivers behind its stellar performance, allowing the company to focus on its other lucrative markets while unlocking significant value through the sale. Despite the tense acquisition process, the Australian operator emerged stronger than ever, ready to pursue new opportunities.

Most Metrics Remained Positive

The 2023 financial year ending June 30 saw PointsBet record revenues of AU$391.1 million ($260.29 million), marking a 26.4% year-on-year increase. Spots Betting remained the company’s most profitable vertical, contributing AU$335.8 million ($223.48 million) in profits, while iGaming made AU$55.3 million ($36.8 million). These results demonstrate the company’s stable position and growth potential.

Expense metrics were mixed, as the 2.2% cost of sales increase to AU$56.7 million ($37.74 million) offset the 47.6% decrease in quarter-on-quarter marketing costs, which reached AU$36.1 million ($24.03 million). Staff costs dropped 3.7% to AU$25.8 million (17.17 million), contrasting the 26.4% rise in administration, corporate costs, and goods and services tax, totaling AU$24.9 million ($16.57 million).

PointsBet’s US division recorded impressive results, accounting for AU$161.1 million ($107.22 million) in revenue for a stellar 72% year-on-year increase. These results bode well for the upcoming Fanatics acquisition, indicating a robust and growing business that can flourish with proper support and investments.

The Upcoming US Division Sale Is a Sensible Move

Acquiring PointsBet’s US division places Fanatics in the perfect position to challenge existing market leaders. The operator’s substantial development and marketing resources should bolster an already successful business, allowing it to compete with industry giants like  DraftKings and FanDuel. Analysts believe Fanatics can capture a significant market share before the 2023 NFL season.

Despite the US division’s profitability, the sale decision appears to be a sound move for PointsBet. The Australian company doesn’t have the resources to focus on every regional division and would be unable to reach its full potential in the USA. The Fanatics sale significantly streamlines operations and allows PointsBet to invest the extra capital in its core markets, ensuring long-term profitability.

PointsBet’s full-year 2023 results highlight the company’s ability to leverage existing resources and exceed expectations despite rising challenges. The sale of its US division will help it to better adapt to the changing demands of the industry. With a strong financial foundation and a commitment to delivering top-quality betting experiences, PointsBet is in the perfect position to achieve even greater success.

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Acquisition target PointsBet sent a letter to the Australian Securities Exchange (ASX) this morning to request a trading halt of its stock due to a material announcement.

Disclosure Obligations

PointsBet requested the immediate implementation of a trading halt on its securities listed on the ASX to allow it to manage its continuous disclosure obligations in relation to a material transaction as per ASX Listing Rule 17.1.

The Australian-based sports betting operator is at the center of an acquisition tussle between the sports commercial giant with a huge appetite in the sports betting space, Fanatics, and the second-largest in terms of sports wagering market share in the US, DraftKings.

Last month, Fanatics thought they had wrapped up a $150 million deal to acquire the US assets of PointsBet as both sides agreed to the deal under the terms of which Fanatics would pay $100 million upon transaction close and the rest in February 2024. The nascent sportsbook went live in its second US state, Maryland, in early June.

On June 16, Boston-based sports betting and gaming operator DraftKings tabled a 30% higher bid, $195 million, for PointsBet USA and derailed the agreement between PointsBet and Fanatics. A recent media report also suggested that personal motives dating back to a failed merger deal in 2021 may exist behind the risky bid.

Upon receiving the proposal from DraftKings, PointsBet said its previous agreement with Fanatics was inferior and began looking into the new bid. There is one stumbling block in the proposal as it is subject to DraftKings obtaining regulatory approvals while PointsBet insists on a “hell or high water deal” deal.

Trading Halt for One Day

In its letter to the ASX, PointsBet requested that the trading halt remains in place until the company makes its announcement to the market but no later than the commencement of normal trading on June 28, 2023, meaning that trading with PointsBet stock should be suspended for no more than a trading day.

PointsBet concluded its letter by stating that the company “is not aware of any reason why the trading halt request should not be granted, nor of any other information necessary to inform the market about the trading halt.”

The post PointsBet Requests ASX Trading Halt Due to Material Transaction appeared first on Keno Wizard.

Failed merger negotiations may be behind DraftKings’ last-minute bid to acquire PointsBet USA and derail an already negotiated deal with Fanatics, according to a media report.

Block Fanatics from New York Entry

DraftKings chief executive officer Jason Robins is determined to “level the score” with Fanatics boss Michael Rubin, still holding a grudge after Rubin walked away from an advanced $48 billion merger negotiations in 2021, The New York Post claims based on unnamed sources.

DraftKings submitted a $195 million last-minute bid to acquire PointsBet USA, derailing the $150 million deal reached a month earlier with Fanatics, as well as Rubin’s ambition to establish Fanatics as a major player in the sports betting space.

“DraftKings already has scale,” claims one of the media sources, explaining that the rationale behind outbidding Fanatics is to block Fanatics from acquiring PointsBet’s online sports betting license in New York.

“If you want to be a player you have to be here,” the source added in terms of market presence in New York as “it is the largest state [with legal sports betting at the moment as] California, Florida and Texas are not offering sports betting.”

Australian-based PointsBet holds one of nine online sports betting licenses in New York and the state has no plans to increase the number of available licenses any time soon.

Speaking to CNBC earlier this month, Rubin said that DraftKings’ bid was more about derailing Fanatics’ bid and delaying its “ability to enter the market,” rather than improving DraftKings’ market position and size, showing that DraftKings is seriously concerned with Fanatics as a potential competitor.

As the operator with the second-largest market share nationwide, DraftKings has no other competitor even close to its 29% market share, and PointsBet’s US assets would not help it significantly cut the distance with the leader, FanDuel with 45%.

No Personal Motives Behind the Bid

Representatives from Fanatics declined to comment on the story when asked by the reporting media, while a DraftKings spokesman dismissed claims that there are any other motives besides the potential for “significant synergies and financial rationale,” as well as “interesting product and technology capabilities.”

To suggest that there is an ulterior motive that is personal and not business related is irresponsible and not grounded in reality.

DraftKings spokesperson

Acquiring PointsBet USA would be of significant importance to Fanatics as it would open up cross-market opportunities for its customer base buying official sports team gear, on top of the access to the market in New York, while for DraftKings the acquisition brings potential risks.

PointsBet is reportedly looking into the proposal and will likely force a “hell or high water” merger agreement, meaning a deal with or without regulatory approvals, while the proposal tabled by DraftKings is subject to acquiring regulatory approvals.

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Interest in PointsBet’s US division continues to mount as multiple parties expressed interest in acquiring the gaming entertainment company’s regional assets. DraftKings’ recent proposal is substantially higher than the competing offer by Fanatics, increasing its appeal to shareholders. A successful acquisition would bolster DraftKings’ position in the rapidly expanding US sports betting market.

The New Proposition Represents a Last-Minute Upset

Australian-based sports betting operator PointsBet entered the US market in 2018 and has experienced significant growth and success. However, the company is facing substantial financial pressures. Despite rising revenues, plummeting EBITDA and an unexpected cash outflow hurt the operator’s long-term profitability, motivating the decision to sell its US-facing arm.

Several companies have already expressed interest in acquiring PointsBet USA. In May, global digital sports platform Fanatics offered $150 million. The deal seemed all but certain, as the two companies released a joint statement claiming the agreement would soon become official. However, the most recent updates cast doubts on these assertions as DraftKings leaped in at the last moment with a competing offer.

DraftKings clearly intends to snatch away the desirable US business, offering $195 million for PointsBet USA’s assets. The proposal threatens to end the already-agreed Fanatics deal, significantly impacting the other operator’s plans. PointsBet’s board of directors announced they would evaluate the new offer, noting that timely execution and regulatory approval remained vital factors.

An Additional $45 Million Are Difficult to Refuse

The proposed acquisition holds several strategic benefits for both companies. DraftKings will significantly expand its market presence and enhance its technological capabilities, potentially offering customers a broader range of betting options and improved features. The deal will also give the operator access to PointsBet’s established customer base, giving it an edge over other high-profile players in an increasingly competitive industry.

All other things being equal, PointsBet seems to have little reason not to go with the more lucrative deal. The extra funds will contribute to the company’s cash reserves, allowing it to focus on its core operations and growth strategies in other markets, like Australia. Divesting its US division should also reduce expenses, contributing to a more efficient and streamlined business.

Although DraftKings’ acquisition proposal came out of the blue, it presents PointsBet with a significant dilemma. The company can either abide by its previous agreement with Fanatics and settle for the lower sum or go with DraftKings and risk alienating the other company. Given shareholder returns usually take priority in such matters, gravitating toward the more lucrative offer is a distinct possibility.

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PointsBet USA, the division of the famous Australia-based sports and gaming entertainment company PointsBet, announced late on Thursday that it temporarily halted its system email communications after a third-party provider sent emails involving cryptocurrency. The company admitted that an email sent in the morning by a provider, which name wasn’t disclosed, contained communication that wasn’t official.

The popular betting provider urged its customers to delete the aforementioned email. Additionally, PointsBet asked its users not to click on any links within the message or to respond to it. At the time, the company said that the temporary halt of email communication will be in effect “until the matter has been fully resolved” with the third-party provider.

Less than two hours after the initial statement released via Twitter, PointsBet identified the issue as a “phishing attempt.” As with similar threats, phishing attacks target customers by offering different prizes and in this case, crypto was involved.

Reportedly, the culprits sought to lure customers by asking to receive crypto. In exchange, they were promised that the funds in their crypto accounts would be doubled. Recently, PointsBet hinted that it plans to exit the US and North America. Still, the company is yet to make a move in that direction.