• About Us / Contact
  • Responsible Gambling
This site contains commercial content
SportsHandle
  • US Sports Betting
    • Arizona
    • Colorado
    • Illinois
    • Indiana
    • Kentucky
    • Louisiana
    • Maryland
    • Massachusetts
    • Michigan
    • New Jersey
    • New York
    • North Carolina
    • Ohio
    • Pennsylvania
    • Tennessee
    • Virginia
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel Sportsbook Promo Code
    • BetMGM Bonus Code
    • Bet365 Bonus Code
    • Caesars Sportsbook Promo Code
    • ESPN BET Promo Code
    • Fanatics Sportsbook Promo Code
    • BetRivers Promo Code
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
  • News
No Result
View All Result
SportsHandle
  • US Sports Betting
    • Arizona
    • Colorado
    • Illinois
    • Indiana
    • Kentucky
    • Louisiana
    • Maryland
    • Massachusetts
    • Michigan
    • New Jersey
    • New York
    • North Carolina
    • Ohio
    • Pennsylvania
    • Tennessee
    • Virginia
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel Sportsbook Promo Code
    • BetMGM Bonus Code
    • Bet365 Bonus Code
    • Caesars Sportsbook Promo Code
    • ESPN BET Promo Code
    • Fanatics Sportsbook Promo Code
    • BetRivers Promo Code
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
  • News
No Result
View All Result
SportsHandle
No Result
View All Result

Carousel Group Fined For MaximBet’s 16 Days Of Missed Geolocation Checks In Colorado

It is not clear how many wagers were made out of state, but company was alerted by customer complaint

Jeremy Balan by Jeremy Balan
April 21, 2022
in Legal, Regulation
Shutterstock

Shutterstock

Share on FacebookShare on Twitter

Through a stipulation agreement with the Colorado Division of Gaming, Carousel Group, the operator of MaximBet, has been fined $80,000 for an error that allowed bettors from outside the state to place online sports wagers during a 16-day window in December.

According to the stipulation agreement β€” which was filed with the Colorado Limited Gaming Control Commission (LGCC) and unanimously approved by the commission Thursday β€” from Dec. 1 to Dec. 16, sports bettors were able to place wagers through the MaximBet website without being geolocated, which allowed wagers outside of Colorado, in violation of state law.

MaximBet self-reported the issue to the Division of Gaming on Dec. 23, after a bettor made a call to the operator’s customer service department Dec. 18, β€œbecause he was unable to place a wager due to a failed location check.” When informed that bets must be made in Colorado, the customer β€œresponded that had not been an issue previously,” according to the stipulation agreement.

Investigations launched

The customer service request triggered an internal investigation at MaximBet, which found β€œone high-probability case and four suspected cases” of bettors being able to place wagers outside of Colorado.

According to the stipulation agreement, MaximBet wrote to the Division of Gaming, β€œWe discovered a technical conflict between our fraud management system and GeoComply system, which introduced an edge case scenario in which the back end system was not correctly verifying all GeoComply tokens, which had allowed one player to place bets without verification.”

MaximBet’s investigation, according to the agreement, found only customers using web browsers were able to place wagers without being geolocated, while its β€œapps remained functioning as expected.” MaximBet said 29 customers placed wagers without being geolocated during that time, but β€œbelieved they could reasonably eliminate 25 patrons whose IP addresses had an association with Colorado,” and that those customers had been geolocated in Colorado since MaximBet β€œimplemented a permanent fix” to address the lapse in geolocation.

An investigation by the Division of Gaming, however, noted that MaximBet’s β€œanalysis to determine the scope of the geolocation issues made the assumption that any patron who had placed a wager and been successfully in Colorado continued to place their wagers in Colorado during the system error” and that MaximBet β€œhad no way to confirm this assumption.” Those bettors, even though they previously made wagers in Colorado, could have and may have made wagers outside of Colorado at any time during the 16-day window, because they were not being geolocated.

Sign Up For The Sports Handle Newsletter!
I also want to receive information and offers about online sportsbooks (eg. odds boost, welcome offers)

MaxmBet’s investigation identified four bettors who β€œcould not be ruled out as placing bets outside of Colorado.” Those bettors had addresses from Hickory, North Carolina; Pittsburgh, Pennsylvania; the Bronx, New York; and Portsmouth, New Hampshire. The initial bettor who contacted customer support had the North Carolina address, but Division of Gaming investigators were not able to contact the individual despite β€œseveral attempts.” The bettors from Pittsburgh and New Hampshire spoke with Division of Gaming investigators and β€œconfirmed they were in Colorado when they placed their sports betting wagers.” The New York bettor was not reached by Division of Gaming investigators.

The Division of Gaming investigation also found that the average number of geolocation transactions logged in November and December through the MaximBet website, outside of the 16 days where geolocation was disabled, was 416 per day, and that the average number of failed geolocation transactions per day during that time was 21. The Division of Gaming therefore contended that an estimated 336 failed geolocation checks during the 16-day period could have occurred.

In February, the Division of Gaming met with representatives from Odds On Compliance, which MaximBet had hired β€œto assist them with compliance issues.” The Odds On Compliance reps explained that MaximBet turned off geolocation through its website Nov. 30, then turned it back on Dec. 17, but the agreement stated β€œthe only reason they knew the timeframe was from the geolocation data.” To this end, MaximBet β€œdid not know who turned the [geolocation] off or why, as they were not conducting any testing or changes at the time.”

MaximBet previously indicated that the configuration was for β€œtesting purposes only,” but admitted later it was only alerted to the issue because of the North Carolina bettor’s call to customer service. Federico Rocca, head of operations at Carousel Group, told the Division of Gaming that MaximBet “had not identified the person or reason [geolocation] had been switched off,” and said MaximBet has “user access controls in place, but the controls were not formally documented within their internal control procedures.”

Changes made

MaximBet reported to the Division of Gaming on Feb. 15 that it would close accounts for the customers “who did not reside in Colorado [and were] identified as possibly placing bets outside of Colorado.” It also “retroactively” voided their wagering activity and refunded the customers’ losses.

In a letter to the LGCC, Carousel Group CEO Daniel Graetzer said, “We regret the technical misconfiguration in our sports wagering platform” and that the company holds “regulatory compliance as a top priority.” Graetzer also wrote that Carousel has “voluntarily undertaken an audit of our Colorado operations and controls, instituted a more rigorous change management process, increased staffing in our compliance department, and updated our internal controls.”

In a statement, GeoComply said, “As verified through [the Division of Gaming’s] investigation, the technical integrity of our systems was not an issue. We have, however, collaborated with [MaximBet] to support updates to their internal controls and other corrective measures that address the underlying issue.”

Other sanctions

Along with the $80,000 fine, which was based on a rate of $5,000 per day of violation, Carousel agreed to have its sports betting platform “re-certified by an independent testing laboratory approved by the Division [of Gaming],” to review its “user access controls to log system changes affecting production and test platforms,” to “audit their internal controls and submit proposed changes to the Division to address compliance issues,” and to comply with Colorado’s laws and regulations going forward.

“MaximBet takes regulatory compliance very seriously, which is why the moment we became aware of the issue, we immediately stopped accepting wagers and self-reported to the regulator,” said Doug Terfehr, Carousel’s vice president of marketing, in a statement. “Since the discovery, we voluntarily and successfully re-certified our platform to ensure full compliance, and in partnership with the regulator, completed a full audit of our systems to prevent this from reoccurring.”

Failure to comply with the conditions of the agreement will require an appearance before the LGCC “to show cause why further judgment and discipline should not be imposed,” which would have the maximum penalty of “revocation or suspension of licensing privileges” and a $25,000 fine for each charge of violation.

ShareTweetShare
Jeremy Balan

Jeremy Balan

Jeremy Balan has been a journalist, editor, and sports writer since 2007. After years covering prep, college, and pro sports for online and print media, he focused on turf writing at BloodHorse from 2015-2019 and won an Eclipse Award for his coverage of the devastating fire at San Luis Rey Training Center. Contact Jeremy on Twitter (@jeremybalan) or through email at [email protected].

This site contains commercial content. We may be compensated for the links provided on this page. The content on this page is for informational purposes only.

Related Posts

deion sanders mirrored glasses
Industry

It’s ‘Prime Time’ Again As Sanders’ Colorado Football Team Piques Bettors’ Interest

September 29, 2023
patrick mahomes scrambling against lions
Industry

GeoComply Reports 242 Million NFL Week 1 Betting Transactions, Up 56% Over Last Year

September 13, 2023
Load More

Top Stories

guitar-hotel-hard-rock-florida

Court Decision Clears Way For Hard Rock Bet To Launch In Florida … But Will It?

September 28, 2023
taylor swift donna kelce

Will Taylor Swift-Travis Kelce Relationship Make Sports Bettors Out Of More Women?

September 28, 2023
system error

Schuetz: Palpable Errors In Sports Betting, And The Palpably Bad Decisions That Follow

September 25, 2023
have-a-game-plan-bet-responsibly-screenshot

Bettors Know All About Responsible Gambling, But Most Don’t Use Tools

September 12, 2023

State Sports Betting Guides

Sports Betting in Kentucky

Kentucky Sports Betting – Welcome Offers & Best Legal Sportsbook Apps for 2023

by Dukes Wooters
September 28, 2023

Ohio (U.S. state) flag waving against clear blue sky, close up, isolated with clipping path mask alpha channel transparency, perfect for film, news, composition

Ohio Sports Betting – All Online Sportsbooks, Bonus Offers, and News 2023

by Brian Pempus
October 4, 2023

Downtown Detroit at twilight (Shutterstock)

Michigan Sports Betting – Where To Play, Online Sportsbooks, And FAQ

by Brett Smiley
October 2, 2023

VA captial

Virginia Sports Betting – Where To Play, Online Sportsbooks And Bonus Offers

by Brett Smiley
October 2, 2023

nj flag

New Jersey Sports Betting — Where To Play, Online Sportsbooks, And FAQ

by Brett Smiley
October 2, 2023

Canada Sports Betting Guides

Canada Sports Betting – Best Sportsbook Apps 2023

British Columbia Sports Betting – Legal Update, Available Sportsbooks, and FAQ

Ontario Sports Betting – Legal Status And Where To Play

SportsHandle

  • Analysis
  • Casino
  • Features
  • Horse Racing
  • Industry
  • Legal
  • Legislation
  • Lottery
  • Opinion
  • Podcasts
  • Poker
  • Politics
  • Promotions
  • Regulation
  • Sports
  • Uncategorized

Better Collective

This website is owned and operated by Better Collective USA. Trademarks and copyrights referenced on this website are and shall remain the exclusive property of their respective owners and/or licensors. Please be sure to visit the operator’s website(s) to review their terms & conditions. We advise you to read these carefully as they contain important information. Copyright Β© 2023 USBets.com | Better Collective USA
21 Play Responsibly
Gamble Aware West Virginia
Gambling Problem? Call 1-800-Gambler.
GameSense

Search Sports Handle

No Result
View All Result
  • About Us / Contact
  • Responsible Gambling

No Result
View All Result
  • US Sports Betting
    • Arizona
    • Colorado
    • Illinois
    • Indiana
    • Kentucky
    • Louisiana
    • Maryland
    • Massachusetts
    • Michigan
    • New Jersey
    • New York
    • North Carolina
    • Ohio
    • Pennsylvania
    • Tennessee
    • Virginia
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel Sportsbook Promo Code
    • BetMGM Bonus Code
    • Bet365 Bonus Code
    • Caesars Sportsbook Promo Code
    • ESPN BET Promo Code
    • Fanatics Sportsbook Promo Code
    • BetRivers Promo Code
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
  • News