Arkansas lawmakers have filed a bill to legalize online casino gaming in the state, aiming to curb the growing prevalence of unlicensed offshore gambling platforms. This initiative, which could significantly reshape the state’s gambling landscape, was introduced in the legislature on Wednesday, March 19. House Bill 1861, co-sponsored by Rep. Matt Duffield (R-Russellville) and Sen. Dave Wallace (R-Leachville), seeks to regulate online gaming within Arkansas while also introducing harsh penalties for those that operate unlicensed gambling sites.

House Bill 1861 aims to extend Arkansas’s existing gambling framework by allowing the state’s three licensed casinos—Saracen Casino Resort, Oaklawn Racing Casino Resort, and Southland Casino Resort—to offer online casino games such as blackjack, roulette, and craps via mobile apps. Currently, these casinos operate online sports betting platforms, but the new bill would expand their capabilities to include traditional casino games.

In addition to facilitating the expansion of mobile gaming, the bill includes provisions that would regulate interactive games and promotional raffles, particularly those associated with name, image, and likeness (NIL) collectives benefiting Arkansas universities. This component of the bill would allow these collectives to use casino gaming promotions to raise funds for student-athletes, subject to approval by the Arkansas Racing Commission.

The bill has gathered bipartisan support, according to KARK, with cosponsors ranging from Senate President Pro Tempore Bart Hester to Reps. Ken Ferguson and Glenn Barnes. However, the Senate companion bill was withdrawn just a day after its introduction. The proposed legislation is now expected to be debated in the House Judiciary Committee following the legislature’s spring break.

Combating Unlicensed Gambling Operations

One of the driving forces behind House Bill 1861 is the surge in unregulated, offshore gambling platforms operating in Arkansas. These websites offer various online gambling services without adhering to the state’s regulatory framework. Carlton Saffa, Chief Market Officer for Saracen Casino Resort, has voiced concerns about the risks these platforms pose to consumers, particularly given their lack of consumer protection measures and failure to contribute to state tax revenue.

In March 2023, Saracen Casino Resort formally requested that the Arkansas Racing Commission amend existing casino rules to allow limited forms of online gaming, a step Saffa argues would help eliminate unlicensed competition. He noted that many of these illegal operators are based overseas, with some having links to China, further complicating regulatory oversight.

These unlicensed platforms often provide a full range of gambling products, including online slots, table games, and other interactive experiences. Despite their offshore status, these sites are easily accessible to Arkansas residents, who have no legal recourse in case of disputes or problems with these operators.

The bill seeks to address these challenges by making it a felony to operate an unlicensed online casino or sportsbook in Arkansas. By doing so, lawmakers hope to protect Arkansas residents and ensure that only the state’s three licensed casinos have the authority to offer online gambling services.

The Growing Trend of Regulating Online Gambling

Arkansas is not alone in its efforts to combat unregulated gambling. Other states, including Michigan and Mississippi, have also taken steps to crack down on illegal gambling platforms. For example, Michigan recently issued cease-and-desist letters to several unlicensed operators offering online slots and roulette, while Mississippi made it a felony to operate illegal gambling websites within the state.

In Arkansas, the stakes are particularly high, as lawmakers argue that legalizing and regulating online gaming will not only protect consumers but also create significant economic benefits. By legalizing online casino gaming, the state would generate new revenue streams and ensure that gambling activities remain under the jurisdiction of the Arkansas Racing Commission.

The bill’s proponents also emphasize the potential for economic growth through increased revenue for higher education institutions. The legislation’s language notes that regulated gaming can support universities and their athletic programs, thereby fostering economic development and commerce throughout the state.

Opposition to the Bill

Despite its growing support, the bill has faced opposition from some groups. The Social and Promotional Games Association (SPGA), which represents businesses involved in sweepstakes and social gaming, has criticized the bill for limiting consumer choice and stifling innovation. In a statement, the SPGA argued that the bill unfairly favors the interests of established casinos at the expense of other gaming providers, threatening competition in the market.

In addition, some stakeholders, including Oaklawn Racing Casino Resort, have expressed concerns about the broader implications of legalizing online casino gaming. Oaklawn has argued that iGaming is detrimental to public policy, a position that has added controversy to the debate surrounding the bill.