Mutual funds for New Jersey sports bettors? Nevada version struggled

Five years after a similar bill was passed in Nevada, New Jersey legislators introduced a proposal to allow “entity betting with horse racing and sports pool operators.” The proposal is often described as a ‘mutual fund’ for sports bettors.

D-Hudson County Rep. Raj Mukerji introduced the four-page A5138 bill late last week. [would be] Used by fund managers to bet on various sporting events in order to generate returns for investors. Any profit or loss of the entity will be shared by each investor in proportion to his/her share. “

However, so-called “physical betting” is considered a failure in Nevada, and few Las Vegas sportsbooks show any interest in gambling variations. And on Tuesday, a prominent New Jersey sports bettor sharply criticized the bill.

Last year, the powerful Securities and Exchange Commission indicted Bettor Investments LLC and its CEO, Matt Stewart, for “fraudulent and unregistered offers and sales in sports betting ventures.”

According to the SEC complaint, “since March 2016, defendants have obtained a total of approximately $145,500 from approximately 70 investors across the United States by selling sports betting profits without registration with the SEC or applicable exemptions. procured.

Additionally, the SEC said that in late 2016 and early 2017, bettors and stuarts returned some of their investor funds and converted the remaining investor funds into promissory notes with supposedly ‘guaranteed’ rates of return. claims.

“The Complaint states that the defendants have provided investors with a number of information, including losses already incurred by bettors and Stuart, how those losses will be apportioned among the investors, the present value of the investments, and the risks associated with the investments. alleging that he misrepresented material facts, Stuart’s compensation, and use of investor funds.”

Professional bettors speak

New Jersey-based sports betting expert who used the online alias “Captain Jack Andrews” to speak out against the bill on Twitter,write in:

“Until now, New Jersey has been a shining example of what legal sports betting can be like in the United States. I am proud to be a resident of the state and a professional bettor. However, entity betting is a dark road dominated by scammers and exorbitant administrative fees.

“Nevada’s foray into entity gambling has resulted in numerous investigations from the State Securities and Exchange Commission and the SEC. The gaming industry does not support it. Consumer advocates do not support it.”

“In short, most companies fail to beat the market and extract personal profits with exorbitant management fees.

“In the early days of legalized sports betting, physical betting is not a viable concept. There may come a day when true liquidity is measured through exchanges. consumers will be disadvantaged.”

CG Technology Supports Nevada Version

The bill, signed into law in Nevada in 2015, was supported by a campaign led by CG Technology, and its passage prompted Quinton Singleton, the company’s general counsel, to declare in a statement: did. North America. “

In 2016, CG Technology became the first Las Vegas operator to accept such “entity bets.” Bettor He Investments and Stuart were his first clients. However, there were concerns about the feasibility of that form of betting.

By the end of 2017, disgruntled Bettor Investments clients had already filed complaints against Stuart and the company in the Attorney General’s Office.

In 2018, the SEC indicted another sports betting fund, Contrarian Investments, on similar grounds.

CG Technology — formerly known as Cantor Gaming — acquired Las Vegas sportsbooks such as The Venetian and The Cosmopolitan three months ago by British bookmaker William Hill, but William Hill’s ties said recently. online gambling in new jersey The Meadowlands sports betting skin was not part of the transaction.

Mukazi, the legislative sponsor, does not represent the town of East Rutherford, where the Meadowlands Sports Complex is located. But he does represent nearby neighborhoods, including parts of Jersey City – home to countless large financial firms.

Deja vu again?

The New Jersey bill is in many ways the same as the Nevada bill.

Nevada: “A person who willfully violates, attempts to violate, or attempts to violate any provision of subsection 1 of NRS 463.160 or section 3 of this act shall be guilty of a category B felony and shall be sentenced to state prison. shall be punished with imprisonment for a minimum of one year and a maximum of ten years, or a fine not exceeding $50,000, or both a fine and imprisonment.”

New Jersey: “Anyone who willfully violates, attempts to violate, or attempts to violate a provision is guilty of a second degree offense and is punishable by imprisonment for a minimum of 5 years and a maximum of 10 years. $50,000. impose the following fines, or both imprisonment and fines:

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