Rhode Island Targets Illegal Gambling Sites, Cites Loss of State Revenue
Rhode Island officials, led by the Rhode Island Lottery and the State Police, have launched a crackdown on illegal online gambling sites operating within the state. This move comes as the state’s budget relies heavily on gambling revenue, and offshore operators continue to operate despite official warnings.
As reported by The Providence Journal, Attorney General Peter Neronha’s office ordered the Rhode Island State Police to open an investigation in September 2025. This action was requested by the state Department of Revenue after the Lottery’s gambling enforcement unit found that six companies continued to operate after receiving cease-and-desist letters in June.
Offshore Operators Persist
The core of the issue is the state constitution, which mandates that all lotteries and casino gambling be “operated” by the state. This tight control ensures profits are channeled into the state budget.
According to state Revenue Director Thomas Verdi, “Several companies were identified as engaging in the business of operating unauthorized and unlicensed casino gaming products in the state.” Verdi confirmed that these companies “continue to operate in this jurisdiction” despite the initial warnings.
The six companies targeted with cease-and-desist letters were:
- BetUS
- BetOnline
- MyBookie
- WildCasino
- YouWager
- Bovada
These companies primarily offer traditional online sports betting. Their continued operation poses a direct threat to the state’s legal, monopolized system, which relies on revenue sharing.
Revenue Protection and Competition Concerns
The state’s budget for this year relies on $433 million in revenue from various forms of gambling. If any company can offer online betting in Rhode Island without a contract and revenue-sharing agreement, it will erode interest from licensed sportsbook companies.
Currently, Rhode Island operates a monopoly model for mobile sports betting through one official app, managed by International Game Technology (IGT). This contract gives the state more than half of all revenue. While lawmakers have approved an expansion into online mobile casino table games run by Bally’s, the overall legal market faces mounting external pressure.
Prediction markets, which combine betting and investing and are often regulated as financial platforms, are also drawing scrutiny. Although the targeted illegal sites are traditional sportsbooks, other platforms like Kalshi allow users to bet on events, including the Rhode Island Democratic primary for governor.
Rhode Island Lottery spokesman Paul Grimaldi stated that because the state constitution requires all casino gambling to be state-operated, Kalshi “is not licensed or authorized by the Rhode Island Lottery to operate in the state.”
U.S. Rep. Seth Magaziner echoed concerns about unregulated betting, saying he shares the belief that prediction market sports betting could “undermine regulated sports betting that is safer and more secure for consumers.” He added that the CFTC should “crack down on this loophole.”
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