Connect with us

Betting

Colorado Sports Betting Audit Reveals Tax Discrepancies Amid Regulator Malpractice

Colorado sports betting audit has revealed a number of issues within state regulatory agencies.

A recent audit of the Division of Gaming and Colorado Limited Gaming Control Commission found multiple instances of severe mismanagement by gambling regulators in the Centennial State. Colorado sports betting sites could be in trouble. 

Summarizing The Colorado Audit

The marks against Colorado’s regulatory agencies highlighted issues of tax discrepancies and an alarming lack of background checks among operators. And while the audit attributed most of the state’s shortcomings to a rushed sportsbook launch, accountability falls on regulators.

Local officials have been too slow to issue permanent licenses, making it difficult to fully investigate wrongdoings on behalf of operators. Despite the gravity of the matter, it is unclear what, if any, penalties the commission will face.

What becomes most unsettling is that Colorado has had two years to resolve the misgivings and complications of an early launch. If national sportsbook brands are fudging numbers here, who is to say that these miscalculations are not happening in other legal sports betting states?

Sportsbooks Skip Out On Taxes

The Monday report highlighted one especially egregious incident in which an unnamed operator reported $1.4 million more in daily wagers than what was submitted to state tax filings. Still, these offenses were found to be common among state-licensed sportsbooks. 

The record says the following:

“Auditors’ analysis of the 324 tax filings reported from May 2020 through April 2021 showed that if operators had not been allowed to deduct and carry forward operating losses, the State would have collected an additional $706,000 in sports betting tax revenues during the first year,”

Hundreds of thousands of dollars lost is nothing to turn one’s cheek from. In Colorado, this amount of theft is considered a Class 3 felony. 

Adding fuel to the fire, no one knows exactly who these sportsbook operators are. As of March 2022, 35 of Colorado’s 39 legal online and mobile sportsbooks have yet to complete a full background check with the state.

With lawmakers having founded this campaign on the premise of “ending” criminal gambling activity, the irony is scalding. How could something this substantial so easily slip through the cracks?

State-Licensed Swindling

The news comes as a cautionary tale to domestic bettors, confirming that state-licensed sportsbooks are not always the safe option. Or even a reputable option for that matter.

Division officials at the Gaming Control Commission say that they are engaged in active talks with the Governor’s office to develop a better approach for data verification. But that doesn’t change the damage that has already been done and what has left to be discovered.

Bettors have wagered almost $7 billion since domestic Colorado sportsbooks launched in 2020 and continue to supplement that figure daily. 

If the state isn’t getting the money that it is contractually entitled to, players should feel no obligation to bet with an in-state sportsbook. 

Source: The Denver Gazette

Click to comment

Leave a Reply

Your email address will not be published.

More in Betting