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Borgata Casino paid $75,000 to the NJDGE for overstating promotional credits
By Zach Wolpin,
11 hours ago
Atlantic City in New Jersey is home to several sportsbooks and casinos, including Borgata. Recently, Borgata agreed to pay a $75,000 civil penalty to the New Jersey Division of Gaming Enforcement for overstating their internet casino gaming promotional credits. This led to an underpayment of tax revenue in the Garden State. Additionally, this was Borgata’s second incident in the last 18 months, leading to more than $1 million in underpaid taxes. On August 15, a letter was addressed to Borgata’s legal council. The New Jersey Division of Gaming Enforcement said the MGM property overreported $4.5 million in promotional BetMGM iGaming credits. That led to $365,161 in underpaid taxes earlier this year.
New Jersey law says regulators can deduct these credits and other free play from their taxable revenue. Borgata’s recent incident follows another complaint against the company in March 2023. They overstated credits by $9.8 million, leading to a $787,700 tax shortfall. NJDGE interim director Mary Jo Flaherty had this to say. She noted that Borgata was quick to remedy the unpaid taxes in both of the cases that have happened in the last two years.
“The Division views this matter as serious”, said Flaherty. “The original violation was an understatement of gross revenue by almost $10 million. The second understatement of gross revenue was in an amount of over $4.5 million. These understatements resulted in the assessment of additional taxes, tax penalties and interest over $1.3 million.”
What did Borgata do wrong?
According to Borgata, a software switch is to blame for the hundreds of thousands in underpaid taxes. An audit from March 2023 revealed that the company erroneously included table game bonuses in their calculation of iGaming promotional credits. Borgata said this all happened because of a software error by BetMGM. It caused their system to incorrectly deduct more credits than it should have. In July 2024, the same issue occurred because of software-related problems. That made it the second time in 18 months that Borgata ran into the same issue. Since then, Borgata has paid a $75,000 civil penalty Mary Jo Flaherty said the company has since developed new software aimed at preventing major tax errors in the future.
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