New Jersey Revokes PlayUp Online Gambling Licenses
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The New Jersey Division of Gambling Enforcement has revoked beleaguered PlayUp’s New Jersey licenses.
PlayUp was active in another state, Colorado, but despite asking Colorado regulators to put the site in maintenance mode, PlayUp was still up and running on Friday.
In a statement to TopNJCasinos.com, a spokesperson for the NJDGE said the DGE revoked the Australian company’s online gambling and sports betting licenses on July 19.
“Patrons will be able to access their funds and can withdraw them from the site,” the spokesperson told NJTopCasinos.com in an email. “Additionally, PlayUp is obligated to pay out any pending wagers, while no new wagers can be accepted. We encourage patrons to contact DGE at info@njdge.org if they have any concerns or require further assistance.”
PlayUp’s sites went offline in New Jersey on Wednesday after failing to comply with several DGE requests for information. In a three-page letter to PlayUp, NJDGE Director David Rebuck listed several other allegations:
- PlayUp has outstanding invoices owed to the Division.
- PlayUp has significantly reduced its employee headcount in New Jersey, with numerous officers departing from the company.
- PlayUp claims to be investigating a potential fraud charge for a patron that requested withdrawal in March 2023, but never notified the division and cannot explain the delay in finalizing the investigation.
“PlayUp’s continued non-compliance with NJSA 5:12-80 and inability to comply with the requirements of NJAC 13:69O and NJAC 13:69N demonstrate that it is currently unable to offer real money sports wagering to New Jersey customers at the standard required by Division statutes and regulations,” Rebuck wrote.
PlayUp’s Short But Eventful Time In The U.S.
Australian-based PlayUp has been a purveyor of sports betting and apps since 2014. Its expansion into the U.S. began in 2019 with the hiring of Dr. Laila Mintas as U.S. CEO. Mintas quickly expanded its U.S. footprint with market access deals (a strategy from a bygone era) and positioned the company for sale.
PlayUp was once considered a promising acquisition target with an estimated value of $450 million. A sale to Sam Bankman-Fried’s now-bankrupt FTX went up in smoke, leading to a wild case of public finger-pointing, with PlayUp claiming US CEO Laila Mintas badmouthed the company and tried to increase her personal compensation, effectively blowing up the deal. That resulted in a lawsuit and a countersuit, with litigation still ongoing.
But even after the FTX debacle and executive-level infighting, PlayUp was valued at around $350 million and supposedly had a new suitor in September 2022, SPAC, IG Acquisition Corp. No deal materialized, and while the company soldiered on, the writing for the U.S. division was on the wall.
On LinkedIn, Mike Rosselli, former Chief Compliance and Legal Officer at PlayUp wrote:
“Two years ago I poured my blood, sweat and tears into getting the approved by the New Jersey DGE with very limited resources. I'll always be immensely proud of my team's hard work and what we were able to accomplish with such a lean US staff. It was very disappointing to see the results of all that hard work come crashing down yesterday.
“When I resigned from PlayUp last year I had a feeling there was a strong chance this day would come because of the company’s internal issues. I sympathize with my former US colleagues and sincerely hope their voices are heard as this story continues to develop.”
Another harbinger was when the Ohio Casino Control Commission fined the company over illegal slot wagers and denied a supplier license in Ohio in December 2022. PlayUp officially pulled its application in April 2023.
Before the actions by the New Jersey DGE, PlayUp was rumored to have been purchased by an unnamed public company (whether the deal will come to fruition is an open question), with the company letting go of most of its U.S. staff. And as the DGE’s letter stated, some of the company’s employees have not been paid – the Australian Financial Review has more details on the late and missing payment of wages and health benefits.
The Bigger Picture
The U.S. sports betting arena was a modern-day gold rush.
And it turned out to be very much like the California Gold Rush, meaning a few people got rich mining gold, a few others got rich by having the right assets at the right time, and a few others got rich by providing the supplies and services needed during a gold rush (usually at an extreme markup). But most entities that came to the U.S. seeking sports betting riches wound up holding an empty bag.
The fallout is beginning to be seen. PlayUp joins Churchill Downs, MaximBet, and Fubo as failed operators. And PlayUp won’t be the last, as several other operators have reduced their U.S. ambitions.
