Sports Betting Alliance Hit With Historic Fine in Maryland for Campaign Disclosure Failures
Posted on: June 22, 2023, 12:42h.
Last updated on: June 22, 2023, 09:47h.
The Sports Betting Alliance (SBA), an organization that represents the interests of US sportsbooks operating in legal markets across the country, now has the dubious distinction of being the recipient of the largest fine ever imposed by the Maryland State Board of Elections.
The SBA helped bring legal sports betting to the Old Line State by spearheading the pro-sportsbook campaign in 2020. Maryland’s path to legal gambling on sports had to go through voters, as dictated by the state constitution.
The SBA encouraged state lawmakers to promote the legalization of sports betting. A separate political action committee (PAC) called Vote Yes on Question 2 also produced and ran television, radio, and social media advertisements that hyped the benefits regulated sports betting would deliver.
The message resonated, as 67% of state voters during the November 2020 election supported amending the Maryland Constitution to permit gambling on professional and college sports. Though state lawmakers struggled to find a consensus on how to best permit such gambling, the General Assembly passed its sports betting bill in April 2021. Then-Gov. Larry Hogan (R) signed the statute, which permits both retail and online sports betting, into law the following month.
The SBA consists of four member sportsbook partners, including BetMGM, DraftKings, FanDuel, and Fanatics.
One of the many responsibilities of the Maryland State Board of Elections is compiling campaign finance reports for political committees and disclosing those summaries to voters.
The state election agency recently completed a four-year audit that included the 2020 election cycle. The probe resulted in the discovery that the SBA failed to properly disclose its fundraising and associated activities in a timely manner.
This was simply a filing error by our compliance team,” a spokesperson for the Sports Betting Alliance told Maryland Matters. “As soon as we realized the mistake, we immediately filed the missing form and worked with the Maryland State Board of Elections to correct the error.”
The recent audit, however, showed that the SBA’s amended filing in 2020 came 48 days after it was originally due. The Maryland State Board of Elections subsequently implemented a $1,000 per day fine for the compliance mishap for a total penalty of $48K.
Protecting the Public
Jared DeMarinis, the Maryland State Elections Board’s director of campaign finance, told Maryland Matters that since there is no fundraising cap on independent expenditure committees such as the SBA, swift filings are required so the public has adequate time ahead of casting their ballots to know where the money supporting such campaigns is coming from.
The whole point is that these penalties are here because of the impact independent expenditure committees have on the [election] process,” explained DeMarinis. “They usually come in the last possible second and do some political ads or disseminate campaign material that could possibly affect the election and you need to have very timely disclosure to ensure that individuals are making informed choices at the ballot box.”
DeMarinis, however, acknowledges the severity of the SBA penalty.
“We’re cracking down hard on disclosure with independent expenditure entities and that was the biggest one that was collected so far,” DeMarinis revealed.
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