Michigan’s campaign against illegal offshore gambling operators has gained momentum in 2025, with state regulators issuing cease-and-desist letters to at least 14 offshore websites since April of this year. The Michigan Gaming Control Board (MGCB) has targeted operators like Lucky Tiger Casino, Rich Palms Casino, and BetWhale Casino, all of which are charged with offering casino games, sports wagering, and poker to Michigan residents without the approval of the state. These actions are all part of a larger push to safeguard consumers and maintain the integrity of Michigan’s lawful iGaming industry, which had a record-breaking year with $2.9 billion in revenue in 2024.

However, the regulatory push has been contentious for some Michigan citizens. For offshore sites, the threats of litigation and up to $100,000 in penalties are intended to create a level playing field. Yet, the continued existence of unlicensed sites indicates that demand persists, even with risk.

The popularity of iGaming in Michigan cannot be disputed. In December alone, citizens wagered more than $5.3 billion on lawfully permitted sports wagering in 2024 and raked in $244 million in iGaming revenue. Slots, blackjack, and live dealer games lead the legal sector, but poker still holds onto a dedicated fan base and Michigan is currently one of the top places to play poker in the US. Recommendations about the best online poker sites often circulate in forums, though punters are always encouraged to do research on what’s regulated. This contrast of demand and control demonstrates a complex dynamic, where convenience is weighed against compliance.

Michigan’s strategy reflects general trends in US gaming regulation, with states increasingly likely to favor regulated markets over opaque offshore equivalents. The success of this approach depends on public cooperation. Although the MGCB encourages residents to report illegal activity, the allure of offshore sites (especially for niche products like high-stakes poker) continues to present an obstacle. In the meantime, the state’s record iGaming revenue and widening tax base are indications that its regulated market is prospering, even as regulators are moving to round up unlicensed competition.

Geolocation compliance is one of the biggest challenges facing regulators. Licensed operators must employ sophisticated geolocation technology to ensure that players are indeed physically located within Michigan borders when placing bets. Some players attempt to circumvent these restrictions using VPNs or other spoofing methods, causing annoying experiences for legitimate sites and driving them towards offshore platforms. According to industry experts, even a 5% failure rate in geolocation verification can result in considerable lost revenue for legal operator

The amount of money at stake is high. Authorized sites such as FanDuel and BetMGM paid Detroit $118.86 million in 2024 in taxes, and tribal sites paid $55.3 million to local jurisdictions. Offshore sites, on the other hand, are operating in jurisdictions such as Belize or Curaçao, where regulation is minimal and consumer protection is lax.

The rise of cryptocurrency payments on unlicensed sites, such as those the MGCB has pointed to, has also complicated enforcement. This situation presents a quandary for regulators: how to protect consumers while dealing with the reality of an age where access to international platforms is often just a click away.

Michigan’s legal framework relies on the 2019 Lawful Internet Gaming Act, which stipulates that internet gaming may be offered by licensed providers only. Licenses are restricted either to the licensees of the casinos that are already in existence according to the Michigan Gaming Control and Revenue Act or federally recognized Indian tribes that lawfully conduct class III gaming in Michigan. This model guarantees that operators have undergone strict vetting procedures and have a physical presence in the state, offering extra layers of accountability that offshore sites can’t match.

The crackdown is at a time when the offshores are potentially threatening because they have a tendency to be beyond regulation to ensure fair play and financial safety. For instance, the MGCB has cited examples where unauthorized sites had withheld payments, required inordinate betting, or failed to offer instruments for responsible gaming. Henry Williams, executive director of MGCB, stressed that such sites “put consumers at risk” because they do not have protection against data privacy, dispute resolution, and addiction. Michigan’s licensed market compels operators to remit taxes – $466.1 million in 2024 alone -for foreign sites in an effort to avoid such issues as withholding the state from revenue to cover public services and problem gambling initiatives.

These offshore sites typically impose harsh withdrawal terms, where players will need to bet their initial deposits many times before they are permitted to withdraw their winnings. As opposed to regulated sites, which must comply with strict regulatory conditions, offshore sites are non-transparent and offer minimal recourse to troubled players. Offshore sites also lack responsible gaming facilities such as self-exclusion systems or deposit limits that licensed Michigan sites must feature.

The reach of this crackdown goes past consumer protection. In protecting its regulated market, Michigan is ensuring gaming revenues keep flowing to fund public initiatives, whether education or infrastructure. With that said, the continued existence of offshore gambling speaks to a need for continued education regarding the dangers of unregulated sites – and the value of adhering to licensed providers. As the MGCB gets increasingly opposed to offshore options, the security-choice trade-off will continue to be the primary issue facing Michigan’s iGaming industry.