PlayUp USA faces uncertain future after New Jersey regulator revokes license
Embattled Australian operator potentially nearing US sports betting exit as Colorado operations go into ‘maintenance mode’
The New Jersey Division of Gaming Enforcement (DGE) has revoked the online gambling and sports betting license of PlayUp USA for non-compliance with the DGE’s codes of practise.
Issuing an emergency order, DGE director David Rebuck confirmed an end to the company’s three transactional waivers which had allowed PlayUp USA to operate in the state.
As a result, PlayUp USA, which operates on Freehold Raceway’s online license, is required to process all existing bets and customer withdrawals, but can accept no new wagers or deposits, and cannot transfer any monies held on an account without the approval of the DGE.
PlayUp USA’s New Jersey site was closed down by the operator on Thursday, July 20, with the operator indicating a “temporary” pause to its operations.
It followed the issuance of a three-page letter from Rebuck to PlayUp global CEO Daniel Simic, a letter which indicated a timeline of information requests made by the regulator, requests which had gone unfulfilled.
Items requested include confirmation of year-to-date remittance of employee withholding tax, bank statements and payroll information for a period January to June 2023.
Made in late June, these requests were unanswered by PlayUp USA CFO Glenn Macpherson, with Simic later confirming Macpherson’s exit from the firm on July 7, and asking that the information request be passed onto him for action.
Subsequent strongly worded requests were made by the DGE on July 14, with Simic providing some, but not all of the information requested, despite warnings that failure to comply may lead to disciplinary action.
The letter confirms that the required information has not been provided to date. In addition, the DGE indicated three other areas where PlayUp USA has not complied with New Jersey statutes.
These include a number of outstanding invoices which are owed to the DGE requiring payment, and the absence of updated commentary on an investigation of potential fraud by a customer relating to a March 2023 withdrawal.
The DGE’s letter confirms the significant reduction in headcount at PlayUp’s US operations, with “numerous” employees departing the business. These include PlayUp USA’s chief operations officer, head of compliance, head of sportsbook, and head of product, with those roles currently being unfilled.
The role of New Jersey office head is now being fulfilled by Simic, despite him being based in Australia.
“Nothing in this order shall prejudice PlayUp from reapplying for a transactional waiver in the future,” Rebuck wrote.
In order to reapply, PlayUp must submit its platform to the DGE for review and compliance check as well as satisfy any inquiries and outstanding invoices.
“The Division reserves the right to bring future disciplinary action against PlayUp, as well as its associated entity and individual qualifiers, for any violation of the Casino Control Act, Sports Wagering Act, or division regulations based on the facts currently presented or arising from subsequent investigations.”, Rebuck added.
Elsewhere, PlayUp USA’s Colorado sportsbook operations have been placed into a ‘maintenance mode’, effectively closed to new deposits or bets, pending a potential relaunch in the state. In a statement, the operator confirmed it had asked the Colorado Division of Gaming (CDG) for permission to place the account in this mode, with PlayUp encouraging players to withdraw funds deposited on the site.
It is understood that the CDG has made similar requests for financial information to those requested by New Jersey regulators to PlayUp, including tax, banking and employee payroll information. These requests, it has been suggested, are currently unfulfilled.
The New Jersey license revocation and potential closure of the Colorado business are the latest setbacks for the PlayUp US business, which saw a reverse blank check merger with IG Acquisition Corp (IGAC) fall through in January 2023.
IGAC terminated merger discussions after PlayUp failed to provide financial statements required, while worsening macroeconomic conditions contributed to the $350m deal being aborted.
Simic has not responded to a request for comment after being contacted by EGR.