NJ DGE Fines PokerStars $25,000 Over Short-Term Geolocation Error

What appears to have been a minor and temporary error in the geolocation protocols preventing would-be poker players outside New Jersey’s borders from accessing the state’s licensed, real-money online games has ended up costing PokerStars NJ and its parent company, Amaya Inc., $25,000.  The New Jersey Division of Gaming Enforcement (DGE) quietly announced the fine a couple of weeks back in a situation that was quickly corrected by PokerStars, via a software update.

There is no indication that the geolocation error was widespread or lasted for a long period of time, or that the small handful of players who accessed PokerStars’ New Jersey site wagered significant sums of money.  There was also no indication that underage players were involved, which would have been unlikely anyway: Geolocation is actually the lesser of the two “Know Your Customer” (KYC) security protocols that overlay all online gaming authorized in New Jersey.  Ongoing ID verification of all participating real-money players remains the first (and most important) protocol, and there is no indication that that security measure was ever violated.

The DGE released few specifics about the nature of the geolocation lapse.  The likeliest scenario is that in involved a small number of players in one of New Jersey’s border communities, who discovered on a cross-border trip — and likely barely over the border at that — that they were still able to access the Stars site.  Such information could have spread quickly within a small group of friends or relatives.

Of course, such geolocation errors are not supposed to happen.  The protocol works via time-of-arrival / angle-of-arrival communications between ground-based towers (triangulation) and satellite-based relays (GPS). GPS itself is only accurate to within a 10- or 20-foot margin of error, except for higher-accuracy military applications, which most of us aren’t supposed to know about.

What that means is that in order to be safe, that last few outer feet of what looks like New Jersey to the towers, satellites, and GPS geolocationn software is usually blocked.  Except there was an error involved… perhaps because Stars’ geolocation services tried to cut the error margin too fine.

The DGE summarized its findings with this agenda line in its latest “Director’s Rulings” summary: “Issued an order pursuant to a stipulation of settlement imposing a $25,000.00 civil penalty against Amaya US Services Limited for violation of geolocation rules;”

The complete text of the order, which follows, offered barely any more detail:

The Division of Gaming Enforcement (“Division”) having conducted an investigation into allegations that Respondent, Amaya US Services Limited (“PokerStars”), due to a software flaw, permitted certain patrons not physically located within New Jersey to wager on its regulated Internet wagering site; and

The investigation having revealed that the software flaw had allowed a limited number of patrons to wager while not located in New Jersey for a short period of time before a subsequent geolocation check detected such patrons and blocked them from wagering; and

The investigation having revealed that PokerStars has since deployed an update which fixed the software flaw so that all persons located outside of New Jersey are now prevented from wagering on its website;

Having considered the findings of the Division’s investigation, the relevant portions of the Division’s regulations, [specific statutes cited], the Stipulation of Settlement which the parties executed, and the factors in mitigation presented by PokerStars, and finding sufficient legal and factual support for the penalty therein;

I hereby ORDER that a civil penalty of $25,000 be imposed on Respondent PokerStars, as agreed to in the Stipulation of Settlement.

David L. Rebuck

Director

The very minor fine likely covers the cost of the Division’s investigation and the time spent on the paperwork, and not much more, illustrative of how minor this geolocation error likely was.  Nonetheless, such errors shouldn’t occur and must be fixed immediately if they do.