NASHVILLE, Tenn. (AP) – A Tennessee sports betting company has sued state officials to try to overturn their suspension of the firm’s sportsbook, a move taken last week due to suspected fraud and money laundering in accounts on the betting platform.
On Monday, Tennessee Action 24/7 filed the lawsuit against Tennessee Lottery officials for the suspension that came at the outset of the men’s basketball NCAA Tournament, a huge sports betting event that continues for several weeks. The company is challenging the regulatory process used to suspend them and is calling into question the level of debit card fraud an investigator suspects occurred.
The company is one of six authorized so far to run sportsbooks under Tennessee’s online-only sports betting law, which saw its first bets in November.
The move marked the first time an online sportsbook operator has had its license suspended in the U.S., according to Dustin Gouker, lead analyst for the PlayUSA.com sports betting news website. The suspension remains in effect indefinitely until a review finds that proper internal controls are in place going forward.
Danny DiRienzo, a sports betting investigator for the lottery, last week said the activity would have been stopped early on, with fewer victims and less money in losses, if the company had implemented the internal controls they spelled out in their application as a sportsbook operator.