Nevada Officials Warn of $400B Illegal Online Gambling Threat

The letter warns that the rapid growth of online gambling poses a long-term challenge to Las Vegas Strip casinos and urged federal action.

Ziv Chen

Last Updated: August 13, 2025 1:39 PM EDT • 2 minute read

Nevada Officials Warn of $400B Illegal Online Gambling Threat — Pictured: Nevada Attorney General Aaron Ford speaks to the media about fighting to save the U.S. Department of Education at the Democratic Party headquarters. Photo by Jason Bean/RGJ / USA TODAY NETWORK via Imagn Images.

A recent letter from the Nevada Attorney General's office estimated that illegal online gambling generates more than $400 billion annually, costing states an estimated $4 billion in lost tax revenue. The letter warned that the rapid growth of online gambling poses a long-term challenge to Las Vegas Strip casinos and urged federal action.

Nevada Attorney General Aaron Ford, along with attorneys general from several Republican and Democratic states and US territories, called on the Department of Justice (DOJ) to intervene.

The letter highlighted three measures to curb illegal activity: blocking access to unregulated sites under the Unlawful Gambling Enforcement Act, seizing Internet servers and online domains, and partnering with banks and other financial entities to block money transfers.

The American Gaming Association (AGA) reported that about 40% of the US sports betting market is captured by illegal operators. AGA President and CEO Bill Miller added that fighting unregulated gaming needs the efforts of everybody, including policymakers, law enforcers, regulators, and licensed businesses.

In addition, a separate report published by the Campaign for Fairer Gambling and Yield Sec revealed that illegal gambling sites accounted for 74% of total online gambling revenue generated throughout the United States. It's a big blow to the best sportsbooks operating legally.

The Las Vegas Convention and Visitors Authority (LVCVA) also estimated the 2024 legal gaming industry's economic effect at $87.7 billion. However, according to the latest LVCVA figures, convention attendance, hotel room occupancy, and passenger traffic through Harry Reid International Airport were down from last year.

Las Vegas faces tourism challenges

Falling tourism numbers compound the pressure on Las Vegas casinos. In June, the city hosted about 3.09 million visitors, down 11.3% year over year, according to the LVCVA.

Convention visits declined 10.7% from June 2024, after rebounding briefly during May. Passenger traffic through Harry Reid International Airport fell 6.3% during the same period.

Economic uncertainty and weaker consumer confidence continue to weigh on travel decisions, with year-to-date visitation down 7.3% from 2024. Travel from Canada remains significantly lower, with June arrivals a third below last year.

Hotel occupancy in June averaged 78.7%, with Strip occupancy at 81.9%, down 6.4% year-over-year. The decline impacted revenue per available room (RevPAR), which fell 13.5% on the Strip to about $129. Average daily room rates also dropped, with Strip rates down 6.7% to $174.31.

Despite these declines, Nevada casinos reported $1.33 billion in gaming revenue for June, up 3.53% from last year. The Strip's $765.3 million gaming win marked a modest 0.9% increase.

Highway traffic into Las Vegas also fell, with Interstate 15 border counts down 4.3%. Convention attendance reached 375,000 in June but was reduced by the absence of major rotating events like InfoComm and Cisco Live, resulting in a nearly 50,000-person decrease.

Written by:
Ziv Chen

Ziv has over two decades of experience in the igaming and sports betting industry, having served in senior marketing and business development positions with both B2C and B2B companies, including Playtech and Microgaming. In 2019, Ziv decided to pursue his passion for writing and became a fulltime industry journalist, covering casino, sports, and gambling business news. He’s specialties include casino games and technology, US state gambling regulation, company performance, as well as gambling affiliates and marketing. As a Pitt graduate, Ziv is a diehard fan of all Pittsburgh sports teams, with the Steelers at the top of the list. In his free time, he enjoys reading crime fiction, biographies (mainly of sports personalities, but not only) and American history. Ziv’s Favorite quote: “We're going to pursue perfection, knowing full well we won't catch it, but we're going to relentlessly chase it," Mike Tomlin, Pittsburgh Steelers Head Coach.