iGaming debate heats up in Virginia: profits, risks, and regulation on the table

With online gaming expanding across the country, Virginia lawmakers are wrestling with whether to legalize iGaming — a move that could bring new revenue but also new challenges.

As iGaming makes it possible for users to gamble with a tap on their phone, the tool offers both benefits and hurdles for policymakers considering how to build Virginia’s gambling market. States like New Jersey have already reaped financial rewards, with that state becoming the nation’s largest regulated online gaming market.

Dave Rebuck, a former director of the New Jersey Division of Gaming Enforcement, told the Joint Subcommittee to Study the Feasibility of Establishing the Virginia Gaming Commission at its meeting in Richmond about how his home state authorized and launched the nation’s first competitive internet gaming market. 

One key factor Virginia policymakers will need to weigh, Rebuck said, is how to foster cooperation among state and federal leaders, backed by a clear plan.

“Based on my experience, there’s proof in concept to taking a multi-pronged approach to cracking down on the illegal market, with legalization being a critical component to every approach,” Rebuck said. 

“But let’s not fool ourselves,” he added. “Unless we have tremendous support and collaboration between government agencies, including the federal government, the status quo of the illegal market and the offshore sites that are engaged in businesses, in every state, are not going to go away.”

Tuesday’s committee meeting zeroed in on iGaming — online casino games such as Blackjack, Craps, Poker, Roulette, and Slots that can be played on smartphones, tablets, or computers. Lawmakers heard multiple presentations weighing internet gambling’s advantages, drawbacks, and challenges.

Supporters argue internet gaming offers convenience by eliminating the need to travel. But critics note that it presents risks for both consumers and policymakers.

Illegal operators, for example, provide no consumer protections and contribute nothing to Virginia’s Problem Gambling Treatment and Support Fund. They often target minors and self-excluded individuals, according to Keith Whyte, founder and president of Safer Gambling Strategies, LLC.

Whyte added that research “consistently” shows iGaming is tied to elevated risks of gambling addiction, with the highest rates among men between 18 and 35.

Experts further briefed lawmakers on the negative impacts online gaming could have on revenue and jobs at casinos. 

Brianne Doura-Schawohl, founder and CEO of Doura-Schawohl Consulting, also outlined some of the public health and economic concerns tied to online gambling, including higher rates of suicides, substance abuse, and drops in average credit scores, and rising credit card delinquency. 

According to her presentation, individuals with a gambling disorder are 15 times more likely to die by suicide than the general population.

Studies have also found that more teenagers are gambling online through the use of loot boxes in video games.

“I think that the federal government may never come to the table when it comes to addressing the public health issue of problem gambling,” Doura-Schawohl said, urging Virginia lawmakers to take action before considering an expansion of the gambling market.

“There’s too many things that need to be resolved before — if I were in your shoes — I would consider doing this,” she said.

During the last General Assembly Session, lawmakers considered legislation to legalize internet gaming in Virginia. Those proposals ultimately failed to advance out of either chamber, and legislators opted instead to send the issue for further study.

iGaming is currently legal in eight states and available to roughly 14% of the U.S. population, Del. Marcus Simon, D-Fairfax, said Tuesday. He added that the industry could generate an estimated $5.3 billion in new taxable revenue during its first five years.

Senate Bill 827, introduced by Sen. Mamie Locke, D-Hampton, would have authorized the Virginia Lottery Board to issue licenses to casino operators for online gaming. Like other proposals, the measure was left in committee to allow for additional study.

The subcommittee plans to hold two more meetings before the next General Assembly session begins in January. The next meeting, tentatively scheduled for September, will focus on existing and planned casinos. The final meeting will address broader gaming issues, such as skill games and charitable gaming, all ahead of the 2026 session.

Sen. Bryce Reeves, R-Spotsylvania, committee chair, said gambling enforcement remains one of his top priorities. That effort, he stressed, begins with creating the Virginia Gaming Control Agency to regulate the industry.

“We need to get the VGC set up like yesterday and start enforcing the law so we can get a handle on some of these things,” Reeves said. “Personally, I’m not passing any other bills until you all help us get the VGC done, because we’re just creating more mess and every year that we don’t get it passed, creates more and more chaos.”

Del. Paul Krizek, D-Fairfax, the committee’s vice chair, echoed Reeves’ concerns.

“Gaming can continue to be a powerful engine for jobs, revenue and community investment, but it’s got to be managed responsibly without streamlined oversight,” Krizek said. 

“The risks multiply predatory practices, inconsistent rules, heightened risk for problem gambling and loss of public trust. The Virginia Gaming Commission is a step we need to preserve the good, address those challenges, and build a fair, accountable and prosperous gaming industry for everyone in the commonwealth.”

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