Evolution Cleared of Misconduct by New Jersey Division of Gaming Enforcement

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Following an exhaustive investigation, the New Jersey Division of Gaming Enforcement (NJDGE) has confirmed there will be no actions against Evolution, which was allegedly accused of misconduct by the NJDGE.

Where the Claims Began

The investigation into Evolution began in November 2021, after law firm Calcagni & Kanefsky LLP alleged wrongdoing on the New Jersey operator. The allegations claimed that Evolution’s products were made available in countries subject to US trade sanctions.

At the time, Evolution denounced the allegations, protesting that the claims were a means to discredit the company. Unfortunately, as a result, Evolution’s share price dropped by 16% just a week after the allegations.

“The NJDGE found no evidence that Evolution sanctioned, promoted, permitted, or otherwise materially benefitted from its content offered by operators in any market that the NJDGE considers a prohibited jurisdiction,” Evolution said in a statement.

Evolution’s Defense and Players Technical Manipulation

During the time of the allegation, Evolution underlined its work with various regulators and operators to establish a successful means of blocking unwanted players from countries such as Syria, Sudan, and Iran, which are on US sanction lists.

Evolution claimed that people from prohibited countries would only be able to access its content through “advanced technical manipulation”. This sort of manipulation would only be possible through advanced VPNs, which change the IP address of the user, making it seem that the user is in a different country where products are available.

After multiple attempts to use the original IP address, players finally accessed the content by using a VPN. Evolution attributed the actions of these players as, “a deliberate course of action to circumvent a broadly accepted and well-established process to check users’ geographical location, with the purpose of discrediting Evolution”.

Operators Required to Perform “Know Your Customer” Checks

Evolution is not directly connected to players or funds they invest in, so just like other game providers in the state, requires that the operators check each customer thoroughly. Following this search, the operator can then decide if the player can participate given their current location.

Additionally, Evolution reiterated the fact that they are required to have valid licenses in each market they are present in.

“Evolution also conducted an internal review, while concluding that its due diligence and compliance processes were sufficient, Evolution took the opportunity to enhance its processes. The NJDGE supports the enhancements that Evolution has made. The enhancements did not relate to any jurisdictional violations.”

The NJDGE has closed this matter with no further action against Evolution.

Additional Trouble for Evolution

While this investigation ultimately fell in favor of Evolution, unfortunately, it is not the last of the provider’s worries at this time.

At the beginning of the year, the company had a class action lawsuit filed against it. The lawsuit claimed that Evolution deceived its investors as it pertains to its growth trajectory and compliance.

The investors who purchased Evolution’s shares believe they were misled by the company through various false statements. The statements investors claim to be untrue pertain to Evolutioin’s growth potential, customer compliance, the company’s compliance, and the effect of non-compliance on revenue.

The controversial business transactions and series of misleading statements happened between February 14, 2019, and October 25, 2023.

Jacob Kaplan, chief financial officer, and Martin Carlesund, Evolution CEO, are the defendants in this lawsuit.

Mac Daniel is a writer for PlayOnlineCasino and PlayOnlineSportsBetting. He has experience writing about a wide variety of topics, including healthcare, tourism, non-profit organizations, and most recently casino and sportsbetting news. To check out more of his work, visit: playonlinemichigan.com