US lawmakers decry sports betting practices while introducing SAFE Bet Act

Legal sports betting became a states’ rights issue in 2018, when the US Supreme Court struck down the Professional and Amateur Sports Protection Act (PASPA). Since then, nearly 40 US states and jurisdictions have legalised some form of wagering.

Tonko and Blumenthal outlined the parameters of the bill, which was first announced in March, at a press conference in Washington on Thursday. They were joined by three other speakers.

Mark Gottlieb and Harry Levant, executive director and gambling policy adviser for the Public Health Advocacy Institute (PHAI) at the Northeastern University School of Law, talked about the public health impacts of sports betting. Gordon Douglas gave an emotional account of his son Andrew’s descent into sports betting addiction and eventual recovery.

Overall, the message was clear: the current US sports betting landscape is untenable.

Bill would implement widespread changes, federal framework

The SAFE Bet Act – short for Supporting Affordability and Fairness with Every Bet – would significantly alter the legal sports betting industry. It focuses on three A’s: affordability, advertising and artificial intelligence.

It also notably calls for “a general nationwide prohibition” on sports betting. That would seem contradictory to the Supreme Court’s decision on PASPA, but Tonko said Thursday that the ruling was “explicit” in saying that “congress retains the right to regulate sports gambling”.

As such, states would have to meet federal minimum requirements. According to an outline of the bill, states that wish to offer wagering would have to apply to the US attorney-general. Those applications “must include detailed attestations that show how a state has met the minimum federal standards” outlined in the bill. Approvals would be valid for three years. It is not known whether applications would be different for states that have already legalised. Wagering is legal in 38 states plus Washington, DC.

“We’re not telling states what to do,” Blumenthal said. “We’re setting a floor, a minimum they have to meet to have their applications certified. They have a lot of freedom within those parameters to do more.”

Both lawmakers repeated several times that the bill would not be a ban on wagering. But Blumenthal said that federal oversight was needed “to take back control of an industry that is out of bounds”.

Advertising, inducements under fire

Changes to advertising and bonusing practices are key pieces of the bill. It would ban betting ads from TV broadcasts between 8am and 10pm and during live sporting events. It would also prohibit inducements, or ads that entice viewers to bet or open accounts.

“Advertising for this known addictive product should be limited to times and spaces when children are not likely to be in the audience,” Tonko said. He added that celebrities should not be “teaching you their favourite parlay” on promotional materials. Blumenthal decried the fact that sportsbooks “target losers” in their bonusing and advertising strategies.

“Let’s be very clear: right now, the gambling industry methodically and relentlessly targets losers,” he said. “Because that’s where the money is. People who lose are losing to the benefit of the gambling industry.”

The comments were interesting given that the Massachusetts Gaming Commission (MGC) just held a hearing on the practice of limiting bettors. Officials from Fanatics Sportsbook told the MGC that “fully half” of the bettors it limits are losing bettors.

Blumenthal also said that a national self-exclusion list is needed and would be formed through the SAFE Act. Such lists are already in place in Australia (BetStop) and the UK (Gamstop).

Bill would implement new affordability measures

Affordability measures are another key component of the legislation. The proposal would establish a cap of five deposits per 24 hours, ban credit cards as funding sources and require operators to conduct affordability checks on bettors who bet more than $1,000 in 24 hours or $10,000 in 30 days.

If the term “affordability checks” sounds familiar, it’s because the concept has polarised the UK betting industry for the last year.

“The onus should be on the sportsbooks to not serve customers who are chasing losses,” Tonko opined. In one of multiple comparisons to the alcohol industry, Tonko said that any bar in America is restricted by law not to serve those who have had too much.

AI technologies deemed “most frightening”

Of the three aspects of the bill, Blumenthal called AI “the most appalling and frightening”. His belief stemmed from the ability of AI to track bettors’ habits and send them personalised offers.

Tracking players and crafting tailored messages through AI would be banned under the bill. It would also ban AI-created gambling products, most notably microbetting. Microbetting was noted several times as a new form of betting that is especially dangerous. DraftKings’ recent purchase of microbetting supplier Simplebet was mentioned by name.

Tonko lamented that, through microbetting, “every single solitary moment” of sporting events “has become a betting opportunity”. He also said that the relationship between gambling and sports has become “intolerably dangerous”.

All prop bets featuring college or amateur athletes would be also banned under the act. That is a huge topic of debate in the industry. The NCAA has publicly lobbied for an all-out ban in response to player harassment. Some states already have such bans; others are considering them, and still others have taken no action.

Opposition responded swiftly

Unsurprisingly, several industry stakeholders responded swiftly to the bill and the sentiment was not positive.

Chris Cylke, senior vice-president of government relations for the American Gaming Association (AGA), argued that operators and regulators across the country are already doing the work that the bill outlines.

“Six years into legal sports betting, introducing heavy-handed federal prohibitions is a slap in the face to state legislatures and gaming regulators who have dedicated countless time and resources to developing thoughtful frameworks unique to their jurisdictions and have continued to iterate as their marketplaces evolve,” he said in a statement.

Nevada representative Dina Titus, a longtime champion of gambling legislation, called the bill an “outdated and unwarranted prejudice against gaming”.

“While the SAFE Bet Act is perhaps well-intentioned, pre-empting state gaming regulators by outlawing most forms of advertising and restricting the types and methods by which customers can place bets is a misguided approach,” she said.

The iDevelopment and Economic Association (iDEA), a trade body representing igaming and sports betting operators, said the bill “represents an unnecessary and harmful federal overreach into an area that has been successfully regulated at the state level since the Supreme Court’s decision to overturn the federal sports betting ban in 2018.”