U.S. lawmakers introduce bill to put regulations on sports betting operators

• Two U.S. lawmakers have introduced a bill to address sports betting at the federal level.
• The proposed legislation would focus on affordability, advertising and artificial intelligence.
• Operators, meanwhile, say the sports betting industry has brought benefits, such as tax contributions, and state regulations are adequate.

Sports gambling has exploded across the United States over the past six years and, in response, two lawmakers have introduced legislation that would implement federal regulations on the practice.

Rep. Paul Tonko D-N.Y. and Sen. Richard Blumenthal, D-Conn., on Thursday introduced the Supporting Affordability and Fairness with Every Bet, or the SAFE Bet Act, which seeks to ensure sports betting operators comply with minimum federal standards and tries to address the public health implications resulting from the legalization of sports betting.

“This relationship between the gambling industry and sports has reached intolerably dangerous levels, and it’s well past time for Congress to just to step up and make a difference,” Tonko said in a press conference on Thursday.

The Supreme Court struck down the federal ban on sports betting in 2018. Six years later, sports betting has exploded across the United States, as 38 states have legalized it. The industry posted a record $11 billion in 2023, marking a 44% increase over the previous year, according to the American Gaming Association.

It’s also brought billions in new revenue to states as they take a cut of the pie through taxes.

The rapid growth has led to operators fronting big money to acquire customers through advertisements, promotions and enticements.

“Now every single solitary moment of every sporting event across the globe has become a betting opportunity, whether you’re scrolling on social media, driving down the highway past billboards, or listening to your favorite podcast or radio station, sports betting ads are there to prompt you with an endless cascade of flashy promotions,” Tonko said.

Gordon Douglas joined the lawmakers at the press conference and said he’s seen the challenges of gambling addiction firsthand with his son, 28-year-old Andrew Douglas. Gordon Douglas says his son, an athlete and coach, signed up with a gambling company and was then inundated with promotions and ads from at least six others.

“He became a different person that would say anything to get money to gamble,” he said. “He reached a point of wanting to end his life because he saw no way out.”

The Douglas family is not alone — an estimated 7 million people in the U.S. have a gambling problem, with one in five problem gamblers having attempted suicide, according to the National Institutes of Health and National Council on Problem Gambling.

A July report found that the odds of bankruptcy filing in states with legal betting increased by as much as 25% to 30%.

The lawmakers say they are not trying to ban gambling on sports — they are just trying to make it safe for the public to enjoy as a recreational activity by pushing for a national standard.

“State regulation is faint-hearted and half-baked. That’s why we need a national standard — not to ban gambling — but simply to take back control over an industry that is out of bounds,” Blumenthal said Thursday.

The bill addresses three key areas tied to sports betting: advertising, affordability and artificial intelligence.

“This industry is exploiting the most advanced technology to make the most money,” Blumenthal said about AI.

He said he wants to prohibit the use of AI to track player’s gambling habits and individual promotions.

The bill is also pushing for changes to advertising, which includes prohibiting sportsbooks from advertising during live sporting events that are intended to induce gambling with “no sweat,” or “bonus” type bets.

Finally, the legislation would limit customer deposits to five in a 24-hour period. It would mandate gambling operators ensure customers who wager more than $1,000 can afford to do so.

“The gambling industry is following a playbook developed by the tobacco industry and this is a direct threat to public health,” said Richard Daynard, a law professor and president of the Public Health Advocacy Group at Northwestern.

The sports betting operators, meanwhile, are fighting back and saying the industry has brought benefits.

Chris Cylke, the American Gaming Association’s senior vice president of government relations, said the bill is “a slap in the face” to state regulators and gaming operators that have dedicated significant time and resources to developing the framework as the market evolves.

“Today’s regulated sports wagering operators are contributing billions in state taxes across the U.S., protecting consumers from dangerous neighborhood bookies and illegal offshore websites, and working diligently with over 5,000 state and tribal regulators and other stakeholders to ensure a commitment to responsibility and positive play,” Clyke said.

The bill has also received public opposition from Rep. Dina Titus, D-Nev., who called the SAFE Bet Act “outdated” and “unwarranted.”

Douglas said his family has been able to get help for his son, but he wants to ensure that others don’t fall down a similar path.

“We as a country should not allow him and others like him to be exploited,” he said. “We should do what is right to limit access to this type of gambling.”

If you are having suicidal thoughts or are in distress, contact the Suicide & Crisis Lifeline at 988 for support and assistance from a trained counselor.

— CNBC’s Contessa Brewer contributed to this report.