First came the Sports Betting Boom. Now comes the setback.
WASHINGTON – Lawmakers and regulators who started the big expansion of legalized gambling in the United States are now moving in places across the country to tighten oversight of the gambling industry, especially when it comes to advertising that could reach underage players.
The crackdown extends to the players themselves, as at least three states have responded to a jump in abusive behavior by going after bar gamblers if they threaten or harass athletes after losing games.
This more aggressive approach to online betting is evident in nations around the world, including Australia, Belgium, Canada, the Netherlands and the UK, where officials in recent months have enacted or proposed new restrictions on online betting, in some cases banning celebrity sponsorships and almost all advertising.
Nationally, 33 states and the District of Columbia offer legal sports betting, with Kentucky, Maine, Nebraska and Florida next. That means more than half of Americans live in places where sports betting is allowed, five years after the Supreme Court overturned a law that had banned most states from legalizing the practice. In total, Americans have legally wagered over $220 billion on sports since the 2018 trial.
In the US, the alignment of state regulations and laws began this winter in states including New York, where mobile sports betting generated $16.5 billion in gaming and an extraordinary $909 million in new tax and licensing revenue the first year it was legal.
But the explosive growth of legally sanctioned online betting on sports also raised concerns that it could cause harm. New York responded by proposing new rules banning any advertising on college campuses or that is “directed to persons under the minimum age,” which in New York is 21, while Ohio stepped up enforcement actions.
“People are waking up to the need to intervene and not wait a decade and have the full brunt of the damaging effects of this, especially on minors,” said Matt Schuler, executive director of the Ohio Casino Control Commission, who said he was extremely disappointed. with content advertising in his state that bet started this year. “The industry will certainly never police itself.”
An estimated $1.8 billion was spent advertising online gambling last year in local U.S. markets, according to BIA Advisory Services, an industry data aggregator, up nearly 70 percent in just one year, adding to a sentiment among certain state regulators — and many sports viewers — that the airwaves had become too saturated with sports betting ads.
In the past six months, Maryland, Maine, Massachusetts, Ohio and Connecticut have adopted or proposed new rules related to sports betting, some of which are now in effect or awaiting final approval. Measures vary from state to state, but most aim to prevent deceptive marketing or promotions aimed at underage players.
Maine has proposed rules that would allow sports betting television ads to appear only during live broadcasts, which would be the most restrictive policy in the country. They will also ban ads offering betting bonuses and ban the use of “cartoon characters, professional or Olympic athletes, celebrities or entertainers” in ads.
Massachusetts last month formally banned marketing on college campuses and banned advertising aimed at minors. This month it also joined New York in banning sports betting marketing outfits from being paid a commission on bets placed by the patrons they supply to sports betting platforms, based on a concern that these arrangements could lead to problem gambling.
Brian O’Dwyer, chairman of the New York State Gaming Commission, said sports betting in his state generated a windfall in tax revenue. But he added, “We have to make sure we don’t hook people, we don’t promote problem aging, and we certainly don’t promote underage gambling.”
Maryland and Connecticut are moving separately to ban gaming companies from signing deals with public universities in which they pay schools to help them market their sports betting platforms.
“I think it’s outrageous,” state Rep. Amy Morrin Bello of Connecticut, Democrat of Wethersfield, said of the deals some gaming companies have signed with eight universities around the country. Her bill banning the deals passed this month by 142 to 0.
Mrs. Morrin Bello and Mr. O’Dwyer said their regulatory move was prompted by reporting by The New York Times last year about the explosive growth of sports betting in the United States, including college marketing.
Ohio’s Casino Control Commission has levied more than $800,000 in fines on sports betting companies since January. The violators included DraftKings, one of the most prominent betting platforms, which acknowledged that it illegally claimed players could make “free” bets and falsely sent out 2,582 ads to citizens under the legal betting age of 21, encouraging them to download the mobile app and claim $200 in free spins.
Penn Entertainment, another major sports betting company operating under the Barstool brand, was fined separately in February. Late last year on the University of Toledo campus, Barstool hosted a college football show promoting the company’s mobile sports betting application despite a ban on advertising aimed at anyone under the age of 21.
Both companies declined to comment.
Mr. Schuler said the enforcement had resulted in more compliance from advertisers. But he said he still had concerns, such as the betting company’s logos emblazoned on the jerseys of the Columbus, Ohio-based professional soccer team, a practice he called “absolutely offensive,” given that those players are heroes to many youngsters. “Their greed trumps the common sense they should use when looking for harm to minors,” he said, adding that he currently does not have the authority to ban betting sponsors from appearing on jerseys.
The increase in abusive behavior directed at college athletes and professional players has drawn attention from coaches and the players themselves. Anthony Grant, the coach of the University of Dayton men’s basketball team, condemned verbal and online attacks on his players from angry players in January, just days after Ohio legalized sports betting.
In a hearing in Illinois last month, Josh Whitman, the athletic director for the state’s flagship university, asked lawmakers to continue banning the state’s sports books from accepting bets on in-state college sports. He presented lawmakers with a letter, signed by representatives from many of the state’s universities, that included five pages of crude and sometimes racist comments about players and teams online.
Chris Boucher, a forward for the NBA’s Toronto Raptors, described on a podcast in March one of the hateful messages he received from a punter. “I picked the wrong slave today,” the person wrote to Mr. Boucher on social media after losing the bet.
“In its purest form, players feel offended that sometimes fans act like players are playing to bet,” said David Foster, assistant general counsel for the association that represents NBA players. “When it crosses the line and becomes harassment and threatening, it’s even worse.”
Although the specific language differs, law or rule changes proposed or approved in Ohio, West Virginia and Massachusetts this year would broadly allow state officials to bar players who threaten or harass athletes.
The industry has backed the proposals, saying it abhors such behavior towards athletes.
“There’s absolutely no place for that,” said Casey Clark, a senior vice president at the American Gaming Association, whose members include most of the major casino companies as well as FanDuel and DraftKings. “And anyone who takes their reaction to losing a bet to the extreme, I think has a gambling problem and needs to seek help.”
The gambling industry and professional sports leagues have announced their efforts to confront harmful practices – and prevent further mandatory tightening of the rules.
It includes revisions to the American Gaming Association’s “responsible marketing code” that supports the ban on the concept of “risk-free” games and prohibits marketing partnerships with colleges. The professional sports leagues and some television networks have joined to create what they call the Coalition for Responsible Sports Betting Advertising, making statements such as “sports betting should only be marketed to adults of legal age.”
Mr Clark said the industry was taking steps to confront emerging issues before regulators, reflecting a commitment “to provide the right kind of consumer protection that will enable a sustainable legal sports betting market.”
Brianne Doura-Schawohl, a lobbyist who represents the National Council on Gambling and other organizations, said the move to tighten the rules was a response to the sloppy job state officials did in passing laws that legalized sports gambling in so many states since 2018.
“These are discussions that should have happened before legalization,” she said.
The moves abroad by regulators, Doura-Schawohl added, reflect what could come next if the U.S. sports betting industry does not move quickly to head off problems that have emerged in countries where sports betting has, in some cases, been legal for years.
Australia is preparing to ban the use of credit cards to place online bets, which now account for around 20 percent of bets. Starting this summer, Belgium and the Netherlands will ban gambling advertising on TV, radio, newspapers and in public spaces.
“If you have untargeted ads – billboards and TV commercials – you can’t control who sees them, including young people and those with gambling problems,” said Frerick Althof, a spokesman for the minister of legal protection in the Netherlands.
Canada’s largest province, Ontario, last month proposed a ban on the use of athletes and celebrities in advertising, concluding that the “potential harmful impact on the most vulnerable population, minors, remains high.” And in the UK, the government agency that oversees online gambling launched a long-awaited study last month which concluded that “change is needed now” as “gambling poses a risk of becoming a clinical addiction”, and suggests “financial risk checks” for players. which loses more than $160 a month and supports a move to remove gambling logos from the front of players’ shirts.
Mr. Clark, of the American Gaming Association, said the gambling industry would object if any of these moves were proposed in the United States because it has pending limits on sports betting advertising in Maine, which it considers excessive.
“We’ve always wanted to learn from more mature markets,” he said, but added, “We don’t support limiting when we can market legal, regulated business.”