First Came the Sports Betting Boom. Now Comes the Backlash.
WASHINGTON — Legislators and regulators who began the headlong expansion of legalized gambling in the United States are now moving in spots nationwide to tighten oversight of the gambling industry, particularly as it relates to advertising that may reach underage bettors.
The crackdown extends to bettors themselves, as at least three states have responded to a jump in abusive behavior by moving to bar gamblers if they threaten or harass athletes after lost bets.
This more aggressive approach toward online betting is evident in nations around the world, including Australia, Belgium, Canada, the Netherlands and the United Kingdom, where officials in recent months have enacted or proposed new online betting restrictions, in some cases banning celebrity sponsorships and nearly all advertising.
Nationally, 33 states and the District of Columbia offer legal sports betting, with Kentucky, Maine, Nebraska and Florida up next. That means more than half of Americans live in places where sports betting is permitted, five years after the Supreme Court overturned a law that had prohibited most states from legalizing the practice. Collectively, Americans have legally bet over $220 billion on sports since the court action in 2018.
In the United States, the tweaking of state regulations and laws started this winter in states including New York, where mobile sports betting generated $16.5 billion in bets and an extraordinary $909 million in new tax and licensing revenue in the first year it was legal.
But the explosive growth of legally sanctioned, online betting on sports also produced growing concerns that it could cause harm. New York responded by proposing new rules that prohibit any advertising on college campuses or is “aimed at persons under the minimum age,” which in New York is 21, while Ohio stepped up enforcement actions.
“Folks are waking up to the need to intervene and not wait a decade and have the full brunt of harmful effects of this, particularly on minors,” said Matt Schuler, executive director of the Ohio Casino Control Commission, who said he was extremely disappointed with content of advertising in his state as betting started this year. “The industry will certainly never police itself.”
An estimated $1.8 billion was spent advertising online gambling last year in local markets in the United States, according to BIA Advisory Services, an industry data aggregator, up nearly 70 percent in just one year, contributing to a sense among certain state regulators — and many sports viewers — that the airwaves had become too saturated with sports betting ads.
Over the last six months, Maryland, Maine, Massachusetts, Ohio and Connecticut have enacted or proposed new rules relating to sports betting, some of which are now in effect or awaiting final approval. The measures differ by state, but most aim to prevent deceptive marketing or promotions targeting underage bettors.
Maine has proposed rules that would allow sports betting television advertisements to appear only during live game broadcasts, which would be the most restrictive policy in the nation. They would also prohibit advertisements that offer 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 prohibited advertising aimed at minors. This month, it also joined New York in moving to prohibit sports betting marketing outfits from getting paid a commission on bets placed by patrons they deliver to sports betting platforms, based on a concern that these arrangements might feed problem gambling.
Brian O’Dwyer, chairman of the New York State Gaming Commission, said sports betting in his state was generating a windfall of tax revenue. But he added, “We have to make sure that we don’t hook people, we don’t promote problem gambling, and we certainly do not promote underage gambling.”
Maryland and Connecticut are separately moving to ban betting companies from signing deals with public universities in which they pay schools to help them market their sports betting platforms.
“I think it is outrageous,” Connecticut State Representative Amy Morrin Bello, Democrat of Wethersfield, said of the agreements that certain betting companies had signed with eight universities around the country. Her bill banning the deals passed this month by 142 to 0.
Ms. Morrin Bello and Mr. O’Dwyer said their regulatory moves were prompted by reporting by The New York Times last year on the explosive growth in sports betting in the United States, including marketing on college campuses.
Ohio’s casino control commission has imposed 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 it illegally claimed bettors could make “free” bets and mistakenly mailed out 2,582 advertisements to state residents under the legal betting age of 21, urging them to download its mobile app and claim $200 in free bets.
Penn Entertainment, another major sports betting company that operates under the brand Barstool, was separately fined in February. Late last year on the University of Toledo campus, Barstool hosted a college football show that promoted the company’s mobile sports betting application despite a ban in advertising targeting anyone younger than 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 logos affixed to players’ jerseys for the professional soccer team based in Columbus, Ohio, a practice he called “entirely offensive,” given that these players are heroes to many youths. “Their greed trumps the common sense that they should be employing when looking out for the harm to minors,” he said, adding that he does not currently have the authority to ban betting sponsors from appearing on jerseys.
The surge in abusive behavior targeting 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 bettors in January, just days after Ohio legalized sports betting.
In a hearing last month in Illinois, Josh Whitman, the athletic director of the state’s flagship university, asked legislators to continue to prohibit the state’s sports books from accepting bets on in-state college sports. He presented legislators with a letter, signed by representatives from many of the state’s universities, that included five pages of crude and at times racist remarks made online to players and teams.
Chris Boucher, a forward for the N.B.A.’s Toronto Raptors, described on a podcast in March one of the hateful messages he received from a bettor. “I chose the wrong slave today,” the person wrote to Mr. Boucher on social media after losing his bet.
“In its purest form, players feel insulted that sometimes fans act as if players are playing for the purpose of them betting,” said David Foster, the deputy general counsel of the union that represents N.B.A. players. “When it crosses the line and becomes harassment and threatening, that’s even worse.”
While the specific language differs, legislation or rule changes proposed or approved in Ohio, West Virginia and Massachusetts this year would broadly allow state officials to bar bettors who threaten or harass athletes.
The industry has supported the proposals, saying it abhors that kind of behavior toward athletes.
“There’s absolutely no place for that,” said Casey Clark, a senior vice president at the American Gaming Association, whose members include most major casino companies as well as FanDuel and DraftKings. “And anybody taking their reaction to losing a bet to that 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 rules.
That includes revisions to the American Gaming Association’s “responsible marketing code” endorsing the ban on the term “risk free” bets and prohibiting marketing partnerships with colleges. The professional sports leagues and some television networks have joined to create what they are calling the Coalition for Responsible Sports Betting Advertising, making statements like “sports betting should be marketed only to adults of legal betting age.”
Mr. Clark said the industry took steps to confront emerging issues before regulators, reflecting a commitment “to provide the right kind of consumer protections that will enable a sustainable legal sports betting market.”
Brianne Doura-Schawohl, a lobbyist representing the National Council on Problem Gambling and other organizations, said the move to tighten rules was a response to the sloppy job state officials did enacting laws legalizing sports betting in so many states since 2018.
“These are discussions that should have happened prior to legalization,” she said.
The moves overseas by regulators, Ms. Doura-Schawohl added, reflect what could be coming next if the U.S. sports betting industry does not move rapidly to head off problems that have emerged in countries where in some cases sports betting has been legal for many years.
Australia is preparing to ban the use of credit cards to place online bets, which now constitute about 20 percent of wagers. Belgium and the Netherlands, as of this summer, will ban gambling advertising on television, radio, newspapers and in public spaces.
“If you have untargeted advertisements — 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 “potential harmful impact on the most vulnerable population, underage persons, remains high.” And in the United Kingdom, the government agency that oversees online gambling released a long-awaited study last month that concluded “change is needed now” as “gambling poses the risk of becoming a clinical addiction,” proposing “financial risk checks” for bettors who lose more than $160 a month and endorsing 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 some of these moves were proposed in the United States, as it has to the pending limits on advertising on sports betting in Maine, which it considers excessive.
“We have always wanted to learn from more mature markets,” he said, but added, “We don’t support restricting when we can market legal, regulated business.”
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