Proposed Federal Sports Betting Regulations Face Industry Pushback

• Two northeast lawmakers introduced the SAFE Bet Act – a measure to bring federal oversight to the US sports betting industry.
• Removing away from a federal approach in 2018 (the repeal of PASPA), this measure is unlikely to advance.
• It calls for stricter advertising regulations, a ban on sportsbooks accepting credit cards, and AI-driven bettor data research (in the name of responsible gambling).
• State-level lawmakers and industry workers/advocates are coming out to express their disdain for the proposed bill.

NEW YORK – As sports betting continues to grow rapidly across the U.S., two lawmakers have introduced the SAFE Bet Act, a bill that seeks to implement federal oversight of the industry. Introduced by Senator Richard Blumenthal (D-CT) and Representative Paul Tonko (D-NY), the legislation aims to address issues like aggressive advertising, affordability checks, and the use of artificial intelligence in tracking bettors.

However, the bill has sparked significant pushback from operators and state regulators, who argue that states with sports betting have adequate laws.

Why Federal Oversight Is Being Proposed

Blumenthal and Tonko argue that the rapid expansion of legal sports betting since 2018, when the Supreme Court overturned the federal ban, has led to unchecked practices that pose risks to public health.

The legislation would also require sportsbooks to ensure that bettors who gamble more than $1,000 in a 24-hour period can afford to do so.

“This relationship between the gambling industry and sports has reached intolerably dangerous levels,” Rep. Tonko said. “We need a national standard — not to ban gambling — but simply to take back control over an industry that is out of bounds.”

The lawmakers are concerned that sports betting advertising, particularly during live events, is too pervasive. The proposed law would ban ads during live sporting events and prohibit sports betting promotions like “no sweat bets” that entice users to gamble with minimal perceived risk.

The bill would limit users to five sportsbook deposits per 24 hours. Also, it would ban sportsbooks that take credit cards from doing so.

Pushback From The Industry And Regulators

The introduction of the SAFE Bet Act has been met with resistance from sports betting operators and state officials. Industry leaders argue that the legislation is heavy-handed and undermines state regulators who have already spent significant time and resources building their frameworks.

Chris Cylke, Senior Vice President of Government Relations for the American Gaming Association (AGA), said the bill is “a slap in the face” to states and gaming operators:

“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.”

Some state regulators argue that their current systems are robust enough to manage issues like responsible gambling and advertising, and that federal involvement is unnecessary. Representative Dina Titus (D-NV), a vocal opponent of the bill, called it “outdated” and “unwarranted,” reflecting the broader sentiment among critics that the proposed regulations are redundant and could harm the industry’s growth.

What’s Next?

Although the bill has not yet passed, it is likely to face significant debate in Congress. Lawmakers will need to balance the concerns of consumer protection advocates with those of an industry that is contributing sports betting tax revenue in the billions of dollars.

As of now, the bill proposes a three-year federal approval process for operators, with reviews required for renewal.

The SAFE Bet Act will need to overcome strong opposition before becoming law, but it has already sparked a broader debate about the future of sports betting regulation in the U.S. Whether federal oversight is the right approach remains to be seen, as states and the industry push back against what they see as an unnecessary and overreaching effort.

News tags: AGA | American Gaming Association | Chris Cylke | Congress | Dina Titus | Paul Tonko | Richard Blumenthal | SAFE Bet Act | Supreme Court