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Penn Entertainment could face sanctions from Massachusetts regulators as a result of a comment made by an ESPN anchor earlier this year regarding “risk-free” gambling.
The Massachusetts Gaming Commission voted Thursday (June 6) to hold an adjudicatory hearing for Penn Sports Interactive, the operator of the ESPN BET brand, regarding a possible violation of the state’s prohibition on calling a promotion “risk-free” if it requires players to wager something of value.
During an ESPN studio segment on March 24 that was focused on potential wagering opportunities, anchor Rece Davis told his colleague Erin Kate Dolan that “some would call this wagering gambling; I think the way you’ve sold this is risk-free investment, that’s the way to look at it.”
Davis was criticized heavily for the remark, and later clarified it was a joke and said: “I’m sure most recognized my comment was tongue-in-cheek.”
“As we all know, such a thing does not exist. Obviously there are risks,” Davis wrote on X, formerly Twitter, later in the day. “Though I’m not a gambler, I strongly encourage those who do partake, do so with prudence, care, caution, fiscal and personal responsibility, and never over-extend.”
However, throughout the segment, a graphic at the bottom of the screen promoted wagering odds, with a tag in the corner saying “Odds by ESPN BET,” and Massachusetts commissioners have long been concerned with the connection between Penn’s media partners, previously Barstool Sports and now ESPN, and the gaming operations.
“This reminds me of the ‘can’t lose parlay’ [promotion] that we delved into with Barstool, and this is something I’ve been waiting to come up,” said commissioner Eileen O’Brien. “I want to see, is this a one-off? Have there been other references in this vein?
“It’s an area that I, as one commissioner, am concerned about, sort of this cross-pollination between the ESPN commentators and the lines and the betting and the commentary they make.”
“It certainly is a case of first impression for this commission, although I know it has some similarities to the prior issue we’ve heard relative to the ‘can’t lose parlay,’ so I agree this should come back before the commission as an adjudicatory hearing,” added commissioner Nakisha Skinner.
Key Operators Ask For Data Privacy Variances
The commission also voted to approve and file with the Secretary of State an updated version of the commission’s much-discussed data privacy rules that feature several clarifications.
The rules require operators to use personally identifiable information (PII) only for purposes necessary to operate and advertise a sports wagering platform and prohibit operators from sharing that data with third parties without the customer specifically opting in to allow the company to do so.
Another provision of the rule requires operators to “encrypt, hash, or protect, including through the use of multi-factor authentication … all confidential information within their possession, custody or control," and one of the clarifications allows operators to request the commission to permit protecting such data “in another manner that is equally protective of the information in question.”
DraftKings and BetMGM made those requests Thursday, and presented their alternative approaches in a private executive session.
In public filings, both companies said they would not be able to comply with the regulations without the variance.
“Requiring all such data to be encrypted/hashed as the regulation is written is not possible to implement, as it would require all locally stored PII on a patron’s device to be encrypted,” wrote Kevin Nelson, senior manager of regulatory operations for DraftKings, in a filing to the commission.
“In addition, communication with third parties would become impossible, as they would need an ability to decrypt this information to provide required services,” he continued. “DraftKings is skeptical as to whether it would be left with a usable platform were compliance with the letter of the regulation be required, even after several years of development work.”
Following the executive session, the commission tabled the matter rather than approving the requested accommodations.
“We originally had it marked up for a vote to talk about these waivers, as we’re referring to them; we’re going to seek more information after those sessions and table this conversation for another meeting,” said acting committee chair Jordan Maynard.
