Operators No-Show At Massachusetts Roundtable On Wagering Limits

May 22, 2024
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Massachusetts regulators were set to have a roundtable discussion with sports-betting operators surrounding the practice of limiting successful customers, but when Tuesday’s meeting came, there was just one thing missing: the operators themselves.
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Massachusetts regulators were set to have a roundtable discussion on Tuesday (May 21) with sports-betting operators surrounding the practice of limiting successful customers, but when the meeting came, there was just one thing missing: the operators themselves.

All ten of Massachusetts’ active sports-betting operators rejected an invitation from the Massachusetts Gaming Commission (MGC) to participate in the roundtable, after initially signaling to the commission that they would attend.

“It is my understanding that they were requesting an executive session to discuss these matters, as they felt that some information would be too sensitive to reveal in public,” said Jordan Maynard, the commission’s acting chair, at the beginning of Tuesday’s meeting. 

The roundtable proceeded anyway with participation by several industry experts, as well as a representative from Bally’s Interactive, a licensed operator in Massachusetts that has yet to launch. Still, several commission members expressed their frustration with the lack of attendance.

“We did have a little bit of a discussion, and I appreciate [their] contribution, but I have to admit the discussion was not as meaningful as I hoped it would be,” said commissioner Nakisha Skinner.

“There’s a lot of information we just don’t have, so on the one hand, I feel like this was not a good use of our time today, given that we didn’t have our primary stakeholders part of the discussion, but I hope we can work to change that going forward, because we need to move this needle in which ever way is appropriate according to this body.”

Commissioner Bradford Hill called the lack of attendance “very disappointing”.

“I share in Commissioner Skinner’s frustration and I will go so far as to say anger that I have today for not being able to get a lot more information that I thought we would be able to get today to start this conversation,” Hill said.

“Although it was started today, it really didn’t give us the starting point that I hoped we would get,” he added.

Maynard said the motivation for the roundtable was the commission becoming aware of reports from customers and media articles about operators limiting winning players to making only very small bets despite those players otherwise abiding by laws, regulations and operator house rules.

“There is a worry that if we have operators limiting patrons who are playing by the rules, that limitation will naturally incentivize those players to turn to the illegal market,” Maynard said.

In emails released by the commission, operators claimed that speaking publicly about their practices of limiting players would require the disclosure of trade secrets.

“As the leading sports wagering operator in Massachusetts, DraftKings believes that its perspective would be helpful to any policy discussion about wagering limits and it would welcome the opportunity to further educate the commission on this topic,” the company wrote. 

“However, any meaningful discussion on wagering limits would necessarily involve disclosure of the company’s confidential risk management practices and other commercially sensitive business information. Therefore, we do not believe that the proposed public roundtable is the best forum for DraftKings to further contribute to this discussion.”

Similar sentiments were expressed by Cory Fox, vice president of product and new market compliance for FanDuel, who wrote that the company did not believe it could have a “meaningful discussion in a public forum about our wager limits and risk management processes”.

“Risk management, similar to trading (i.e., setting prices) is a core part of our business and our value proposition as a sportsbook, and it is critical for FanDuel to maintain confidentiality over our proprietary system,” Fox wrote.

Joe Brennan Jr., an industry veteran who is currently executive chairman for Prime Sports, which operates in New Jersey and Ohio and touts its across-the-board maximum wagers rather than limitations on individual players, strongly criticized the operator no-show.

“All of Massachusetts sports-betting operators refusing to participate in today’s roundtable on the limiting of players is probably the biggest middle finger I’ve seen by licensees in the 20+ years I’ve been in this industry,” Brennan said on X, or Twitter.

Although Penn Entertainment, which operates its ESPN BET platform in the state, did not appear at the roundtable, it did provide written responses to the commission’s questions, including on the impact to the industry if limiting players was prohibited.

“A law or regulation prohibiting or limiting operators’ ability to allow limits would lead to a large reduction in the amount of wager opportunities offered, reduced limits for all patrons (rather than just individual patrons who are manipulating or abusing the system), less sports and leagues available to wager on, and potentially, a reduction in available operators entirely,” wrote Samantha Haggerty, deputy chief compliance officer and regulatory affairs counsel for Penn.

“The typical, recreational bettor would experience a vast reduction in betting options if such a law or regulation were put into place,” she continued. “The result would be a less competitive product offering for the customer and reduced revenues for the Commonwealth [of Massachusetts].”

Commissioners emphasized that although no action was taken on the issue Tuesday, the session was only the first step for the regulator in looking into the practice of wagering limits.

“When we don’t know something, we’re very curious and not judgmental when we try to figure it out,” Maynard said.

“We don’t accept, 'well this is how every other jurisdiction in the country does this'; we see the license as a peerless privilege to operate here.”

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