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Sportsbooks Snub Massachusetts Gaming Commission’s Wagering Limits Forum

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2024-05-21

Sportsbooks Snub Massachusetts Gaming Commission’s Wagering Limits Forum

Online sportsbooks to the Massachusetts Gaming Commission: Drop dead.

That was the prevailing mood during the MGC’s  “Sports Wagering Operator Wager Limitations Roundtable” Tuesday, in which the regulating body sought answers as to why, how, and when sportsbooks limit their customers.

All of the sportsbooks operating in Massachusetts were invited to attend.

None of them did. (Bally’s — which has a license but does not currently operate in the commonwealth — sent Justin Black, who oversees compliance for the company. There wasn’t much for him to do.)

“They felt some information would be too sensitive to reveal in public,” Interim Chair Jordan Maynard said, noting the sportsbooks wanted to talk in an executive session. “I want to clear the air here: We are required by law to do our job in an open forum in Massachusetts. At times, it can be uncomfortable to have these conversations in public, and we understand it. My fellow commissioners and I are faced with this situation at almost every meeting without the benefit of being able to collaborate before we join a meeting. It’s tough. But transparency is key to integrity of the industry in Massachusetts. This commission will never compromise transparency or integrity.”

Maynard noted all the sportsbooks sent notes to the commission detailing why they didn’t want to discuss the issue in a public forum, and they all came down to the same basic reason: proprietary information.

Fanatics: “We likely cannot provide any further information without divulging what we believe to be proprietary and confidential trade secrets on our risk management policies.”

DraftKings: “Any meaningful discussion on wagering limits would necessarily involve disclosure of the company’s confidential risk management practices and other commercially sensitive business information.

FanDuel: “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 systems.”

And so on.

PENN Entertainment, which runs ESPN BET, saw fit to answer the five questions the MGC had for operators, although it’s clear they weren’t exactly forthright with their answers.

To wit, the first question reads, “Please detail how and why a patron may be limited on your platform, including how you may limit patrons on an individual basis.” 

PENN’s answer, in part: “PENN may limit a patron for various reasons, including taking advantage of or manipulating the sportsbook or abusing promotional play.”

There was no mention of bettors winning, beating closing line value, or any other reasons bettors routinely get limited.

Other commissioners were none too pleased with the sportsbooks’ collective decision to no-show.

“I have to admit this discussion was not as meaningful as I had hoped it would be,” MGC commissioner Nakisha Skinner said. “I do think we have not scratched the surface. … I feel like this was not a good use of our time today being that we didn’t have our primary stakeholders as part of the discussion.”

Brad Hill, another commissioner, was more blunt.

“I share in Commissioner Skinner’s frustration, and I’ll 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 in order to start this conversation,” Hill said. “Although it started today, it didn’t give us the starting point I hoped to get today. It was very disappointing to me.”

So, what did happen at the roundtable? Nothing that anyone who has one toe in the sports betting waters doesn’t already know.

Capt. Jack Andrews, the professional gambler and co-founder of Unabated, told the commission about the whys and what-fors concerning limiting.

Brianne Doura-Schawohl, who runs Doura-Schawohl Consulting, made mention of the fact that losing bettors don’t get limited, and they’re probably the ones that should be. 

Dustin Gouker of Closing Line Consulting filled in numerous blanks, including how data is going to be key to this discussion. He also made mention of Dave Portnoy’s ability to get down seven-figure bets at DraftKings while some people can’t get down a buck. 

And Black, the compliance employee from Bally’s, did the best he could, but it was like asking a cook to farm.

Back in March, the MGC took a step to scrutinize the methods employed by sportsbooks in limiting customers, an issue that had been lingering in front of the commission since January 2023.

During a regular meeting, Andrew Steffen, the state’s sports wagering operations manager, delved into the regulations outlined in the Massachusetts sports betting law, which grant sportsbooks the authority to impose limitations on customers at their discretion.

“The division fully investigated the topic, performed an extensive review of house rules, internal controls, consulted with the legal team, talked to operators,” Steffen said, highlighting the commission’s thorough examination of the matter.

While the rules in the state clearly permit sportsbooks to limit customers, the commissioners expressed their dissatisfaction with the current practices at the March meeting.

“This is the beginning of the conversation,” MGC commissioner Eileen O’Brien said. “Seems to me the regs and the house rules put a tremendous amount of discretion in their hands. The deeper issue here, in terms of individual patrons, particularly in light of some of the coverage out there recently, like VIP credits … is, ‘Why am I limited? What’s the rationale behind that?’”

Skinner also sought clarity on the matter back in March.

“There should be a way for patrons to really understand what will get them limited,” she said. “It’s really at the operator’s discretion, and there’s no way for a patron to know what has happened. I don’t think our regs go far enough.”

All of the commissioners noted Tuesday this was just the beginning of a long discussion on the issue.

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