Sportsbook operators pledged Wednesday to work with MA sports betting regulators on solving limiting issues but also said they do not believe it is a major problem.
Unlike a scheduled conversation earlier this year on MA sports betting limits, all eight licensed sportsbook operators offered insight into their practices during a Massachusetts Gaming Commission meeting. Bettors and industry experts participated in the second half of the meeting.
The discussion comes as the MGC said it has received many complaints from sports betting customers about being limited by sportsbooks.
“We’re here trying to solve a problem, we don’t want to start an uncomfortable conversation for fun,” Interim MGC Chair Jordan Maynard said. “We see the differences in complaints. We’re concerned about the casual bettors that get caught up in the controls. We have to come up with better ideas, always want to create a better mousetrap.”
Operators open to working with commission
Representatives from licensed Massachusetts sportsbooks laid out how they decide to limit users. Jeremy Kolman, deputy general counsel at BetMGM, said it limits approximately 1% of Massachusetts bettors.
Cory Fox, FanDuel vice president of risk and compliance, said very few limited bettors show up in customer service. Regardless, he and the other operators said they would work with the commission to cut down on limiting casual bettors.
“We are happy to work with the commission and staff to think about solutions that would resolve this,” Fox said. “I reemphasize it is a tiny percentage of users limited, and many who wrote in are not at all confused about why they are limited. There isn’t a confusion with the vast majority. We’re talking about a small minority of a minority.”
Factors sportsbooks look at to limit
Sarah Brennan, BetMGM senior director of compliance, said the sportsbook looks at wagering patterns, irregular behavior and bonus abuse to make limiting decisions. Kolman said BetMGM looks at a number of factors from bettors, including:
- Capitalizing on errors
- Syndicate betting
- Wagering inconsistent amounts
- Betting on markets with lower liquidity and higher volatility
Kenneth Fuchs, Caesars COO and head of sports, said the sportsbook also looks for suspicious activity related to geolocation, anti-money laundering, bots and account sharing.
When sportsbooks might limit
MGC Commissioner Eileen O’Brien asked if limits only come after winning bets.
Fox said the risk management team reviews wagers players make and the outcomes of those bets. Fox said ultimately the limited users are extraordinarily small, with 0.043% of wagers in 2023 placed at the maximum amount for an individual.
Alex Smith, Fanatics SVP of regulatory compliance, said a small number of bettors end up in review, and “half of the small population are net losing at the time they were limited.” He said 90% of Fanatics winners are not restricted.
“We’re not looking at results, it’s the way they’re wagering,” Smith said. “The notion that if you win, you’ll be banned is not statistically correct.”
Banning versus limiting in MA sports betting
O’Brien said complaints suggest sportsbooks are trying to “ban or bankrupt” customers.
Fuchs offered clarification on sportsbooks banning users compared to limiting their wager amounts.
“Banned is because of illegal activity or consistent violations of terms of services,” he said. “We’re not banning customers for beating us, they can still get bets down.”
Regulated market important in MA sports betting
Maynard said the discussion is key to helping ensure operators efficiently attract bettors to the regulated sports betting market.
Prime Sportsbook executive director Joe Brennan Jr. said limited bettors have few options except to turn back to the offshore market. Brennan said using information from every bettor, rather than limiting them, can ultimately help the sportsbook.
“The players, in essence, are working for us in a way,” Brennan said. “They have better knowledge, better models, and we have to cover hundreds of sports and thousands of markets.”
Transparency key in Massachusetts
O’Brien hopes for more transparency and data on player limitations from the companies. Richard Schuetz, CEO of American Bettors Voice and a longtime casino executive, agreed clearer explanations from operators would be a step in the right direction.
Schuetz said the online gambling industry is different, more recreational and profit-focused than Las Vegas sportsbooks.
He argued online sportsbooks have hundreds of pages of confusing terms and conditions and if a bettor violates them, they are limited and given an explanation full of “obtuse language.”
Responsible gambling issues arise
During the operator session, the companies said they have separate risk management teams and responsible gambling teams reviewing customers. The second session combined the two issues.
Problem gambling consultant Brianne Doura Schawohl asked if the risk mitigation efforts come at the expense of the consumer.
