One of the United States’ largest online gambling operators tried to water down rules designed to help problem gamblers and protect young and vulnerable people, according to documents seen by the Guardian.
FanDuel lobbied for New York to rethink a proposed ban on gambling platforms from using certain words and phrases to attract people “who are or may be” problem gamblers to their websites.
The company, which is owned by the Dublin-based gambling giant Flutter Entertainment, also opposed a rule prohibiting sports-betting advertisements near college campuses. The state’s legal age for the activity is 21.
Online sports betting has surged since 2018, when the US supreme court struck down a decades-old law that prohibited the practice across much of the US. New York is the nation’s largest market, with more than $2.1bn wagered in the state last month. Operators have spent billions of dollars on advertising as they battle to dominate each new market.
Unredacted documents obtained through a freedom of information request, and the New York state register, detail FanDuel’s objections to proposed sports-betting advertising rules, and how the state’s gaming commission stood firm. Ultimately the rules came into effect in October.
Some memos were initially published in redacted form. The unredacted documents have raised concern among advocates for greater problem-gambling support. Gambling companies that supported regulation before legalization now appear to be trying to weaken them, said Brianne Doura-Schawohl, a problem-gambling lobbyist.
“It’s the biggest hypocrisy,” she said. “It seems not only disingenuous to the public, but also the policymakers that probably took many of them at their word that responsible gambling was a priority.”
The gambling industry is “utilizing consumer welfare and responsible gambling practices to legalize markets”, added Doura-Schawohl. “But when there is an opportunity to influence regulations, they are trying to overturn and undo any obligations they have to the very consumer protections they promised were a pillar of their business.”
FanDuel did not respond to a request for comment. The operator has said it is “committed to protecting our players” and offers tools to ensure they can gamble in a “healthy, responsible way”.
In a memo on 27 September, Edmund Burns, the general counsel at the New York state gaming commission, outlined FanDuel’s objection to a rule he said would prohibit operators from using “keywords or similar methods” to attract people “who are or may be problem gamblers” to their sites.
FanDuel argued the requirement was “extremely subjective and impractical to enforce”, drawing comparison with “a liquor store not being able to advertise to customers who ‘may be’ alcoholics”, according to Burns.
The commission’s staff defended the rule, raising the prospect of a sports-betting platform embedding a phrase like “problem-gambling help” in its website to attract a person typing the phrase into a search engine. While FanDuel suggested eliminating the proposal, or limiting it only to “known” problem gamblers, the commission’s staff said this “would not address the issue appropriately”.
FanDuel also objected to a ban on advertising in the “area of a college or university campus”, on the grounds that this “vague” language “could be read to include unaffiliated residential and commercial areas” nearby.
The commission’s staff defended the ban, which they said was designed to prevent “predatory marketing” from reaching underage students. A gambling advertisement across the street from a first-year college dormitory could be “objectionable”, they suggested, even if it was not on land owned by the college.
Another rule proposed that sports-betting operators be held responsible for “false, deceptive or misleading” statements made by firms marketing their services. FanDuel objected, stating that only affiliates – rather than the operators themselves – should be held responsible. But the commission’s staff defended the rule, insisting that operators “ought to be able and willing to control appropriately” the behavior of affiliates promoting their platforms.
A separate memo, sent by Burns on 25 September, detailed objections by operators including FanDuel to another set of revised rules in New York, for the fantasy sports market. While the fantasy sports industry insists the activity should not be legally classified as gambling, some addiction campaigners claim it is in effect just that.
One rule was designed to hold operators “strictly liable” if they allowed prohibited people, such as minors, to use their platforms. In the event of a violation, companies would be able to mitigate any penalty or sanction by demonstrating good-faith reliance on false information. While FanDuel objected, the commission’s staff maintained the measure was “appropriate”.
FanDuel also lobbied for the removal of a proposed rule requiring operators to run a compulsive-gambling assistance message in their advertisements. It said such messaging “would take up too much space” in its ads, according to Burns, and that its national marketing would need to reflect New York-specific requirements. The company also claimed the enabling New York law only required such messaging on websites.
The commission’s staff defended the rule, stating it was “not inconsistent” with state law. Fantasy sports ads “that reasonably are anticipated to be seen in New York should be regulated appropriately”, they said. All New York’s revised rules for fantasy sports also came into effect in October.
FanDuel also suggested eliminating anti-money-laundering requirements – such as the need to establish internal policies, procedures and controls, and conduct independent audits supplied to regulators – according to Burns and the state register. The commission’s staff defended the measure.
Jim Maney, the executive director at the New York council on problem gambling, expressed concern about the impact of online gambling’s sharp rise across the state. “I think industry could do more to assist,” he said. “It may be burdensome, but we have to make sure that we are protecting the most at-risk populations.”
