Two months ago in this space I sounded an alarm: Be careful what you wish for. The subject of the column was a plea from the American Gaming Association for federal help in reining in illegal gambling, from the gray-area skill games we see across America to the illegal gaming and sports betting websites that pick off American bettors from their perches in offshore territories, resulting in fraud and no consumer protection.
It’s not that I think these illegal activities are harmless or should be ignored, it’s just that the open pleas for help from the federal government is like inviting the fox into the hen house. The federal government is more likely to use a sledgehammer on a problem rather than just some tweaks. So I believe it was dangerous to ask the feds for help.
But less than a month after the AGA’s plea—and probably not connected to it—are two proposals that would put the federal government all over the backs of gaming companies that truly want to do the right thing.
In that same edition, we ran a story about responsible gaming treatments, and in a sidebar the author, Marjorie Preston, wrote about New York Congresswoman Claudia Tenney and a bill she was introducing that would impose a federal .25 percent excise tax on all sports betting wagers, but it would apply only to casinos and exclude lotteries, sportsbooks and racetracks. When Ms. Preston called the congresswoman’s office for comment, a spokesman backed off a bit, saying that the bill was a work in progress and a final version will be released later.
While the industry makes millions of dollars in contributions to responsible gaming groups, a federal approach is not only wrong, it’s dangerous. The states where the gambling is occurring should be the ones to decide what and how much their gaming companies should contribute. But better yet, let’s have the gaming companies come forward and set up a program where reputable responsible gaming groups receive a fair share of the pie.
And then last month, another New York congressman—what is it about New York?!—Rep. Paul Tonko, came up with the brilliant idea to ban advertising by sportsbooks.
“The excessive, uncensored promotion of these sites needs to be put in check,” Tonko said in a press release. “My legislation puts a halt to this dangerous practice and sends a powerful message to the online sports betting advertisers. Congress must take the necessary steps to reel in an industry with the power to inflict real, widespread harm on the American people.”
If Tonko’s “Betting on our Future Act” sounds familiar it’s because it is modeled after a similar law that prevented tobacco companies from advertising. If enacted, the law would prohibit sports betting ads on any electronic medium, keeping the ads off television, radio and the internet.
Granted, there have been some sports betting companies that have gone overboard when soliciting for new customers—and they’ve paid for it in real dollars and a make against their reputation. But let’s not forget that sports betting in the U.S. is a relatively young industry, less than five years old. Will it always appear predatory when a sports betting company offers incentives to sign up? If not, where do you draw the line?
The sports betting industry is today heavily competitive, with lots of pressure from investors to produce. And given the fact that there are virtually no sports betting companies yet making money, that pressure increases exponentially with every passing day. That’s why it becomes more important that the members of the industry get together and create a set of advertising standards that will be acceptable to most regulators and ethical for the operators.
The American Gaming Association has an official “Code of Conduct” for its member and an outline for advertising, including sports betting, prohibiting ads that:
- Contain images, symbols, celebrity/entertainer endorsements, and/or language designed to appeal specifically to children and minors.
- Feature anyone who is or appears to be below the legal age to participate in gambling or sports betting activity or imply that underage persons engage in casino gambling or sports betting.
- Depart from contemporary standards of good taste that apply to all commercial messaging, as suits the context of the message or the medium utilized.
- Be placed with such intensity and frequency that they represent saturation of that medium or become excessive.
Now this makes sense, but it isn’t specific enough. What are “contemporary standards of good taste?”
Let’s convene a daylong seminar with all the major players—both operators and suppliers—so we can get down to specifics and decide how much is too much. An effective program that demonstrates integrity and trust will go a long way to keeping the federal government in the cage and make it more straightforward as to what is acceptable and what is not. Let’s draw that bright line.