The Sure Bet: How Legal, Regulated Sports Betting Protects Consumers

In just five years New York has set the standard for regulated, legal sportsbetting. With some of the strongest consumer protections in the country, the state has demonstrated how legal and regulated  sports betting can protect consumers, offer the critical transparency demanded to ensure integrity, and promote responsibility while also generating over $1 billion a year in tax revenue to support public education. In contrast, illegal offshore betting websites, who long held a monopoly over New Yorkers, contribute zero tax dollars and shirk every imaginable responsibility to protect consumers and promote integrity. Unfortunately, we have more work to do to fully eliminate these illegal actors, who remain motivated to undermine the safeguards the state has worked so hard to build.

Both law enforcement officials and consumer protection advocates have recently warned the public about the dangers posed by unregulated offshore betting sites. A recent investigation by the Better Business Bureau found a history of these unregulated platforms cheating customers, leaving them with little to no recourse. “With billions of dollars flowing through this global industry, a risky underbelly of pseudo-gambling, illegal gambling and scams has developed,” the Better Business Bureau report states. “Because of the sophistication of these impostors, bad actors and scammers, it can be hard for consumers to tell the difference between a legitimate bookkeeper, casino or betting company and those seeking to deceive or steal from the public.”

Ahead of the Super Bowl, New York State Attorney General Letitia James released a consumer protection alert, warning about the risks of illegal betting markets and encouraging bettors to only use platforms licensed and regulated by the New York Gaming Commission. She noted how unregulated markets are not required to prevent underage gambling, restrict predatory or deceptive advertising, identify customers engaging in problematic behavior, create guardrails to allow consumers to exclude themselves from their platforms, or uphold prohibitions against insider betting. Similarly, a recent letter from a bipartisan group of Attorneys General across the country warned about these operators and called for more enforcement against their illegal enterprises.

By contrast, legal sports betting operators continue to meet critical regulatory standards . Since legalization, online platforms such as BetMGM, DraftKings, Fanatics, and FanDuel have built robust consumer-protection frameworks including responsible gaming initiatives and strict Know-Your-Customer protocols.

Under the regulation of the New York State Gaming Commission, licensed operations are required to use state-of-the-art identity verification technology to ensure bettors are of legal age. When minors engage in online sports betting they are doing so on illegal websites that are often hosted offshore and use cryptocurrency to hide their transactions, not on regulated sportsbooks. In addition to age verification, all licensed sportsbooks have financial rules to ensure secure payment processing, the protection of personal data, and that winning bets are actually paid out. If a player betting legally has any issues, there are avenues to file formal complaints. None of these protections exist in the illegal market.

Unlike offshore sites, the legal market is also committed to ensuring users are playing responsibly, and will offer support, or even revoke access, if they are not. In addition to employing hundreds of staff members dedicated to responsible gaming, these legal apps are equipped with protections integrated into the platform from the moment a user signs up. For example, new players receive prompts and other messaging outlining responsible gaming resources, with intermittent reminders upon subsequent log-ins, and platforms are able to track and analyze user behavior at an individual, anonymous level, allowing them to identify problem gaming in real time. This enables targeted support, including pop-up messages to remind players how long they have been online or connections to responsible gaming resources, if necessary.

The Sports Betting Alliance is proud to support New York’s nation-leading regulatory framework. For New Yorkers who choose to bet on sports, the smartest choice will always be to bet legally, with platforms that you know you can trust and are accountable to the state’s regulators and policymakers.