New York Proposes Rules to Curb Online Sports Betting Addiction

New York gambling regulators formally proposed two rules on Friday that are meant to curb online sports betting addiction, opening what is now the country's largest wagering market to a public comment period that will run 60 days. One rule would require sportsbooks to use specific betting thresholds to identify customers at risk of problem gambling and then check in with them; the other would bar operators from using artificial intelligence to customize bonuses or wagering offers for individual customers.

Both drafts had been in the works for months and were first floated publicly in March, drawing dozens of comments. Their official introduction at the New York State Gaming Commission came after a run of reporting that raised questions about how the largest sportsbook apps treat problem gamblers, including a ProPublica investigation published last month and a New York Times examination of how DraftKings used data scientists to steer promotions toward customers who were losing money. Together the two accounts pushed the issue from an academic concern about gambling expansion into a concrete regulatory question about what operators are required to do when a customer's behavior looks compulsive.

What the two rules would require

The first rule would effectively adopt thresholds New Jersey already uses to flag at-risk bettors, obligating a company that crosses them to intervene with the customer. Among the New Jersey triggers: depositing more than $10,000 in a single 24-hour period, or wagering more than $1 million over 90 days. DraftKings, one of the largest sports betting companies in the country, has said it already follows those thresholds.

The second rule targets personalization. It would prohibit companies from using AI to tailor bonuses or wagers to an individual's betting history — a practice that a federal class action filed in Boston on September 30 also challenges. That suit, brought by a West Virginia man who says he received more than 70 promotional messages in the space of a month, alleges DraftKings built machine-learning models that scored customers by how much they were expected to lose and then promoted to the highest scorers.

The ProPublica investigation that preceded Friday's vote was itself an experiment. A reporter deposited $21,600 into a DraftKings account in less than eight weeks and deliberately bet in the patterns that addiction specialists describe as warning signs. The behavior did not trigger a company review or any intervention beyond standard responsible-gaming notices, and the outlet reported that DraftKings made its journalist a VIP after the red flags appeared.

Regulators say the industry is on notice

Commission chair Brian O'Dwyer framed the proposal as a test of the industry's willingness to police itself. "The industry is on notice by me and this commission that they need to solve this problem," he said. "If the industry does not address it, then we will address it and they may not like the solution that we come up with."

After the commission advanced the rules unanimously on Friday, O'Dwyer acknowledged "the limitations of this proposal" and urged the state's nine licensed mobile sports betting companies to share data among themselves so that problem gamblers cannot avoid intervention simply by moving from one app to another. That gap has become a recurring theme in gambling policy: an operator can flag a customer's deposits internally without knowing that the same person has crossed similar thresholds at four competing platforms.

Gambling reform advocates said the draft rules fall short. Brianne Doura-Schawohl, who lobbies for consumer and public health protections, called New York and New Jersey "clearly complacent in the status quo by endorsing and prescribing regulations that are nothing more than giving the appearance of reform and not effectuating actual change." Her critique lands on the threshold design itself, since ProPublica's own test showed that compulsive betting can take hold at amounts well below the levels that trigger a check-in.

Other states are watching the same reporting

New York is not acting alone. Since the AI-targeting stories appeared last month, regulators in Maine and Massachusetts have said they are examining the issue, and the governor of Maryland has said he wants to limit gambling companies' use of AI to identify and target users showing signs of harm. Maine's Gambling Control Unit said it is "monitoring the use of AI locally and nationally" while acknowledging it has no rules or laws addressing the practice. Michigan regulators have not responded to questions about whether they are reviewing the reporting.

The New York proposal now enters a 60-day comment period. Barring major changes, the rules will return to the commission for a vote. The timeline means the state's nine mobile sportsbooks are unlikely to face new obligations before the end of the year, even as the commission accumulates information from the public about whether the thresholds are set at the right level.

Why the timing matters for treatment

Gambling disorder was reclassified as an addictive disorder in the DSM-5, and the evidence base for treating it rests on behavioral therapy rather than medication — there is no FDA-approved drug for the condition. That makes early detection, the explicit goal of the New York proposal, one of the few population-level tools available.

State data and national surveys have consistently pointed to rising demand for help. People seeking support for a gambling problem can find gambling addiction treatment programs that combine cognitive behavioral therapy with care for the depression, anxiety and substance use that so often travel alongside a betting disorder. Federal law also requires most insurers to cover that care on the same terms as physical health, though enforcement of the mental health parity rule has been uneven.

The practical question New York's comment period will test is a narrow one: whether a deposit threshold is the right instrument for spotting a disorder that specialists say can develop at far lower stakes.