This guest post is brought to you by Richard Newman. He is an attorney at Hinch Newman LLP focusing on the U.S. advertising and digital media matters. 

Gaming and gambling in the United States is big business.  It is no longer just a brick-and-mortar industry, nor is it still mainly limited to Nevada.  Applicable laws and regulations that govern operators, investors and marketers are growing at a rapid pace.

Many have predicted that a federal sports betting bill will not be seen in the near future.  However, in December 2018 Senators Orrin Hatch and Chuck Schumer introduced the “Sports Wagering Market Integrity Act of 2018 (SWMA).”  The Act is controversial legislation that seeks to advance state participation in sports wagering.  It comes following the Supreme Court clearing the way for states to legalize sports betting in order to encourage tax revenue.

“The legalization of sports gambling requires an important policy choice, but the choice is not ours to make,” Justice Samuel Alito wrote.  “Congress can regulate sports gambling directly, but if it elects not to do so, each state is free to act on its own.”

Approximately seven states have now joined Nevada in accepting sports wagers.  More than twenty other states are currently considering such legislation.

The Sports Wagering Market Integrity Act of 2018 would impose specifc standards and consumer protection features, such as disclosure and advertising requirements.  Acceptance of sports wagers that do not meet certain minimum standards would be prohibited.  As would sports wagering on amateur sporting events (except the Olympics and college sports), and wagers by athletes, coaches, officials and others associated with sports organizations.

“…[S]ports betting is inevitable – so let’s make sure it’s done right,” said Hatch.  “This bill is the first step toward ensuring that sports betting is done right in the states that choose to legalize it.  Just as importantly, it provides protections for states that choose not to go down that path.”

 “…I knew that Congress had an obligation to ensure that the integrity of the games we love was never compromised,” said Schumer.  “That is why I believe the time is now to establish a strong national integrity standard for sports betting that will protect consumers and the games themselves from corruption …I will strongly advocate for this bill to move forward and for Congress to vote to pass federal legislation very soon.”   

The National Football League, National Collegiate Athletic Association, National Council on Problem Gambling and United States Tennis Association have also voiced their support.  Others, including lobbyists representing the gaming industry, oppose federal oversight and believe that gaming regulation should be left to the states and tribal nations.

Key takeaways for betting affiliates

  • The bill would not ban sports betting. In-person and online wagering on professional and NCAA (The National Collegiate Athletic Association) sports would be allowed.
  • The purpose of SWMA is to give the federal government responsibility for approving state-level betting legislation to make sure it complies with a uniform set of standards: protect the consumer; regulate gambling so that it does not encourage addictive behavior; and prevent sporting contests from becoming “fixed”.
  • The legislation doesn’t mention integrity fees (additional taxes on sports betting that goes directly to the major sports leagues).
  • The Act requires the casinos and third-party operators to use licensed sports data from the leagues.

Attorney advertising. Informational purposes only. Not legal advice.

 

Author

Richard B. Newman is an FTC investigation and defense attorney at Hinch Newman LLP. Following him on LinkedIn and Twitter @FTCLawDefense.