Mobile sports betting launched on Friday in Massachusetts and the expansion of gambling onto smartphones in every corner of Massachusetts will come as the newly-legal industry finds itself under investigation by regulators and facing scrutiny from the state attorney general.
The state Gaming Commission voted unanimously Thursday afternoon to award certificates of operation to Barstool Sportsbook, BetMGM, Caesars Sportsbook, DraftKings, FanDuel and WynnBET, allowing those six mobile companies to join the in-person wagering operations that have been running since Jan. 31 at Plainridge Park Casino, MGM Springfield and Encore Boston Harbor.
"We wish each of those who are operating best of luck and, again, we reiterate our commitment to the safety and consumer protections and health and integrity of the gaming tomorrow. We know that and we have confidence that each operator is putting all of those concerns at top of mind," Chairwoman Cathy Judd-Stein said after the final vote. "So, good luck."
There are four other mobile operators initially cleared by the Gaming Commission that plan to eventually take bets in Massachusetts: betr will launch in April, BallyBet and Fanatics are expected to launch in May, and Betway is planning to wait until next year to launch. The commission can also issue sports betting licenses for the state's horse racing simulcast centers.
And though it marked another milestone after months of work under public pressure, giving the final green light to launch mobile betting in Massachusetts was not exactly a celebratory affair at the Gaming Commission on Thursday. Its lengthy meeting featured discussion of violations or potential violations by operators, and a presentation from Attorney General Andrea Campbell's office on concerns that young people in Massachusetts could be "unduly exposed to potentially addicting products" through ubiquitous marketing and promotion efforts and the design of mobile betting apps.
"As we approach Friday, we are seeing betting apps being promoted through credits and even referral bonuses, which often lock users in for a particular period of time or until they have spent a particular sum of money. These promotions are not permitted in other industries that pose public health risks, like the sale of alcohol or marijuana, and the burden should be placed squarely on the operators to show why any particular promotion should be permitted here," First Assistant Attorney General Patrick Moore said Thursday morning.
Moore continued, "Let's consider how one of those promotions may operate as soon as tomorrow. Take, for example, a dorm of upperclassmen at one of Massachusetts' many colleges and universities. Inundated with advertising, one student realizes a referral bonuses available. Within hours, a dorm full of students have downloaded the apps, one benefiting from referring another. Now the weekend's activity is sportsbetting, brought to you by referral bonuses, with potentially habitual use thereafter. Is this the safe and responsible gambling that we intend to foster?"
After the presentation from Moore and other attorneys, commissioners said they are open to adjusting their sports betting regulations to address the concerns of Campbell's office.
"I'm hearing each one of you indicate to us there are ways that we can make our regs better. And when we hear that, we are all ears," Judd-Stein said. She asked attorneys from Campbell's office to provide the commission with specific proposed language before the promulgation process for advertising regulations wraps up on March 23.
The chairwoman also asked Moore whether there was anything that the commission could do to improve its regulations or oversight of sports betting companies before mobile betting goes live Friday morning, though the commission did not act on the suggestion Thursday. Moore said one "considerable concern ... which we think is potentially fixable in the very short term" is the way that social media and connected TV platforms like Hulu or YouTube TV might direct ads at people younger than the betting age of 21.
He said many of those platforms allow people under a certain age to be excluded from an advertiser's audience. "Where that capability exists, the operators should be required to use it," he said.
"I watch the Celtics every night, I watch with my 10-year-old on connected TV," Moore said. "He's getting the message that to enjoy the Celtics game, he's got to bet on it. That's not the message that we should be leaving 10-year-olds in the commonwealth."
Three specific ads for FanDuel were brought to commissioners' attention Thursday after they were flagged by Commissioner Eileen O'Brien for potential violations of advertising regulations and reviewed by the commission's Investigations and Enforcement Bureau.
One ad referenced iGaming, another suggested bettors could get "free bets," and a third promoted the use of credit cards or prepaid cards to bet, which is illegal in Massachusetts. The Gaming Commission's regulations also prohibit ads that imply sports betting is "free of risk."
"I want this brought up in front of us for some sort of action. To me, right out of the gates to have 'free bets,' iGaming, and implying you could use a credit or prepaid card, to me you have myriad of violations all happening right before launch," O'Brien said. She said she saw some of the ads while watching broadcast TV and some while watching on Hulu.
Chief enforcement counsel Heather Hall said two of the ads have already been taken down and that FanDuel was in the process of removing the ad that referenced credit cards. O'Brien said that FanDuel has been responsive to her concerns, but highlighted that the potential violations were not self-reported.
"They're responding to us flagging them, and we are inundated with ads," O'Brien said.
Sen. John Keenan this session filed a bill (SD 766) that would effectively ban "advertising and promotion of wagers ... related to any: (1) bonus promotions, (2) same-game parlays, (3) odds boosts, or (4) risk-free, no-sweat, or other free wagers commonly understood to have a similar meaning and utilized to attract a person to patronize a qualified gaming entity" as deceptive acts under the state's consumer protection act.
And the commission also heard more details Thursday on the second incident of illegal bets being accepted at Encore Boston Harbor, this time involving Boston College women's basketball games on Feb. 12 and 19.
Within days of in-person betting launching on Jan. 31, all three sportsbooks had taken bets on regular season college games involving a Massachusetts school, which is prohibited by the state's betting law. The Gaming Commission plans to hold adjudicatory hearings Tuesday on the first two violations that came to light -- an earlier illegal bet on BC women's hoops at Encore and illegal bets on Merrimack College men's basketball at Plainridge Park Casino -- and has also been briefed on MGM Springfield's illegal acceptance of bets on Harvard University men's basketball games.
O'Brien said Thursday that she is more concerned about the potential violations of commission advertising regulations than she is about the illegal collegiate bets. She suggested that the commission include a placeholder item on each meeting agenda for the IEB to brief commissioners on advertising and suspected violations.
"The illegal bets are caught, they're stopped, they're refunded, they can be fixed ... the risk to the consumer and the violation of the statute is stopped immediately, and then you can deal with consequences," she said. "I do want to have a conversation about how are we going to deal with anything that we view as an advertising violation because this concept that if it doesn't get picked up or brought into a process, it's going to continue to be -- potentially in violation of our regs -- put out to the citizens of the commonwealth. And so I'm wondering how we can fast track things like advertising violations because they're a little harder to put back in the bottle as opposed to immediately stopping and refunding an illegal bet."
