As greater scrutiny is falling on
companies for the way they offer extravagant perks to customers who are losing large sums of money, there is another question emerging about this fast-growing industry: how the companies treat their biggest winners.
asserted
companies → fall → winners
States and state lawmakers have raised questions about a practice called "limiting" — a tactic sports betting platforms use to apply the brakes to gamblers who are having too much success.
asserted
who → raise → success
"They have to ensure that the house always wins," claims Brianne Doura-Schawohl, the director for the Campaign for Fairer Gambling.
uncertain
Schawohl → have → Gambling
"I would argue it's not fair, and what makes it more unfair is all of the pervasive advertising tells us all that we can win."
asserted
we → argue → all
Last week, a group of U.S. lawmakers wrote to the major gambling platforms to express concerns about the exploitation of vulnerable bettors by granting frequent losers .
asserted
group → write → losers
"The dangling of perks — which include access to exclusive events, videos from celebrities and athletes, and tickets to the Super Bowl — distract bettors from their financial losses and encourage betting when they otherwise would not," the letter said.
asserted
letter → dangle → betting
Big winners, however, sometimes get the opposite treatment — their bets are often capped at under $20, and even under 50 cents at times, effectively cutting them off.
asserted
bets → get → them
In a 2023 filing with the United States Securities and Exchange Commission, sports gambling company DraftKings explained limiting in fine print: "We follow the industry practice of restricting and managing betting limits at the individual customer level based on individual customer profiles and risk level to the enterprise.
asserted
We → explain → enterprise
"
The "sharp" bettor who can hardly bet
asserted
who → bet → bettor
When Massachusetts launched sports gambling in 2023, Mike Manning signed up with every sports gambling app available.
asserted
Manning → launch → app
Manning — a full-time professional bettor, or what they call a "sharp" bettor — doesn't bet on intuition.
asserted
they → call → intuition
He uses a mathematical approach with analytical models.
asserted
He → use → models
Manning says he was winning on nearly every app.
asserted
he → say → app
Then, one by one, the platforms began limiting his bets.
asserted
platforms → begin → bets
On DraftKings, he said he was limited to $25 per bet.
asserted
he → say → bet
On BetMGM, he started betting $1,000-$5,000 per game, but soon, he said, he was only able to bet $5.
asserted
he → start → 5
Limiting caught the attention of the Massachusetts Gaming Commission in 2024.
asserted
Limiting → catch → 2024
The regulator required gambling companies to answer questions and provide data on how they limit their bettors.
asserted
they → require → bettors
After an investigation last year, the Commission found a trend: Winning gamblers have their betting limit decreased while gamblers who lose have their limit increased.
asserted
limit → find → trend
"It's that whole 'ban or bankrupt' model," said Gadoon Kyrollos, a professional sports bettor whose bets are often limited.
asserted
bets → say → ?
Manning called the disparity in treatment predatory and unfair.
asserted
Manning → call → treatment
"You're exploiting the losing bettor, you're taking advantage of them, and guys like me get shown the door," Manning told CBS News.
asserted
Manning → exploit → News
BetMGM declined to comment.
asserted
BetMGM → decline → ?
The number of accounts the companies limit is small.
asserted
companies → limit → accounts
Massachusetts Gaming Commission found that 0.64% of Massachusetts betting accounts had been restricted.
asserted
% → find → accounts
Matthew Litt, a New Jersey attorney who works on gambling cases, says the practice is legal as long as gambling companies are not discriminating against customers based on protected characteristics such as race or religion.
asserted
companies → work → race
Massachusetts became the first state to require gambling companies to notify gamblers who had been limited and to stipulate why they were being limited.
asserted
they → become → gamblers
FanDuel wrote to Manning that he was restricted because of "an assessment of your overall wagering patterns and their impact on our long-term risk position…"
DraftKings told Manning it took action "for internal risk management purposes."
asserted
it → write → purposes
Another bettor, Michael Trevithick of Ann Arbor, Michigan, shared a betting ticket with CBS News that showed the maximum DraftKings would allow him to wager on the NBA Cup was 49 cents.
asserted
him → share → Cup
A DraftKings spokesperson said the company "applies customer-specific wagering limits to less than 0.15% of accounts as an enterprise risk control, generally in response to activity that appears designed to exploit errors or target discrepancies in odds.
asserted
that → say → odds
These decisions are based on customer behaviors, irrespective of whether a customer is winning or losing."
The VIP who was incentivized to bet more
Chris Swett was once a highly paid South Carolina attorney, but these days he is awaiting sentencing after pleading guilty to four counts of wire fraud and four counts of money laundering in federal court.
asserted
he → base → court
Swett stole about $2 million from his law firm to fund his gambling addiction.
asserted
Swett → steal → addiction
"Every bit of it went into FanDuel," Swett said
A young, successful lawyer with a growing family, Swett discovered Daily Fantasy Sports, a game in which contestants could set lineups of athletes and compete against other contestants for money on FanDuel.
uncertain
contestants → go → FanDuel
By 2019, he was wagering $5,000 to $10,000 a month
asserted
he → wager → 10,000
Then, he says, a FanDuel employee emailed him saying anyone who spent $25,000 a month was eligible to be paired with a VIP host.
asserted
who → say → host
The host would provide him free tickets to sporting events and complimentary entries to fantasy contests, if Swett wagered enough.
asserted
Swett → provide → contests
"When they sent me to the first NFL game, I felt like a high roller," he said.
asserted
he → send → roller
Swett says he was in over his head, but his VIP host kept incentivizing him to bet more.
asserted
host → say → more
In one email from 2020, Swett wrote to his VIP host: "I think I'm tapped out this month..."
asserted
I → write → host
Two days later, the host offered him a 4% bonus on any new bets.
asserted
host → offer → bets
…and 11 more, not listed.
The Aporia
