AGA and NGCB Argue Against Federal Sports Betting Regulations

Sara Slane AGA - Sara Slane Federal Sports Betting Regulations

Sara Slane argued that federal sports betting regulations would hurt legal sportsbooks and kill American jobs.

In dramatic testimony before the House of Representatives’ Judiciary Subcommittee on Crime, Terrorism, Homeland Security, and Investigations on Thursday, representatives of U.S. gaming companies made the case that an overly regulated US sports betting market would help illegal offshore sportsbook operations to thrive.

The subcommittee of the House Judiciary Committee met with proponents and cricits of the US gambling industry on Thursday to discuss possible federal regulations of sports betting.

The Crime and Terrorism Subcommittee’s chairman, Jim Sensenbrenner, called the hearings after U.S. Sen. Orrin Hatch (R-Utah) and U.S. Senate Minority Leader Charles Schumer (D-New York) called for federal regulations on sports betting.

The Thursday hearing showed bitter divisions in how US gaming law is structured. A spokesman for the NFL claimed that free and open sports betting in the United States would undermine the integrity of sports, hurting the NFL’s product in the eyes of the US public.

For that reason, the NFL argued for a comprehensive set of US federal regulations to oversee sports betting in the United States. Such regulations would undercut state sports betting laws passed in New Jersey, Delaware, Mississippi, and West Virginia over the past few months — or Nevada’s longstanding sportsbook laws.

Sara Slane on Federal Sportsbook Oversight

Nevada Gaming Control Board chairwoman Becky Harris and American Gaming Association (AGA) Senior VP of Public Affairs Sara Slane disagreed with the NFL’s stance. Both said that federal regulations were not needed. In fact, Harris and Slane argued that federal sports betting laws would harm the US gaming industry and benefit the kind of offshore bookmaker sites that anti-gambling advocates tell horror stories about.

AGA spokeswoman Sara Slane┬ásaid, “AGA does not believe an additional layer of federal regulatory oversight is needed. Just as Congress has refrained from regulating lotteries, slot machines, table games, and other gambling products, it should leave sports betting oversight to the states and tribes that are closest to the market.”

Becky Harris on Illegal Markets

The NGCB’s Becky Harris made a similar point. Harris noted those who want to ban sports betting only push it underground, where money laundering for organized crime and terrorist networks is a legitimate concern. Harris made the distinction with regulated and licensed sportsbooks, which operate as any other legitimate business in the US financial system.

The chair of the Nevada Gaming Commission, the only US regulator which has overseen sportsbooks for decades, said, “Sports betting scandals are more likely to occur in illegal markets where there is no regulatory responsibility, where monitoring betting patterns is of no concern, and were line movements may not matter.”

Jim Sensenbrenner on DC Regulations

Jim Sensenbrenner (R-Wisconsin) seemed to agree with Harris and Slane. Sensenbrenner, who is retiring at the end of the 115th U.S. Congress, said unlicensed offshore bookmakers could undercut heavily-regulated US sportsbooks, because they do not have to pay taxes or have to deal with limiting regulations.

Rep. Sensenbrenner said, “If I were running around with a fistful of money that I wanted to bet, where would I go when the illegal sportsbook is offering all of these other goodies that a legal sportsbook cannot?”

Competitive Odds and Legal Sites

Sara Slane told the subcommittee chairman he was entirely correct. Slane added, “You hit the nail on the head. Sports betting is a low margin business, so in order for us to compete with the illegal market there has to be the policies in place that allow us to offer competitive odds and drive traffic to our legal sites.”

It is an argument designed to appeal to Republican lawmakers in particular. Many GOP legislators are against business regulations, because conservative doctrine suggests that regulations hamstring businesses, lowers profits, and costs jobs. Sara Slane and Becky Harris tailored their arguments to the GOP members, who hold the majority on the subcommittee.

US Federal Sportsbook Regulations?

The global gaming media often reports that the U.S. Supreme Court repealed the Professional and Amateur Sports Protection Act (PASPA) on May 14, ending the US federal government’s role in sports betting. That is only half-correct. PASPA was repealed, but the Supreme Court left the door open to the federal government insinuating itself into sports betting law in the future.

The SCOTUS ruling said that the federal government cannot ban sports betting in some states and make it legal in others. If it chooses to ban sports betting in all 50 states, that is constitutional. The federal government also has the authority to pass regulations in all 50 states, if those regulations are uniform. That was being discussed by the Subcommittee on Crime and Terrorism.