The U.S. sports betting sector is abuzz with the contentious SAFE (Supporting Affordability and Fairness by Empowering States) Sports Betting Act. Unsurprisingly, leaders of the industry have come out against the measure, which many fear could set things back. The SAFE Act adds a new slew of regulation to potentially alter the landscape of sports betting, from customer deposits to online advertising to federal supervision. This may be the start of what is likely to end up being a battles that could span a decade or more between the industry and regulators, but those running a Pay Per Head (PPH) bookie business will want to keep abreast of how this plays out, especially since it is unlikely to impact the bottom line anytime soon.
What is the SAFE Act?
A relatively new bill, the SAFE Act seeks to maintain a consistent standard of regulation all across the nation. Until now, sports betting has been regulated largely at the state level, and 38 states have some form of it had already passed betting laws. Many in the industry consider the addition of fed oversight to be unwarranted given that state-based regulations have been successfully operating for years.
The SAFE Act’s customer deposit limitations is one of the most significant components of the proposed act. New rules would make it so customers could only make five deposits in a 24-hour period and no longer be allowed to make credit card payments to fund their sportsbook. The measures are designed to encourage ‘responsible’ gambling but are widely regarded across the industry as overkill.
The operators also have a big issue with advertising bans. The bill would institute a ban on advertising during live sports events and between the hours of 8 a.m. and 10 p.m., effectively crippling the industry’s capacity to appeal to new customers. FanDuel VP of Government Affairs Cory Fox expressed his concerns over these restrictions, suggesting that they may drive customers to illegal offshore wagering sites and damaging the legal market.
I could carry for advertising restraints, deposit limits and affordability checks for higher bets raised questions in the minds of many people as to whether the bill was really workable or would it actually, help the industry or it hurt it.
Industry Leaders Speak Out
The SAFE Act has been met with immediate resistance. Among the loudest of the critics was David Rebuck, the former head of New Jersey’s Division of Gaming Enforcement, who singled out the federal government for not possessing enough expertise of its own in the sector. The state-based regulatory models are working and there is no reason for federal intervention, says Rebuck.
Rebuck is not alone in bemoaning federal interference, however, as others in the industry have publicly stated that they feel the current approach has been working just fine. “It’s just crazy to me,” Rebuck said during a webinar, “that they think they know more than we do without working together on solutions. The fear is common among many in the betting industry, who view the SAFE Act as meddling that is unwarranted.
Yet another source of controversy is the government’s history of handling illegal offshore sportsbooks. Although state regulators are cracking down on these operations, illegal betting sites still flourish. The American Gaming Association (AGA) has noted that billions of dollars are bet on illegal markets annually. Detractors of the SAFE Act say that if the federal government truly wants to safeguard consumers, it should be concentrating on closing down illegal operators, rather than expanding regulation on legitimate ones.
What Can Pay Per Head Bookies Expect?
At this time Pay Per Head bookies aren’t too concerned with the SAFE Act where their day-to-day is at stake. The bill remains in its infancy and will have a difficult road through Congress, especially with stiff opposition from industry leaders. Election-year politics and the general legislative logjam are also likely to complicate any movement on the bill.
That being said, PPH bookies should keep up with how this unfolds. It’s still business as usual for now but PPH bookies should prepare for any new developments that may arise from the SAFE Act by offering their clients with the best betting experience. The fight over all this between regulators and the betting industry is just beginning, the outcome is uncertain and all we can do is remain apprised of how the fight plays out.
