Three lawmakers have demanded that six betting and prediction-market companies explain how they choose VIP customers and tailor gambling promotions, setting a Nov. 5 deadline for the companies’ chief executives to respond.
Sen. Richard Blumenthal and Reps. Paul Tonko and Valerie Foushee sent the letters on Oct. 22 to BetMGM, Caesars, DraftKings, Fanatics, Kalshi and Polymarket. The lawmakers said they were concerned that operators could use customer data to identify people who repeatedly lose money or show signs of gambling addiction, then offer incentives intended to keep them wagering.
The requests seek details of the data companies collect and analyse, whether their algorithms are designed to predict addictive behaviour, and how such information shapes promotions for particular users. The lawmakers also asked whether artificial intelligence is used to target potential gambling addicts.
The companies were asked to disclose VIP-program enrolment, average customer winnings and losses, and revenue from the schemes. They were also asked about promotions sent to customers who had attempted to close accounts, the perks and services offered to VIPs, selection criteria, account-suspension requests, and indications of problem gambling or serious financial hardship.
The letters cited reports of financial losses, mental-health problems and deaths associated with gambling addiction. They said VIP programmes had become central to independent investigations and litigation involving alleged victims of the gambling industry.
One such investigation, previously covered in September, found that DraftKings admitted a ProPublica journalist to its VIP programme after the reporter imitated behaviours associated with problem gambling. The experimenter was accepted after three weeks and $5,800 in deposits, and was assigned a personal concierge. ProPublica reported that the journalist had lost about $4,500 in one 24-hour period and received four promotional alerts within 30 minutes of setting daily time and deposit limits.
Kalshi has rejected the premise that its Platinum scheme resembles a sportsbook VIP programme. Sudhir Jain, its chief compliance officer and head of regulatory affairs, told lawmakers that Kalshi selects Platinum traders based on trading volume rather than wins or losses, and that selected traders are profitable on average.
Kalshi said it connects buyers and sellers trading event outcomes and collects fees, rather than acting as the house. Jain said the company’s revenue was not equal to customer losses and argued that its structure was fundamentally different from that of sportsbooks. The lawmakers, however, suggested that prediction markets claiming federal oversight through the Commodity Futures Trading Commission were allegedly disregarding safeguards established by state gambling authorities.
The scrutiny comes as sports betting has expanded since the Supreme Court struck down the federal restriction on state-authorised sports wagering in 2018. Americans have wagered more than $600 billion on sports betting since then, while a 2024 Connecticut study found that 1.8% of problem gamblers accounted for 51% of sports-betting revenue.
