NY Gaming Commission to limit sports betting ads targeting underage individuals through stricter regulations

The New York State Gaming Commission is taking a stricter approach to online sports betting advertising regulation as it seeks to limit ads, marketing and promotions that target underage individuals and college students. The Commission unanimously approved rules on Monday that further aim to limit exposure to vulnerable populations in the Empire State, while also taking aim at "free" bets and advertising contracts.

The rules have yet to go into effect, as they are set to first go through a 60-day public comment period. Commissioners will then revisit the proposed regulations after the period ends. The move comes amid unflattering media reporting on problem gambling not only in New York but nationwide, and as state lawmakers also seek to take steps to limit advertising.

The proposed regulations are likely to have a significant impact on New York’s booming sports betting industry. The market was remarkably successful during its year of operation, following a launch in January 2022. But while the state has been quick to grab the first spot nationwide, the Commission worries the success might come at the expense of problem gambling.

According to NYSGC Chair Brian O'Dwyer, the regulations should be an effective first step in making sure some of New York’s most at-risk populations, including underage individuals and college students, stop being bombarded with sports betting advertisements. These concerns come as lawmakers in the state have already introduced legislation to modify advertising rules, including a potential federal ban on all televised gambling commercials.

New provisions

The approved rules mandate that a casino sports wagering licensee or sports pool vendor “shall not allow, conduct or participate” in any advertising, marketing or branding for sports wagering that is aimed at persons under the wagering minimum age set forth in Racing, Pari-Mutuel Wagering and Breeding Law section 1332(1).

The new advertising rules would impose restrictions in design, as no ad shall be designed "to appeal primarily to those below the legal age for sports wagering” by depicting cartoon characters, or by featuring entertainments or music “that appeal primarily to audiences under the wagering minimum age.”

They also target the composition of the target audience of the gambling ads. Sports wagering advertising and marketing shall not be placed in broadcast, cable, radio, print, or digital communications where the “reasonably foreseeable percentage of the composition of the audience” is mostly persons under the wagering minimum age.

The regulations state that no wagering messages, including logos, trademarks or brand names, may be used or licensed for use on clothing, toys, games or game equipment intended primarily for underage persons. Sports pool licensees are asked to use “commercially reasonable efforts” to distribute such products only to those who have reached the legal age to wager.

Another point indicates that wagering shall not be promoted or advertised in college or university-owned news assets, or advertised on college or university campuses. Furthermore, the depiction of underage persons in ads is strictly prohibited. And finally, no advertisement for sports betting shall state or imply “an endorsement by a person under the wagering minimum age” as set forth in Racing, Pari-Mutuel Wagering and Breeding Law section 1332(1).

Increased scrutiny

The proposed rules come as state lawmakers consider two responsible gaming bills: S1550 and A1056. The first one seeks to ensure responsible gaming messages are prominently featured on all gambling and sports betting advertisements in the state, while the latter would establish a new problem gambling advisory council in New York.

At the meeting, O'Dwyer said that after one year of legal mobile wagering, it is “obvious” that the new market has been “a net positive” for people in the state. However, he pointed out that the Commission is “also cognizant” that, along with that success, comes the potential for problem gambling.

Brian O'Dwyer

In addition to further limiting advertising targeting underage persons, the new rules would also prohibit "false, deceptive or misleading statements" in ads, ban the terms "free" or "free of risk" if a bettor is risking their own money, and include a requirement to "clearly and conspicuously" disclose all material terms and conditions of a promotion.

In line with a provision that has been proposed in Massachusetts, New York’s proposed rules also contain a ban on advertising contracts with third parties that compensate those parties based on the number of customers acquired or wagers placed.