Winning sports bettors complaints about limits at regulated U.S. sportsbooks are validated in a recent report from Massachusetts.

For people like myself who have been following the gambling industry for decades, they will likely recall the days when sportsbooks, mostly based in the UK and Caribbean, would quickly cut off or reduce limits on winning bettors or slash limits. Winning bettors were called sharps or wiseguys and were identified as such. Some sportsbooks told them to take their business elsewhere and some cut the limits to such ridiculous lows that they left voluntarily. In the early 2000s, Bet365 (which is now one of the largest companies in the business) was called Bet3.65 by many sharp players since their limits were cut to levels that made betting not even worth it. I recall a huge Australian horse racing bettor showing me a message from the company telling him that he can bet what he would like on other sports but for horse racing his limits were the amount that allowed him to win the equivalent of USD $6. Other large UK companies like William Hill and Ladbrokes followed suit and even some Caribbean books effectively told winning bettors they weren’t welcome. To make matters worse, some online books didn’t cut them off at first, would take the wager but not process it and in the next few seconds a message would pop up that the line had changed and do they still want the bet.

Books admitted that they never had any intent on accepting the wager but wanted to use the information to reset the lines without any liability. In fact, while I wasn’t a large bettor by any stretch of the imagination, I won regularly on awards shows betting at William Hill that I was sent the following letter which I still laugh at to this day. “Unfortunately, we can no longer allow you to wager on any entertainment bets at William Hill but we are happy to take all your bets on football, horse racing or any American sports. Please call us if you have any issues with this matter.” Despite a long conversation with the bet managers there I was told that the decision was final, i.e. like it or lump it. Fortunately, I had many other books only too happy to take my action.

Pinnacle Sports, to their credit, responded to complaints by winning bettors getting cut off or having their limits slashed by saying that winners were always welcome and limits would never be cut. “If we are regularly beat to the line then we fire the traders, not the customers,” was one of the taglines. The Greek Sportsbook, BetCris and some other stalwarts at the time also made it clear that winners were not in jeopardy of being told to take their business elsewhere.

On the other end of the spectrum, consistently losing bettors would be identified by sportsbooks and be offered massive incentives to continue wagering and perks not usually available to the other bettors such as rebates, free bets and deposit matches. There was a lot of talk on betting forums at the time asking whether this was good business or a responsible gambling issue where sportsbooks were taking advantage of bettors who didn’t know better and leading them to become problem gamblers.

That question among others was addressed when legal and regulated sports betting came to the United States and Ontario around 2018, as states and the province made it clear that part of any licensing agreement demanded that sportsbooks take responsible gambling seriously and put in safeguards that would prevent at risk bettors from being targeted. Sportsbooks and casinos said they would use all tools including AI to examine strange betting patterns, deposits that seem to be out of the norm and where possible affordability checks as part of the KYC process. Sportsbooks also said they would ensure that bonuses would not be based on how much a person lost.

Winners & losers in the regulated market

There really was little information on how the RG tools were working until a report was released by the Massachusetts Gaming Commission (MGC) last month that seemed to indicate that the past was just repeating itself in the state. In particular the following two observations were the highlights from that report:

 - Individuals who regularly beat the sportsbooks to the closing line (i.e. consistent winners) were almost always having their limits lowered to ridiculously low amounts.

 - Losing bettors were getting regular rewards and offers to convince them to keep playing with the sportsbooks and more often than not they were higher than what winning or break-even players got.

MGC said this was a problem because lowering betting limits for winners will drive them back to the unregulated industry where the same safeguards don’t exist and most importantly back to a place where they won’t pay taxes. Moreover, MGC said that sportsbooks would just cut limits without an explanation to players or the regulators and this lack of transparency was an unfair practice. As for losers being given better incentives than winners, while that is not specifically an RG issue since many of those losing could very well afford it, it is a very questionable marketing and operations tactic that could lead to problem gambling, particularly if bettors started betting less realizing that they were in a bad place. As one analyst said to me a while back "giving big incentives like matching bonuses to people who lose constantly is really no different than a whisky maker providing buy one get one coupons to their regular consumers who decided to cut back because they were worried they were drinking too much and informed the whisky maker of just that."

It is notable that Massachusetts only legalized sports betting in August 2022, which makes one question how bad the situation has been in states that have had legal sports betting much longer such as New Jersey or Pennsylvania or much larger states with far more bettors like New York or Michigan.

I spoke with Scott who worked in both the offshore and regulated industry before he chose to retire what he thought about some of the data points released by MGC:

“Any sportsbooks that tells you they don’t cut winners are liars. Successful sportsbook management is all about knowing your customers and ensuring the liability from the winners will not offset wins from losers. Sharps are important for helping set the lines but even then, they agree to limits and understand that they must place wagers before the lines are opened to the general public. And sportsbooks which say they don’t offset liabilities with each other are lying too. This is a business and like every business you can’t survive if you operate at a loss.

I really have no opinion on incentives for losing bettors since few places I worked for gave out freebies, but again it’s a business decision and it goes back to the early days of gambling. In the 1950s free alcoholic drinks and comps like hotel rooms and meals were incentives at places like the Flamingo when it was run by Bugsy Siegel. Large bettors always said that they want to be coddled and this was the best way to do it with in-person casinos. And online the only real option is free bets, deposit matches and in some cases, as BetFanatics is doing, with merchandise. It has nothing to do with enticing them with perks so they’ll lose more, it’s to give them some incentives to play with you over competitors and there’s nothing wrong with that.”

Practices not limited to the U.S. market 

While MGC highlighted these issues, it is clearly a problem worldwide. The UK Gaming Commission has issued many large fines since covid against operators that were targeting losing bettors. In the past few years the UKGC fined Flutter Entertainment (the owners of FanDuel) £490,000 for sending push notification promotions to individuals who self excluded themselves; they fined 2 sites owned by the Kindred Group £7.1 million for targeting customers that were identified to be at risk; and they gave William Hill the largest fine ever of £19.2 million in 2023 for money laundering violations and for allowing bettors to deposit large amounts without proper affordability checks. The Netherlands issued many fines including a €19.6 million fine to a large online casino in 2024 for allowing at risk bettors to gamble, and the gambling regulator in Finland fined the state-owned gambling monopoly €2.9 million for failing to prevent problem gambling in that country. Sweden issued over 10 fines in 2024 as well all dealing with targeting problem gamblers, the key point being they lost regularly. And just this week the AGCO in Ontario fined The ScoreBet CAD$105,000 for allowing a gambler to deposit $2.5 million and lose $230,000 which the regulator said failed to meet regulatory expectations.

Most companies didn’t respond publicly to the allegations and simply paid the fine although Flutter responded essentially saying “we’ll do better.”

“Flutter’s ambition is to lead the industry in safer gambling and we apologize for this mistake. The push notification in question was sent in error and, once discovered by our team, we took immediate steps to rectify the issue and proactively notified the Gambling Commission. We know that neither Paddy Power nor the regulator received any complaints about the message. We continue to work closely with the Gambling Commission in all areas and we are committed to operating at the highest possible levels of responsibility.”

A recent report indicated that almost USD$185 million in fines was levied by all Gambling Commissions in 2024 almost all relating to money laundering or targeting self excluded and problem gamblers which the commissions called social responsibility violations. In the United States $9.5 million in fines was leveled by various state gambling commissions in 2024 although $7.5 million of that was aimed at MGM for allowing Wayne Nix, a notorious illegal bookmaker to gamble at MGM Grand and the Cosmopolitan in Las Vegas which violated money laundering rules.

That brings us back to the question of whether the industry has not learned from the past? I spoke with Robert who consulted with the U.S. government in the past on AML rules and he said that casinos always said they did their best, but today it’s no excuse.

“When I worked for the government way back when the casinos told us they did everything in their power to identify suspected money laundering but things just slipped through the cracks. They still got fined, but were given some slack. But back then there were only physical casinos. Now with all the tools available to casinos and sportsbooks there is no excuse. AI tools and new data analytics that have been developed in response to internet betting makes it far easier to highlight suspicious activities and stop the activity before it gets carried out. And for AML it’s very easy to identify if deposits are from drug sources or similar. I still shake my head at that casino in Canada that allowed people to buy chips with hockey bags full of $20 bills. The same is true with tracking people with tendencies that could indicate problem gambling. I have worked with some of the people on staff of these casinos and am amazed at what is available now that wasn’t available then. It’s this intense scrutiny that is catching sports players that are cheating to support a gambling habit and similarly they can identify suspicious patterns that indicates problem gambling. So if they are letting problem gamblers slip through the cracks, it’s because they want them to.”

While Robert’s comments were quite harsh it does take us back to the issue at hand that was identified by MGC. Why are losing bettors being given incentives to lose more if they know they could be feeding people who are chasing losses and why are winning bettors being cut off without so much as an explanation or a warning? If the industry is serious about being transparent and taking responsible gambling seriously then bettors should at the very least be sent a letter telling them that they seem to be betting erratically and asking serious questions on whether they can afford the bets, rather than being given bonuses to bet more or a notification on their account that reads something like "Bet365 is committed to Responsible Gaming" and listing things like considering time outs, creating loss limits and doing some self assessment. If a player is truly chasing losses, it should be up to the book to show them why they suspect the player is doing this rather than putting up a form letter that very few will look at.

Indeed, it seems that despite all the promises and rhetoric, the management of legal, regulated sportsbooks of today have learned little from the sportsbooks of old who were only too happy to do whatever it takes to get losers to gamble more and winners to gamble less.

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