The New York Times examined thousands of pages of documents and interviewed lobbyists, executives, lawmakers, regulators and others to understand how the sports-betting industry grew so big so fast.
Four years ago, it was illegal to gamble on sports in most of the United States. Today, anyone who turns on the television or visits a sports website or shows up at a stadium is likely to be inundated with ads to bet, bet, bet.
The New York Times has spent nearly a year investigating how the sports-betting industry got so big, so fast — and what the consequences are likely to be for public health, taxpayers, the sports world and more.
After the Supreme Court opened the door to sports betting in 2018, lobbyists pushing for the legalization of online betting lavished state officials with gifts, parties and millions of dollars in donations, at times skirting campaign finance rules. Many lawmakers proved pliant.
The gambling industry used dubious data to push to legalize sports betting, in part by predicting states would be greeted by gushers of new tax revenue. A Times analysis of the industry’s claims found that many of the projections, at least so far, have been wildly optimistic.
That is in part because lawmakers handed gambling companies lucrative tax exemptions. These exemptions essentially subsidized their efforts to lure customers with supposedly risk-free bets and other promotions.
For example, The Times found that companies have paid at least eight universities to let them promote gambling on campus. In a deal between the betting company PointsBet and the University of Colorado Boulder, for example, each time someone downloads the PointsBet app and uses a special promotional code, the university pockets a $30 fee.
It agreed to buy Barstool Sports, a controversy-courting suite of websites, podcasts and more. Barstool’s founder and ringleader, David Portnoy, has a history of misogynistic and racist behavior — and now has become one of the sports-betting industry’s most prominent spokesmen.
The federal government doesn’t regulate sports betting. A Times survey of states that have legalized such betting found that the enforcement of rules has been haphazard, that punishments have tended to be light or nonexistent and that regulators are counting on the industry to police itself.
The more people bet, the more states collect in taxes. While also seeking to protect consumers, regulators have an incentive to help gambling companies get up and running quickly. Some states let them begin operating before regulators complete comprehensive licensing reviews.
The sports-betting industry has been creative in devising ways to persuade people to keep betting even after they lose money, but tools to make it easier to quit — some run by gambling companies, others by states — do not always work. In Indiana, for example, people who sought the government’s help to prevent them from gambling found that they were still able to place bets. Dozens did so.