The sports betting market in the US is growing, and the Congress could be looking forward to adding federal oversight to the market. Draft legislation to add oversight surfaced recently from the office of retiring Senator Orrin Hatch. The 37-page document was obtained by ESPN and is being viewed as the first in a series of several drafts that will help in solidifying the concept further.
The legislation allows wagering on professional as well as collegiate sports and required the states to apply for the US Attorney General’s approval when implementing new laws and regulations related to sports betting. Not only this, but the new regulations will also force the sportsbook operators to use official league data until the year 2023 (at least). It would also create a mechanism for the authorities to target unlicensed operators, both domestic and offshore.
The bill also makes provisions for the National Sports Wagering Clearinghouse, an entity dedicated to collecting anonymized data related to sports betting in real-time. It would collect data related to the type of wagers, amount of wagers, time and date along with the place where the bet was placed and the outcomes. The clearinghouse will detect unusual betting patterns in the industry.
The legislation is designed to address a comprehensive list of topics in the sports betting industry. It takes into account advertising related to sports betting and problem gambling, which would need an amendment to two federal gambling statutes. It seeks to amend the Wire Act of 1961, allowing other operators to operate cross-border and the Sports Bribery Act of 1964 by adding wagers based on non-public information as violations, along with extortion and blackmail.
The draft bill is the first attempt at the federal level to bring nationwide regulations in the sports betting industry since the downfall of PASPA this May. PASPA kept sports betting activities limited primarily to the state of Nevada. Since May, a handful of states include New Jersey, Mississippi and Delaware have quickly created new sports gambling regulations while others are still considering the proposal.
Sports betting opens a new source of revenue for the states, but it will be interesting to note how the new regulations from Hatch could affect the states’ earnings. He was one of the proponents of PASPA and has expressed his support for federal regulations in sports betting. Sen. Chuck Schumer also released his version of a possible federal sports betting framework this summer.
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