- Minnesota Sen. John Marty (DFL-40) today held an informational hearing on economic, health, and social harms of online sports betting
- One speaker declared that predatory gambling and gambling companies “want to bring you down.”
- Marty has previously noted he will likely introduce a sports betting bill to dedicate revenues to problem gambling funds
Predatory gambling companies “want to bring you down,” according to one of the speakers who shared his thoughts on legalized Minnesota sports betting during a hearing held today by Sen. John Marty (DFL-40).
Marty, a longtime opponent of Minnesota sports betting, today held a hearing on the economic, health, and social harms of online sports betting with the Senate finance committee. Lawmakers will yet again consider the legalization of Minnesota sports betting when the state’s legislative session kicks off next week.
“There have been many sports betting hearings in Minnesota focusing on the economic benefits of sports betting, but none on the social harms,” he said.
Testifiers Warn of Sports Betting Dangers
Today’s hearing was held a week before Minnesota kicks off its 2025 legislative session. A number of lawmakers have already confirmed they will be introducing sports betting bills during the session and optimism for legalization is high.
However, if Minnesota sports betting becomes legal, it will put state residents with compulsive gambling habits at great risk, according to several witnesses that testified.
March Madness tournament pools, making an occasional wager with a friend, or church bingo is a completely different animal than the predatory nature of legalized sports betting, Les Bernal, National Director of Stop Predatory Gambling, told the committee.
“This is a business that is based on taking you down. It’s an adversarial relationship, and that’s true for all forms of commercialized gambling when it’s being done for profit. We call it ‘the big con.’ What it is at it’s core, what predatory gambling is, it’s taking a dangerous and addictive product and blending it with a fraudulent and manipulative financial scheme. It’s very potent.”
It’s a financial exchange that is mathematically stacked against the user, Bernal said.
It’s true, said Matthew Litt, a lawyer and founder of Litt Law in New Jersey, that casinos and sports betting operators can take advantage of their customers. Litt has filed a number of lawsuits against sports betting operators and casino companies for allegedly taking advantage of customers who are displaying obvious signs of gambling addiction.
Litt is currently representing Amit Patel, a former Jacksonville Jaguars executive who stole millions of dollars from the franchise to fund his daily fantasy sports habit, in a lawsuit levied against FanDuel that alleges the company’s VIP program took advantage of Patel.
“Almost every single addicted gambler had a VIP host who led them to the dire straits they find themselves in now,” he said.
Scott Baker, a professor at Kellogg School at Northwestern University and author of “Gambling Away Stability: Sports Betting’s Impact on Vulnerable Households,” presented data showing that families in states with legalized online sports betting with members who participate have less overall investments, have an overall reduction of financial health, increased credit card debt, and reduced credits than families living in states without legalized online sports betting.
Constituents Want Sports Betting
Sen. Nick Frentz (DFL-18), one of just a few senators to speak outside of Marty, said the testimony at the hearing largely ignores one fact; that Minnesota residents roundly support the legalization of sports betting. Frentz has authored several previous Minnesota sports betting bills and will likely do so again this session.
While statistics do show that between 1% and 8% of Minnesotans who participate in legalized sports betting may develop problem gaming habits, that means between 92% and 99% of participants will not develop a problem gaming habit in the North Star State.
“I think we should have as a goal to see a bill passed that responsibly addresses the latest concerns that states have,” he said.
Sports betting will be a hot topic when the state opens its session. Sen. Matt Klein (DFL-53), who has also introduced several previous sports betting bills, recently told the St. Paul Pioneer Press that he hopes to bring the form of gaming into the legal, regulated world.
“A lot of Minnesotans are already betting on sports on their telephones, on their mobile devices, and they’re doing it illegally and through offshore platforms,” Klein said. “What this would do is bring that activity into the legal sphere. It would have protections around problem gambling and underage gambling. If you legalize it and bring it in-house, then we’re able to make it safer and trustworthy for Minnesotans.”
Marty has also expressed interest in once again introducing his own sports betting bill. Marty recently said he will most likely be refiling another sports betting bill this legislative session. To combat the societal costs of legalized sports betting, Marty’s 2024 bill earmarked the vast majority of sports betting revenue to problem gaming funds.
He introduced bill SF 5330 to the Senate to provide Minnesota tribes with sports betting exclusivity, but earmarking the vast majority of sports betting revenue to combat problem gaming in the state.
His bill instituted a 40% sports betting tax on gross revenue and dedicated 75% of tax revenues to problem gaming funds. Marty’s legislation distributed sports betting tax revenues as follows:
- 50% to the commission of human services. Half of the revenue will fund compulsive gambling treatment programs and half will be for a grant to the state affiliate recognized by the National Council of Problem Gambling to be used to increase public awareness of problem gambling, provide education and training
- 25% to the commission of education for grants for addiction prevention and mental health services in public and charter schools
- 25% to the general fund
Sports Betting Alliance Criticizes Hearing
The Sports Betting Alliance, which represents the interests of BetMGM, DraftKings, FanDuel, and Fanatics, released a statement criticizing the hearing upon its conclusion.
Sports betting in happening in Minnesota right now whether it’s legal or not, Blois Olson, spokesman for the Sports Betting Alliance of Minnesota, said. Minnesotans are forced to use offshore and unregulated websites that ignore gaming laws meant to protect consumers, ensure responsible play, and prevent minors from gaining access.
“That’s why a growing chorus of bipartisan Minnesota legislators have stood up and voiced their support for a transparent sports betting marketplace, one that allows Minnesota regulators to test and approve every product and ensure platforms are used responsibly. It’s also worth noting that Senator Marty, a longtime opponent of sports betting, did not include the perspective of Minnesota sovereign tribal nations who are key stakeholders in gaming in the state. In fact, he did not permit anyone to testify who did not share his perspective – not responsible gaming experts, industry representatives, or experts in the dangers of the thriving illegal sports betting market in Minnesota,” he said.
In a recent hearing in Minnesota, the dangers of legalized online sports betting were brought to light by various experts and stakeholders. The hearing, which was held by the state’s House Commerce Committee, focused on the potential risks and negative impacts of allowing online sports betting in the state.
One of the main concerns raised during the hearing was the potential for increased problem gambling and addiction. Studies have shown that the convenience and accessibility of online betting can lead to a higher prevalence of problem gambling behaviors. This is particularly concerning in a state like Minnesota, where there are already high rates of gambling addiction.
Another issue that was highlighted in the hearing was the potential for increased fraud and corruption in sports betting. With online betting, it becomes easier for individuals to manipulate outcomes and engage in illegal activities such as match-fixing. This not only undermines the integrity of sports but also poses a threat to consumers who may unknowingly be participating in rigged games.
Furthermore, there are concerns about the impact of online sports betting on vulnerable populations, such as minors and individuals with pre-existing gambling problems. The ease of access to online betting platforms makes it difficult to regulate and monitor who is participating in these activities, raising concerns about underage gambling and exacerbating existing gambling issues.
In addition to these social concerns, there are also economic implications to consider. Some experts argue that legalized online sports betting may not generate as much revenue for the state as proponents claim, and that the costs associated with regulating and monitoring the industry could outweigh any potential benefits.
Overall, the hearing in Minnesota highlighted the complex and multifaceted issues surrounding legalized online sports betting. While proponents argue that it can generate revenue and provide consumer protections, opponents raise valid concerns about the potential for increased problem gambling, fraud, and harm to vulnerable populations. As states continue to debate whether to legalize online sports betting, it is important to carefully consider these risks and weigh them against any potential benefits.
