Five regulatory guidelines dismiss integrity fee claims

Gambling regulators in four states have questioned the need for sports to receive an integrity fee from the sports betting industry and put forward five guidelines for state legislators to consider when looking at regulating sports betting in their states.

Regulators from Nevada, Massachusetts, Louisiana and Michigan issued a joint statement last week with the intention of sharing the knowledge gained from two years of meetings under the auspices of the University of Nevada, Las Vegas’s International Center for Gaming Regulation (ICGR), to dialogue about current issues affecting the gambling industry and to further best regulatory practices.

The statement was also intended to assert that ‘states and tribal gaming regulatory agencies have the capacity, resources, and ability to oversee the regulation of legalized sports betting’.

They said: “As the regulators in different gambling jurisdictions, we have jointly concluded that the following simple guidelines will help with an initial approach to sports betting regulation. While we cannot personally commit our respective jurisdictions to any specific position or practice, we support all of these positions individually, will support them throughout our regulatory agencies, and will help provide guidance to other jurisdictions as to how these guidelines can be implemented.

  1. Coordinated action among jurisdictions offering sports betting against illegal bookmaking, illegal gambling activities, and any unsuitable and unlawful associations, along with strong support from federal-level enforcement agencies, is the best way to eradicate illegal activities.
  2. Another critical element of legalized sports betting is the establishment of structures and processes that will ensure a high level of integrity in all sports. Therefore, all of our
    jurisdictions and others that legalize and regulate sports wagering should aim to share real-time betting information, in an effort to detect, prevent, and eliminate match fixing.
  3. Measures for responsible gambling in sports betting are important to help protect and maintain the credibility of the activity.
  4. The history of legalized sports betting in both Nevada and the United Kingdom indicates that it is a very low-margin business compared to other forms of gambling. Reasonable tax rates and fees are essential for legal sports betting to be competitive until illegal providers can be eradicated.
  5. Additional fees, including the so-called “integrity fee,” increase the costs of legal sports betting, siphon much needed tax revenues away from state coffers, and increase state regulatory burdens.”

The four states have committed to immediately develop a Memorandum of Understanding between the jurisdictions to acknowledge support for implementation of these principles and have invited any other jurisdictions with interest to join them.

They added: “We encourage state legislatures that elect to legalize sports betting to consider these guidelines in order to promote a coherent regulatory environment.”

Given that Nevada has had many decades experience of regulating sports betting, the other jurisdictions have recognised that this enables the Nevada Gaming Control Board to be a leading voice on the future of sports betting regulation across the country.

They added: “As experienced gaming regulators who are part of the U.S. State Gaming Regulators Forum, we would encourage jurisdictions to establish and implement regulatory models that are not only adaptive and successful, but that remain flexible enough to be sturdy, yet encourage innovation.”