Player protection will be a central theme discussed during the SBC Summit North America 2022 conference as senior executives from many high-profile iGaming companies gather in New Jersey.
The event takes place July 12-14 at the Meadowlands Exposition Center and is the Leading Sports Betting and iGaming Event in North America.
When the summit convenes, Cooper Levenson will serve as the event’s Legal & Regulatory Partner. Three of the firm’s attorneys, CEO Lloyd D. Levenson, Co-Chair of the firm’s Gaming and iGaming Law Practice Group, Lynne Levin Kaufman, and gaming attorney Lucas R. Levenson will participate in active roles during the 3-day Summit.
The Leadership track features a panel discussion entitled “Leadership and player protection – a shift toward solutions” and will examine how operators can improve their approach to player protection.
Among the topics being discussed are the big differences in player protection requirements for license holders in the different states. Kaufman’s experience includes working with betting and gaming companies across the nation.
“There is a lot of uniformity when it comes to the big picture,” Kaufman said. “For example, most North American jurisdictions have responsible gaming requirements that mandate operators to build safeguards into their wagering system that a player can opt into, such as deposit limits, play limits, cooling-off periods, and time restrictions.”
Many jurisdictions require certain messages to appear after a pre-determined time or dollar spend, Kaufman said.
Additionally, all or almost all jurisdictions have a self-exclusion requirement, although the self-exclusion time periods vary, she continued.
“I see more differences in other forms of player protection such as credit issuance, advertising restrictions, and fraud prevention,” Kaufman said. “For example, with respect to fraud prevention, particularly the prevention of underage gaming, account takeover or proxy betting, as of June 30 New Jersey became, I believe, the only state to require two-factor authentication.”
Another area where Kaufman sees big differences state to state “is concerning the inclusion of funding for responsible gaming research and/or treatment programs”.
The panel will discuss how much of a role regulators play in guiding operators’ responsible gambling policies, whether there are any state regulators that do this particularly effectively, and what the wider industry can learn from them.
Lucas Levenson said regulators have been extremely diligent and helpful in all areas in guiding operator policies to not only be compliant with a respective state’s rule or law, but allowing the operator to be consumer-friendly regarding Responsible Gaming (RG) controls.
“Generally, all states require an RG policy that must be approved by the respective state’s board,” Lucas Levenson explained. “Others, in addition to policies, require proactive controls like customer training and reporting requirements to detect RG issues. “
New Jersey regulators will soon require operators to implement new RG standards, Kaufman said.
The standards, which are still being drafted, will not only focus on prevention, but also require an operator to use current technologies and research tools to review customer data, starting with the deposit and continuing through all transactions captured in the player management and wagering systems to detect and address risky behavior before it becomes a gambling problem, Kaufman explained.
The business case for taking RG seriously
While the player should be at the heart of every betting and gaming company’s approach to responsible gambling, executives must also think about the impact of their strategies on their own businesses.
There are risks for companies that do not develop effective approaches to safer gambling, Lucas Levenson said.
“The obvious risks are significant fines from state gaming commissions, loss of license(s), and/or lawsuits stemming from the affected persons,” Lucas Levenson said. “I think it would be a domino effect where one operator ignoring significant RG issues could lead to a major change in the industry.”
“Many operators have recognized that RG and other forms of player protection are essential not only to avoid regulatory penalties, but also to build customer confidence in an operator’s offering, which then helps build customer loyalty, which then builds growth,” she said.
With the online gambling industry moving towards being an established mainstream entertainment product, an increased focus on player protection from regulators, legislators, and lobbyists is anticipated.
There also are new challenges facing licensed operators and B2B suppliers who need to plan to get ahead of the curve and avoid some of the issues now being encountered in long-established European markets.
“We have seen a marketing trend away from the traditional sports betting towards the ‘get-rich’ type wagers,” Lucas Levenson said. “While these are generally low-risk for the consumer and high-yield for the operator, I believe selling the lottery-type pipe dream will lead towards more compulsive gambling in the long run.
“I think many of the operators have curtailed their marketing spend, meaning fewer television advertisements and so forth,” he added.
However, Kaufman sees signs that marketing spending continues in sports betting.
“I am not so sure the marketing spend has been curtailed as I am still seeing an awful lot of sports betting ads,” she said. “And running those types of ads with very small disclaimers increases the risk of unhappy customers filing consumer protection lawsuits for misleading advertising – and complaints with their regulatory body.”
The ideal model for dealing with problem gambling is based on prevention, and operators and their media/professional sports partners, regulators, and technology suppliers need to work together more closely to build that approach, Lucas Levenson said.
“Lynne mentioned New Jersey will soon be requiring that approach,” Lucas Levenson said. “Putting that aside, I think operators should take a more proactive approach without being too invasive to the customer.
“Generally, every online sportsbook can profile customers based off risk; why can’t that be translated to RG flagging? If the data on a customer shows a drastic increase in bet sizes or deposit frequencies, those should be flagged. The operator could then reach out to the customer to ensure they are within comfortable betting habits and provide RG help in case the customer needs it; I don’t see that as being invasive.”
SBC Summit North America 2022, the leading conference and tradeshow for the sports betting and igaming industries in the region, takes place at Meadowlands Exposition Center, New Jersey on July 12-14.
The ‘Leadership and player protection – a shift toward solutions’ conference session, sponsored by Cooper Levenson, takes place on July 13 at 2pm ET. The panelists include David Rebuck (Director, NJ Department of Gaming Enforcement), Joseph Addabbo Jr (State Senator, New York 15th State District), Martin Lycka (SVP American Regulatory Affairs and Responsible Gambling, Entain), Declan Raines (Head of US Gaming, TransUnion), Paul Buck (Founder & CEO, Epic Risk Management), and Bill Pascrell, III (BP3) (Partner, Princeton Public Affairs Group).
Tickets for the event, which include access to eight conference tracks, an exhibition showcasing the next generation of industry products, and entrance to a selection of evening networking parties, can be booked at the SBC Summit North America website.