Online sports betting platforms are facing scrutiny from state regulators and federal lawmakers over the practice of "limiting" successful gamblers while offering rewards to those with significant losses. Data from the Massachusetts Gaming Commission indicated that approximately 0.64% of betting accounts in the state have been restricted, with a trend showing winning gamblers face decreased limits while losing bettors may see theirs increased. DraftKings and FanDuel stated these measures are standard industry risk-management tools used to protect their businesses from professional bettors or those exploiting odds discrepancies.
The tension between operators and bettors follows the 2018 legalization of online sports gambling, a market where $167 billion was wagered last year. While companies use advertising and celebrity endorsements to attract customers, professional bettors report being capped at wagers as low as 49 cents or $5 after showing consistent profits. Conversely, individuals with high losses have reported being granted "VIP status," which includes perks such as Super Bowl tickets and cash bonuses. One bettor, Chris Swett, reported wagering $11 million over two years and receiving incentives from a VIP host even after stating he was "tapped out."
In October 2026, a group of U.S. lawmakers wrote to major gambling platforms expressing concern that VIP programs exploit vulnerable bettors. The Massachusetts Gaming Commission became the first state regulator to require companies to notify limited gamblers and provide specific reasons for the restrictions. DraftKings told regulators it applies limits to less than 0.15% of accounts globally as an enterprise risk control, stating these decisions are based on customer behavior rather than win-loss records. BetMGM declined to comment on the matter.
The day-to-day experience for bettors changes based on their success rate. A winning bettor may suddenly find their maximum allowed wager reduced from thousands of dollars to less than $1, effectively preventing them from using the platform for income generation. For those struggling with addiction, the immediate access provided by smartphones and the "immediacy" of betting can lead to rapid financial loss. FanDuel stated it suspended 5,700 accounts for problem gambling last year, representing a small fraction of its 18 million users. Critics like Brianne Doura-Schawohl of the Campaign for Fairer Gambling argue that pervasive advertising suggests winning is achievable for all, while internal company mechanics prioritize ensuring the "house always wins."
The next steps involve further regulatory and legislative oversight. Massachusetts already requires companies to provide data on their limiting practices, setting a precedent that other states may follow as they weigh consumer protection against industry risk management. Federal lawmakers are currently awaiting responses from the platforms regarding the exploitation of vulnerable bettors through VIP incentives. Chris Swett, the former attorney who defrauded his firm of $2 million to fund his gambling, is currently awaiting sentencing in federal court, where he faces a maximum of 20 years in prison. The industry maintains that these platforms are intended for entertainment rather than professional income generation.