WASHINGTON, D.C. – In a Senate Judiciary Committee hearing on legalized sports betting, U.S. Senator Peter Welch (D-Vt.) called out online sports gambling companies FanDuel and DraftKings for exploiting the addictive nature of gambling and undermining antitrust law.
The hearing comes after Senator Welch and Senator Mike Lee (R-Utah) wrote a bipartisan letter to Jonathan Kanter, Assistant Attorney General for Antitrust at the Department of Justice, and Lina Khan, Chair of the U.S. Federal Trade Commission (FTC), raising concerns about FanDuel and DraftKings’ conduct. The lawmakers urged the Justice Department and the FTC to ensure competition is protected.
“Senator Lee and I have sent a letter to the FTC inquiring about whether there are antitrust issues here. Obviously, in any market—not just this one—competition is important. And one question I have is whether the more we allow for competition, some companies may have better practices than others…,” Senator Welch asked Harry Levant, LP.D., MA PCC, ICGC-I, JD, Director of Gambling Policy and a Certified Gambling Counselor.
Mr. Levant responded: “I believe it goes to the need for minimum federal standards because some of these companies have become so large—and I specifically mentioned in my opening testimony—DraftKings, who has recently purchased an Artificial Intelligence company. So, what they have is the capacity not only to control markets but to use the technology to target vulnerable customers with the most addictive forms of what’s called ‘micro-betting.’”
Mr. Levant continued, “So, that while the Justice Department deals with issues such as competition, what from a public health perspective Congress can deal with is, which forms of these bets should actually be permitted, and which are simple too dangerous from a public health perspective.”
Senator Welch also questioned experts about sports betting creates emotional pressure and harassment for children, students, and young athletes.
Watch the Senator’s full remarks below:
In 2016, FanDuel and DraftKings, two of the largest sports betting companies in the United States, attempted to merge. The FTC, California, and D.C. blocked the transaction after finding it would have given the firm a 90% market share. After the failed merger, the companies expanded their dominance by becoming online sports betting giants. Together, and through their trade association the Sports Betting Alliance, FanDuel and DraftKings have undertaken a coordinated effort to pressure crucial business partners not to do business with new players in the market—creating consumer protection concerns and interfering with rivals’ relationships with major sports leagues, marketing partners, payment processors, and critical vendors.
Read Welch and Lee’s letter here.
Hearing witnesses included Charlie Baker, President the National Collegiate Athletic Association and former Governor of Massachusetts; Johnson Bademosi, Former NFL player and the National Football League Players Association (NFLPA); Harry Levant, LP.D., MA PCC, ICGC-I, JD, Director of Gambling Policy and Certified Gambling Counselor, Public Health Advocacy Institute at Northeastern University School of Law; David L. Rebuck, Former Assistant Attorney General, Former Director of the Division of Gaming Enforcement; Keith S. Whyte, Executive Director of the National Council on Problem Gambling.
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