McDonald, Shimsky, Tapia, Clark, DeStefano, Brown K, Bendett, Glick, Steck
MLTSPNSR
Add §1367-b, amd §§1367-a & 1367, RWB L
Enhances know your customer requirements and responsible gaming procedures; relates to the opening and closing of an authorized sports bettor's account; prohibits an authorized sports bettor from allowing another person to access such bettor's account; allows a bettor who does so to be designated a prohibited bettor; provides for the disposition of revenues from violation fines.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9584A
SPONSOR: Woerner TITLE OF BILL:
An act to amend the racing, pari-mutuel wagering and breeding law, in
relation to enhancing know your customer requirements and responsible
gaming procedures
PURPOSE: OF THE BILL:
The purpose of this bill is to strengthen consumer protections in mobile
sports wagering by enhancing identity verification and account security
safeguards to prevent unauthorized access, fraud, and underage gambling
and by establishing comprehensive responsible gaming procedure require-
ments to identify, assess, and address problem gambling and gambling-re-
lated harm.
SUMMARY OF PROVISIONS:
Section 1: Adds a new section 1367-b to the racing, pari-mutuel wagering
and breeding law enhancing identify verification and monitoring and
establishing comprehensive responsible gaming procedure requirements.
Subdivision 1 is definitions for the purposes of this section, section
1367, and section 1367-a of this title.
Subdivision 2: Account creation
-Requires enhanced identity verification prior to account activation,
including submission of identifying information, government-issued iden-
tification, and a live photograph to confirm the bettor's identity;
-Prohibits auto-population or pre-filling of required identifying infor-
mation;
-Requires identity verification and affirmative attestations before
sports wagers can be placed;
-Requires MSW licensees to allow account closure at any time and return
funds without unnecessary delays or barriers; and
-Allows voluntary collection of demographic and income information sole-
ly for research and regulatory oversight purposes.
Subdivision 3: Identity Verification
-Requires MSW licensees to establish written identity-verification
procedures and incorporate them into internal controls;
-Requires verification of identifying information through independent
and reliable data sources;
-Requires enhanced verification procedures where identifying information
presents elevated fraud or unlawful activity risk;
-Prohibits account activation or wagering where the MSW licensee cannot
reasonably verify the bettor's identity
Subdivision 4: Ongoing Monitoring and Authentication
-Requires multi-factor authentication for account access; Limits contin-
ued access without re-authentication to one hour on the same verified
device;
-Requires re-verification of identifying information when modified;
Requires written monitoring procedures to detect suspicious activity,
including fraud, account compromise, account sharing, proxy betting, and
wagers placed by prohibited sports bettors;
-Requires prompt suspension and internal review when monitoring identi-
fies material risk of unlawful activity; and
-Authorizes designation of individuals who knowingly engage in fraud,
account sharing, proxy betting, or other unlawful activity as prohibited
sports bettors.
Subdivision 5: Responsible Gaming
-Requires MSW licensees to establish and maintain written responsible
gaming procedures designed to identify, assess, and address gambling-re-
lated harm as part of internal controls;
-Requires designation of a senior responsible gaming lead with suffi-
cient authority and resources to oversee compliance, risk assessments,
documentation, and reporting;
-Requires periodic written reports to senior management, including
trends in at-risk, elevated-risk, and high-risk designations, inter-
ventions undertaken, and recommended improvements;
-Requires employee training on risk factors, risk assessments, and
responsible gaming obligations; and
-Requires periodic internal review of responsible gaming procedures and
risk assessment effectiveness with documentation available to the Gaming
Commission.
Subdivision 6: Risk Factors
-Requires ongoing monitoring and documentation to identify risk factors
associated with authorized sports bettors;
-Identifies key behavioral and financial risk indicators, including
escalating wager size or losses, increased deposit activity, high-fre-
quency or late-night wagering, frequent limit changes or withdrawal
reversals, failed payment transactions, and repeated interaction with
responsible gaming tools;
-Authorizes the Gaming Commission to establish additional risk factors
by regulation; and
-Requires the Gaming Commission to promulgate regulations governing the
identification, weighting, and evaluation of risk factors.
Subdivision 7: Risk Assessments and Designations
-Requires documented risk assessments when objective, evidence-based
thresholds are met, and risk factors reasonably indicate significant
risk of gambling-related harm;
-Requires risk assessments to evaluate the nature, frequency, and sever-
ity of risk factors, and to document and retain findings;
-Requires designation of an authorized sports bettor as an at-risk
sports bettor when significant risk is identified;
-Requires the Commission to establish additional criteria and thresholds
for elevated-risk and high-risk designations; and
-Requires ongoing monitoring and subsequent risk assessments where
warranted, and authorizes maintenance, escalation, or reduction of a
bettor's risk designation based on updated findings.
Subdivision 8: Documentation and Reporting
-Requires MSW licensees to document suspicious activity, identity
verification actions, re-verification efforts, risk factors, risk
assessments, risk designations, and responsible gaming interventions;
-Requires the responsible gaming lead to maintain and update a list of
at-risk sports bettors, subject to Gaming Commission review, and to
document reasons when a risk assessment does not result in an "at-risk"
designation;
-Requires retention of records for at least five years;
-Authorizes the Commission to require anonymized or aggregated reporting
to evaluate compliance, assess responsible gaming effectiveness, and
inform public policy;
-Protects personally identifiable information from disclosure, except as
required by law;
-Authorizes Gaming Commission audits and regulatory standards for
documentation, record retention, testing, and auditing; and
Subdivision 9: Data Privacy
-Prohibits the sale or sharing of consumer data collected under this
section, except where strictly necessary to provide services, comply
with law, or as required by Commission regulation;
-Requires MSW licensees to provide authorized sports bettors, upon veri-
fiable request, with a copy of their collected consumer data without
undue delay;
-Requires deletion of consumer data upon account closure and request,
within thirty days, subject to limited exceptions for federal law, judi-
cial orders, or ongoing investigations;
-Provides that deletion requirements supersede record retention
provisions in this section, except where retention is otherwise legally
required;
-Requires MSW licensees to implement reasonable administrative, techni-
cal, and physical safeguards to protect consumer data.
Subdivision 10: Regulation and Enforcement
-Requires the Commission to promulgate regulations necessary to imple-
ment and enforce the section, including standards governing account
creation and closure, identity verification, authentication, responsible
gaming procedures, risk assessments, documentation, and data security;
-Authorizes the Commission to conduct examinations, investigations, and
audits, require records and reports, issue findings of deficiency,
mandate corrective action plans, and order suspension or modification of
noncompliant practices;
-Authorizes civil penalties, license conditions, suspension, revocation,
or other disciplinary action for violations and authorizes the Gaming
Commission to consider severity, intent, duration, harm, compliance
history, and corrective efforts when determining penalties; and
-Clarifies that the section does not limit other Commission authority
and does not create a private right of action
Section 2: Amends subparagraph (xv) of paragraph (a) of subdivision 4 of
section 1367-a of the racing, pari-mutuel wagering and breeding law to
include responsible gaming procedure requirements established in new
section 1367-b as part of a MSW licensee's problem gaming plan.
Sections 3 and 4: Amends sections 1367 and 1367-a of the racing, pari-
mutuel wagering and breeding law to make definitions consistent among
these sections and new section 1367-b.
Section 5: Establishes that funding from penalties associated with prob-
lem gaming plan and responsible gaming procedure requirements shall be
directed in equal parts to education, problem gambling treatment, and
the Gaming Commission for enforcement purposes.
Section 6: Effective date.
JUSTIFICATION:
Mobile sports wagering has expanded rapidly, offering convenience and
accessibility to millions of adults. However, that same accessibility
creates risks when existing safeguards are intentionally bypassed.
According to the NCAA's 2023 Sports Wagering Survey, 58% of 18- to
22-year-olds have engaged in at least one sports betting activity.
Account sharing and proxy betting are amongst the most common ways
minors gain access to gambling platforms, despite statutory age
restrictions. This exposes minors to harms including early exposure to
gambling behaviors, which research shows increases the risk of future
gambling addiction and gambling-related harm.
Problem gambling has increased in prevalence in recent years, coinciding
with the rapid expansion and 24/7 accessibility of mobile sports wager-
ing platforms. The ease of account creation, instant deposits, high-fre-
quency wagering, and targeted digital marketing have lowered barriers to
participation while increasing exposure to gambling-related harm,
particularly among young adults and vulnerable populations.
This bill responds by strengthening identity verification and account
integrity safeguards, requiring ongoing monitoring of behavioral risk
factors, mandating evidence-based risk assessments, and establishing
structured responsible gaming procedures overseen by senior compliance
officials and the Gaming Commission. By combining enhanced know-your-
customer protections with data-driven risk detection, the bill seeks to
reduce gambling-related harm while preserving lawful access to mobile
sports wagering.
PRIOR LEGISLATIVE HISTORY:
New bill
FISCAL IMPLICATIONS:
None.
EFFECTIVE DATE:
This act shall take effect on the one hundred eightieth day after it
shall have become a law.
