US Betting Bill to Require Fed Approval

US Betting Bill to Require Fed Approval

A draft of a new US federal sports betting bill has a two-fold purpose. First of all, it requires the US Attorney General to potentially place a veto on the legislation that takes place on the state level. Secondly…

…bookmakers must use the official data provided by the league for the betting purposes.

Earlier in the year, the US Supreme Court lifted a ban and allowed each state to decide whether or not they wanted to implement sports betting into their system. Ever since that happened, there hasn’t been any attempts to reinstate some level of federal control over sports betting.

Until now

David Purdum of ESPN was the first person to spot this draft and he reported that Senator Orrin Hatch was the one to propose the bill. Hatch, who plans to retire in the near future, has gained supported by Republican Chuck Schumer.

In the meantime, Republican, Jim Sensenbrennner, announced a “legislative response” to the federal betting disempowerment.

It is highly likely that Hatch will manage to push through this betting bill because he needs to act swiftly and the bill itself is quite controversial…

…considering the right of each state to make a decision, which was the reason the previous federal bill wasn’t empowered.

The Process

The idea is for each state to submit the legislation to the US Attorney General who would have six months to study it and see whether it meets the minimum requirements. The Attorney General would have the right to veto any legislation which wasn’t in accordance with the law.

However, the draft is not quite clear. It remains unknown…

…whether the states which have already introduced sports betting would have to go through the process retroactively. Currently, seven states have regulated sports betting and eight more are expected to join the bandwagon soon!

What Else?

While states would be dependent on the US Attorney General, the betting operators would also be restricted in a way. Namely, until December 31, 2022, they would have to use data supplied by the league for wagering purposes.

Only after this date would they be allowed to put the “legally-obtained” data in use, but that would be similar to the information provided by the league.

Furthermore, operators would be obliged to answer to a nonprofit “national sports wagering clearinghouse” in regards of suspicious betting patters and illegal gambling.

In addition, transaction reports were to be filed to the organization should this bill passes. Let’s not forget to mention that the clearinghouse would be in control of the national register of excluded bettors.

There’s more

Currently, the federal government takes a 0.25% cut in excise tax…

…but the new bill proposes for this money to be put into a “wagering trust fund” and be used for the clearinghouse operations and other programs which are related with sports betting.

This bill contradicts the 1961 Wire Act which permits the states to keep the wagering info to themselves. Generally speaking, tight federal scrutiny would be imposed with the new bill, restricting both the states and the operators.

The revenue gain predicted by 2030 in the United States from sports betting is $8 billion, which is only one third of the market potential. However, should this bill come to pass, sports betting legalization would slow down and the estimate would probably have to be lowered…

…as some of the states would not be permitted to regulate this form of gambling after they had submitted the legislation to the Attorney General.


“New US betting bill would require fed approval of state legislation”, Steven Stradbrooke,, December 5, 2018.

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