Blog

Shifting the RG Focus to the Unregulated Market

Shifting the RG Focus to the Unregulated Market

Eric Weiss

Managing Director, IC360 Advisory, North America

Sep 17, 2024

As we observe Responsible Gaming Month, it is an opportune time to recognize the notable achievements of the online casino and sports betting industry in promoting responsible gaming practices. Since the inception of online casino gaming in 2013 and the advent of online sports betting in 2018, the regulated sector has shown a strong commitment to safeguarding at-risk individuals by providing access to essential resources and support. Key initiatives include:


  • Equipping players with ongoing education and self-regulation tools.

  • Utilizing advanced technology to enhance risk detection and intervention methods.

  • Establishing comprehensive employee training programs centered on a culture of compliance.

  • Funding independent research to identify effective responsible gaming strategies.

  • Supporting mental health and intervention services.

  • Hiring and embedding Responsible Gaming experts in their operations.

  • A record of financial support for research to identify best practices for responsible gambling, followed by a commitment to implement these best practices.


These efforts have largely been driven by the proactive stance of state legislators and regulators, who identified the need for effective and increased responsible gaming measures. As someone who served as a New Jersey regulator in 2013 and was part of the team that developed these regulations, I can attest to the industry's dedication to fully fund and implement these vital initiatives.


However, as new legislation is considered — targeting areas such as advertising restrictions and financial assessments for bettors — it is crucial to pause and consider the broader landscape of gambling products that coexist with regulated online gaming.


Illegal and unregulated online sportsbooks and online casinos operate in virtually every state in the nation. Additionally, unregulated products such as online skill games, retail skill machines, and sweepstakes casinos are widespread and arguably pose greater risks to individuals vulnerable to problem gambling. Despite their prevalence, these products escape the rigorous scrutiny and regulation applied to the legal and regulated online gaming and sports betting industry.


Similarly, legal and regulated gambling activities, such as retail and online state-operated lotteries, retail and online horse racing, online fantasy sports wagering, and other authorized games of chance, are integral parts of the country’s gambling ecosystem with little or no requirements to address responsible gaming.


It is important to note that not all operators are oblivious to the need for responsible gaming controls. In fact, many recognize their importance and have worked with IC360 to take steps to be responsible citizens in this environment. However, others fall far short in their financial support for responsible gaming services and lack the robust responsible gaming tools and staffing mandated for online casinos and sportsbook operators.


During Responsible Gaming Month, legislators and regulators should reflect on their success in the regulated market and consider the impact of imposing additional, unproven, or untested regulations on an already highly regulated industry. Such actions may drive consumers toward unregulated, illegal markets, where there are no protections or responsible gaming requirements in place. This shift could undermine the progress made to safeguard players and increase the risks for those vulnerable to problem gambling.


Instead, a more balanced and comprehensive approach is needed—one that considers the entire spectrum of gambling activities—to ensure all participants, regardless of where they choose to play, have access to the necessary safeguards and support to wager responsibly. By doing so, we can better protect consumers engaged in all forms of legal and authorized gambling without inadvertently pushing them toward more dangerous, unregulated alternatives.


In conclusion, while the regulated online gaming and sports betting industry has made considerable progress in fostering responsible gaming, it is essential to expand the conversation. The focus should not be on imposing additional regulations on a well-regulated sector but on implementing best practices for the unregulated and under-regulated markets that compete with the regulated gaming industry.