The largest American bookmakers are joining forces to solve the gambling problem

Seven of the nation’s largest gaming corporations are joining forces to form an industry group promoting responsible gaming and can share details about problem gamblers for the first time in history.

Seven Operators – FanDuel, DraftKings, BetMGM, Penn’s Entertainment, Fanatics Betting & Gaming, Hard Rock Digital and bet365 will form the Responsible Online Gaming Association, or ROGA, the group announced on Wednesday.

Members represent over 85% of the legal online betting market in the United States. Collectively, they’ve pledged greater than $20 million to fund ROGA.

“I’m incredibly excited to take this forward and do truly impactful things, advance knowledge through research and create evidence-based best practices, and ensure players have access to information,” said Jennifer Shatley, executive director of ROGA.

ROGA members commit to working together on a wide range of issues, from education, responsible gaming best practices, and diligent promoting and marketing across the industry.

The recent group may even create an independent clearinghouse, or database, that can enable them to exchange key information related to consumer protection, although details of how it can operate are not yet clear.

ROGA says it can create a certification program that can evaluate members’ responsible gaming efforts and supply incentives for operators to participate.

The recent consortium was formed amid a surge in sports betting, each online and in shops, across the country since 2018. Thirty-eight states and Washington, D.C. now offer legal sports betting.

This 12 months, a record variety of Americans bet on the Super Bowl. According to the geolocation platform, the variety of online transactions was almost 15,000 per second, doubling last 12 months’s peak GeoComply.

But as gambling has turn out to be more mainstream – and bookmaker promoting spans television, streaming and social channels – the headlines have also included betting scandals and sports.

In recent days, Los Angeles Dodgers superstar Shohei Ohtani has found himself at the center of a $4 million betting scandal involving his translator and an illegal bookmaker. Ohtani insists he never bet on sports. The NBA is investigating Toronto Raptors player Jontay Porter for betting irregularities. And US Integrity, a technology company that combats illegal betting on college sports, reported irregularities in betting lines for men’s basketball games at Temple University.

The results of these claims: The potential to spark outrage and public criticism, potentially becoming a turning point for the US gaming industry. The rapid growth of gambling may also undermine the integrity of sports and lead bettors to addiction.

An estimated 2 million American adults meet the criteria for a serious gambling problem National Council for Problem Gambling. Another 5-8 million American adults are thought to have mild or moderate gambling problems.

Problem gambling has sparked regulation in Europe, and particularly in the UK, over the past few years, impacting the profitability of bookmakers and changing the way they do business.

In the United States, there was a concerted effort to be sure that the gambling industry polices itself and avoids a more stringent regulatory framework.

U.S. Republican Paul Tonko of New York is introducing national laws to address what he calls a “public health crisis.” “Tonko”Supporting affordability and fairness in every betting act” that he introduced last week would regulate gambling promoting, limit the number and size of deposits and restrict how artificial intelligence could be used to attract customers.

“You’re going to have a lot more people saturated with this opportunity, all these clever concepts of bonus bets, free bets and celebrity endorsements,” Tonko told CNBC.

In his opinion, the influx of gamblers will cause a dramatic increase in the number of individuals scuffling with addictions.

Some states have imposed fines on operators for gaming violations. In August, Maryland fined DraftKings $94,000 for marketing purposes aimed toward underage players. PrizePicks reached a $15 million settlement in New York for its illegal activities. In Indiana, the gaming commission fined FanDuel after eight people used illegally obtained debit cards to fund their sports betting accounts, causing “great harm” to partners with joint bank accounts, according to Indiana State Gaming Commission Chairman Milton Thompson.

Some gambling pundits are skeptical of ROGA, suspicious of what they see as a marketing ploy to solve a public relations problem.

Caesarwho’s conspicuously absent from ROGA’s founding group, told CNBC that he has developed best practices over 35 years of responsible gaming.

“While we appreciate all efforts to ensure responsible operation and marketing of online games, we are confident that our [own] A responsible approach to the game,” the company said in a statement.

Caesars said it only targets people 21 and older and does not allow anyone younger to sign up for a Caesars Rewards account, even in states like Rhode Island and Kentucky where 18-year-olds can bet.

Many fantasy sports and social betting platforms that operate on a lottery model allow players 18 years of age and older, and many of Caesars’ competitors allow players 18 years of age and older to play fantasy sports. Some also allow sports betting in this age group in the few states that allow it.

However, the industry is working to better insulate its youngest and most vulnerable customers.

The American Gaming Association entered into an agreement last March to ensure protection of school-age students against sports betting marketing and advertising.

Peter Jackson, CEO of Flutter, FanDuel’s parent company, said responsible gaming comes down to good business. But he warns that as legal operators come together to improve responsible gambling, the illicit market will always be willing to accept bets from problem gamblers.

“I am calling on state regulators to help us combat some of these black market operators,” Jackson told CNBC.