John Boozman , Chairman Amy Klobuchar, Ranking Member
Tim Scott, Chairman
Elizabeth Warren, Ranking Member Committee on Banking, Housing & Urban
Committee on Agriculture, Nutrition &Forestry
U.S. Senate
U.S. Senate
Washington, DC 20510 Washington, DC 20510 via email: fitzhugh_elder@ag.senate.gov email: chris_lucas@banking.senate.gov via email: lauren_santabar@ag.senate.gov email: jon_donenberg@banking.senate.gov RE: Stop the Proliferation of Unregulated Sports Betting and Gambling using Prediction Market Financial Platforms Dear Chairmen Boozman and Scott and Ranking Members Klobuchar and Warren: I write on behalf of the ________ to express urgent concern about prediction markets licensed by the Commodity Futures Trading Commission (“CFTC”) engaging in online sports gambling under the guise of “event contracts” pursuant to the Commodity Exchange Act (“CEA”). These financial platforms argue that they are registered through the CFTC and the Securities and Exchange Commission (“SEC”), making their activities outside the scope of state and tribal government laws and regulations. This argument ignores and clearly conflicts with what Congress intended when it last modernized the CEA. Your committees are in the process of reviewing and revising the authorities of the CFTC and SEC. We ask that you amend the CEA to reinforce existing law and regulations prohibiting these financial platforms / prediction markets from offering event contracts on sport events or casino-style gambling activities . Since the Supreme Court’s 2018 Murphy decision that struck down the federal prohibition against the state legalization of gambling on sports, sports betting in the United States has grown slowly on a tribe-by-tribe and state-by-state basis. Tribes and states have made sovereign decisions tailored to their jurisdictions. Some state and tribes continue to prohibit sports betting for religious, moral and ethical reasons. Others have legalized sports betting with tailored age restrictions – the great majority sets the age limit at 21 (while prediction markets are open to 18 year olds with weak age verification requirements), prohibitions against betting on local sports teams, prohibitions against betting on high school and college sports, prohibitions against player proposition bets, some tribes and states also require operators to offer mandatory deposit limits and session time limits, integrated with local problem gambling helplines and self-exclusion systems. This system lets voters and elected leaders decide whether to legalize sports betting. In state and tribal jurisdictions that have legalized sports betting, the activity is subject to local fees and taxes that are in turn used to offset adverse impacts and to fund priority programs, such as education, elder programs, health care and more.
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