Congress Widens Probe into Online Gambling VIP Programs

Congress is doubling down on its inquiries into how online gambling sites cater to VIP gamblers. Online betting giants, including DraftKings, may have to disclose how they treat high rollers and whether they use AI to tailor perks.

The Philadelphia Inquirer reports that Congress has sent letters to several major online gambling operators and prediction markets. The list contains BetMGM, DraftKings, Kalshi and Polymarket.

A group of senators is behind the drive, including Connecticut’s Richard Blumenthal, New York’s Paul Tonko, and North Carolina’s Valerie Foushee.

The online gambling operators have until Nov. 5 to disclose the total revenue they receive from VIP players. The representatives also want to know what additional benefits and services VIPs get.

VIP Programs Targeting ‘Susceptible Customers’

Every operator on Congress’s target list has some sort of VIP scheme. Online sportsbooks like BetMGM have long-established loyalty schemes with tiered benefits.

Prediction markets including Kalshi and Polymarket reward traders based on trade volume and liquidity.

In letters posted this week, the lawmakers say the platforms are targeting susceptible gamblers, adding that it was “wholly unacceptable that the gambling industry profits at the expense of its most vulnerable customers’ financial and mental well-being.”

Letter Recipients (‘Rewards’ Program)

• BetMGM (BetMGM Rewards)
• Caesars (Caesars Rewards)
• DraftKings (DraftKings Rewards)
• Fanatics (Fanatics Rewards)
• Kalshi (Kalshi Platinum)
• Polymarket (various)

Prediction Markets Start to Close VIP Schemes

Despite being named, Kalshi decided to shut down its Volume Incentive Program last month.

The reward program let traders earn cash based on their total trading volume. However, Kalshi was accused of so-called “wash trading”, whereby traders repeatedly buy and sell contracts to artificially inflate their volume.

The CFTC said last month it was investigating suspicious trading volume in its perpetual futures.

AI Query Key to Probe

Artificial intelligence is likely to dominate any congressional probe into sportsbooks’ activity with VIPs.

AI can drastically enhance a sportsbook’s relationship with a high-activity gambler. It can update a VIP’s usage stats and win-loss ratio, automatically trigger tier promotions, and analyze user behavior. However, sportsbooks risk being accused of exploiting problem gamblers while improving the experience for their VIPs.

Tonko and Blumenthal introduced the Supporting Affordability and Fairness with Every Bet (SAFE Bet Act) in 2024. At the time, the pair were also addressing the use of artificial intelligence at sportsbooks.

The pair reintroduced the bill in March 2025, aiming at establishing federal minimum standards for legal sports betting. However, the bill remains mired in Congress due to considerable pushback over perceived federal overreach.

The two Congressmen have also introduced new legislation to regulate prediction markets.

DraftKings Still to Answer Questions in Louisiana

DraftKings is also under pressure in Louisiana, where it is fighting to extend its sports betting license.

The Louisiana Gaming Control Board (LGCB) has voted to extend the sportsbook’s online license until February next year.

However, the extension comes with conditions, namely DraftKings’ alleged use of AI to tailor rewards to customer needs.

DraftKings vehemently denies using AI in this way, but it faces similar probes in states including Massachusetts. Additional scrutiny from Congress won’t make the issues go away any time soon.