(continued from prior post due to space limitations)
Sports governing bodies should not be subject to licensure merely because sports betting operators accept wagers on the events that our organizations oversee. Under the draft definition of sports betting supplier, any entity that “manages, administers, or controls the games on which wagers are initiated, received, or made . . .” qualifies for this level of licensure. As written, this definition is overbroad, and can be interpreted to include sports governing bodies; however, we do not believe it was the Board’s intention to require all entities that “administer . . . games” to obtain supplier licenses. We encourage the board to clarify that sports governing bodies do not—by virtue of their status as entities that present and oversee sporting events—qualify as suppliers by amending the relevant definition as follows:
“Sports betting supplier” or “Supplier” means a person who: (a) manages, administers, or controls wagers initiated, received or made on a sports betting platform; (b) manages, administers, or controls the games on which wagers are initiated, received, or made on a sports betting platform, excluding sports governing bodies as defined in this section; or (c) maintains or operates the software or hardware of a sports betting platform, including geolocation services, customer integration, and customer account management.
Virginia’s sports betting law requires permit holders to cooperate with sports governing bodies’ investigations, including the provision of account-level betting information, and audio and video files. See Virginia Lottery Law; Sports Betting Section 58.1-4043(E). As the Board is aware, this information will be important to the resolution of sports betting investigations. As written, however, the Board’s draft regulations only require regulated entities to provide account-level betting information and data files to the Executive Director and law enforcement agencies. To better reflect the language and intent of the statute, we urge the Board to amend this provision as follows:
C. A regulated entity shall provide or facilitate provision of account-level betting information and data files relating to individuals placing wagers and any other information necessary for investigations conducted by the Director, a sports governing body, or a law enforcement agency.
Virginia’s sports betting law mandates that permit holders share in real time, or as frequently as is commercially reasonable, certain betting information with sports governing bodies. See Virginia Lottery Law; Sports Betting, Section 58.1-4034(B). However, the Board’s draft regulations undercut this mandate and state that disclosure is only required if the Director determines, in his or her sole discretion, that such information sharing is “necessary.” We recommend that the Board amend this regulation to harmonize it with the type of data sharing that is contemplated in the statute.
Using technology to identify potential integrity issues based upon abnormal betting patterns is essential for all parts of the sports betting ecosystem, and sports governing bodies are best positioned to detect integrity issues across operators and across jurisdictions. Because sports betting in the United States is currently being legalized and regulated at the state level, there simply is no interstate system that collects and monitors betting data on a nationwide basis; states thus remain unable to detect abnormal betting activity that may occur across multiple jurisdictions. Sports governing bodies are uniquely positioned to fill this gap for their sports. They also have resources that no regulator or sports betting operator has in terms of investigative reach and authority, including access to teams, referees, players, and other insiders. For all of these reasons, we recommend the following amendment to the proposed regulations: