Key Moments:
- The Federal Trade Commission initiated a probe into online sports betting platforms, including DraftKings and FanDuel, for potential deceptive marketing.
- In 2025, legal online sportsbooks processed nearly $167 billion in wagers and recorded almost $17 billion in gross revenue.
- The City of Baltimore sued major operators in April 2025, alleging unfair targeting and exploitation of vulnerable consumers.
FTC Inspects Sportsbook Advertising Amid Rapid Market Growth
The Federal Trade Commission is examining marketing practices across the online sports betting sector. Specifically, regulators are reviewing whether major operators like DraftKings and FanDuel used misleading advertisements to attract users. According to the Washington Sun, political appointees and career FTC officials are actively conducting the early-stage inquiry.
Expansion of Legal Online Sports Wagering
Following the Supreme Court’s 2018 PASPA ruling, legal online sports betting quickly expanded across 32 states and Washington, DC. Consequently, industry wagering volume rose sharply over recent years. For instance, legal sportsbooks processed nearly $167 billion in total wagers during 2025 alone. Major markets like New York, New Jersey, Illinois, Nevada, and Pennsylvania continue to drive most of this activity.
| Year | Total Bets | Gross Revenue |
|---|---|---|
| 2025 | $167 billion | Nearly $17 billion |
Rising Concerns Over Problem Gambling and Legal Challenges
Critics frequently argue that sportsbooks exploit problem gamblers through bonus bets, boosted odds, and VIP rewards. Meanwhile, operators often limit or ban consistently profitable sportsbooks accounts. Indeed, DraftKings co-founder Matt Kalish publicly acknowledged that limiting successful bettors helps preserve sportsbook profitability.
In April 2025, Baltimore officials filed a lawsuit against DraftKings and FanDuel over local consumer protection violations. Specifically, the city claimed these operators systematically exploited vulnerable young men. City attorneys wrote in the complaint, “DraftKings and FanDuel put corporate greed ahead of the well-being of Baltimoreans, getting users hooked to their gambling platforms and then leveraging troves of data to identify, target, and exploit the most vulnerable among them.”
Furthermore, city officials emphasized that these deceptive strategies caused widespread financial and social harm across local communities.
The FTC’s Broader Gaming Industry Oversight
The Federal Trade Commission enforces fair competition and protects consumers from unfair market practices. Therefore, the agency regularly monitors false advertising, deceptive pricing, and antitrust violations across diverse industries, including commercial gaming.
For example, the FTC is currently reviewing Tilman Fertitta’s proposed $17.6 billion takeover of Caesars Entertainment for potential antitrust risks in Las Vegas and Atlantic City. Additionally, regulators mandated in December 2024 that casino-hotels display mandatory resort fees upfront in initial room pricing.
- Author
Daniel Williams
