Operators must get in line by next season
The NBA is cracking down on marketing language by sports betting companies in order to protect fans. In a new decree, the league is prohibiting the use of “risk free” in advertisements, as it is not only misleading to potential sportsbook customers, but an outright lie.
The ban, which will be enforced at the start of next season, pertains to operators who advertise on league and team-controlled platforms, such as television and the internet. Broadcasters (like ESPN) operators who advertise elsewhere are being encouraged to follow suit, though they will not be required to get rid of the controversial phrase.
Some operators have already done so and both Ohio and Massachusetts, the two newest states to launch sports betting industries, have banned “risk free.”
Such “risk free” language has been commonplace in the rapidly-growing United States sports betting market. It is blatantly dishonest and predatory and it is a wonder that it has not been clamped down on sooner (though not really – it is the gambling industry, after all).
If you can lose, it’s not risk free.
Though each operator is different, the way a “risk free” bet typically works is customers are refunded the amount of their first bet on the site – up to a certain maximum – if that bet loses. There is usually one Moby Dick-sized catch, though: the refund is not in cash, but rather in free bets or bet credits.
See the problem? It’s not risk free. Sure, you are refunded the dollar equivalent in bet credits, so you could end up winning on subsequent bets using said credits, but you could lose, too. Thus, it is absolutely not risk free. If I bet $100, lose, get $100 in credits back as part of the promo, then bet $100 with those and lose, I am out $100. Sure seems like a risk to me.
“We believe it’s a problematic term from a responsible gaming and a problem gaming standpoint,” NBA senior vice president Scott Kaufman-Ross, who is in charge of gaming and new business ventures, told Sports Business Journal. “It’s important that we be clear with our fans that sports betting carries inherent risk. The notion that anything in this area is risk-free runs counter to the key messaging and education around sports betting. We just feel it’s the right move for us.”
To avoid running afoul of this policy or similar ones issued by regulators, sports betting companies are not getting rid of the promotions, but rather changing the “risk free” language. PointsBet, for instance, has changed “risk free” to “second chance.” BetMGM calls the refund “bonus bets,” though it does have the phrase “PAID BACK” in a larger font on its promo banner than it does “IN BONUS BETS.” FanDuel calls it a “no sweat” bet.