In 2018, the United States Supreme Court opened the floodgates for states to legalize betting on sports. Eager for revenue, almost forty states have done so. The result is the explosive growth of an industry dominated by companies like FanDuel and DraftKings.
One out of every five American adults gambled on sports in 2023, amounting to $121 billion, more than they spent on movies and video games combined.
The rise of online sports gambling – the immediacy of betting with your phone, the ability of the companies to target users, the dynamic pricing and offers based on how good or bad of a gambler you are – has produced a public health crisis marked by addiction and far too many people, particularly young men, gambling more than they can afford to lose.
Under intense lobbying from the gaming industry, states have created a system built around profit for sportsbooks, not the well-being of players.
In his new book Losing Big: America’s Reckless Bet on Sports Gambling (Columbia Global Reports, 2025), historian Jonathan D. Cohen lays out the emergence of online sports gambling, from sportsbook executives drafting legislation to an addicted gambler confessing their $300,000 losses.
“Sports gambling was legalized in a way that is reckless,” Cohen told Corporate Crime Reporter in an interview last week. “Sports gambling can be fun and cool and it should be legal. But the particular way it was unfurled in the United States was reckless. In many states it was rolled out quickly. It was rolled out online right away without sufficient consideration for the consequences, particularly for the gamblers and particularly for young male gamblers who are disproportionately affected by the rise of sports gambling – with financial harm and gambling addiction.”
One of the activist groups in this area – Stop Predatory Gambling – calls for the criminalization of gambling. They don’t think it should be legalized. We have interviewed the leaders of that group over the years. You don’t agree.
“I have done work with them. I’m doing a webinar for them. Generally speaking, having an advocacy network like theirs is very important. And it’s an important aspect of the effort to reduce gambling harm.”
“Personally, I’m not anti-gambling writ large. And when it comes to sports betting, I think sports betting should be legal. I have issues with the way it was legalized and the way it was unfurled. My understanding is that members of the Stop Predatory Gambling network believe it should not be legal, either on moral or religious grounds.”
“So no, I don’t agree with everything they stand for. But they are paddling the boat in the right direction and I’m honored to be able to work with them.”
If only a small percentage – one percent – of Americans have a problem with gambling, why is it a public health crisis?
“This is not just an individual level issue. If a river is running through the city and people keep falling into the river, it’s not because you have a bunch of dumb people who keep falling into the river. It’s because the infrastructure around the river is designed in such a way that it’s too easy for people to fall in. You can call that a public health issue.”
“Same for gambling. There are enough stories of people having similar problems that it’s not sufficient to say that these people should have had better self control, these people should have known better. And every gambler I spoke with said the same thing – I should have known better, I bear responsibility for my actions. But it is happening to so many people that it’s clear that the solution cannot be on a person by person basis. We need a public health approach, we need to put guardrails around that river to keep them from falling in. Same for gambling – we need guardrails to prevent people from developing problems in the first place.”
Congress prohibited tobacco advertising on television. And Congressman Paul Tonko (D-New York) introduced legislation prohibiting sports betting advertising on television.
“He has since added additional measures to his bill that go beyond prohibiting advertising. I spoke with Congressman Tonko for my book. He had the same sense I did. Around 2021 and 2022, we saw these ads everywhere. And we asked – are we sure this is a good idea?”
“I do think there is some merit to restricting advertising. Research from the American Gaming Association shows that the advertising volume has been in decline for the past two years. Yes, we could do more about advertising. Many other countries have what’s called whistle to whistle ban and you are not allowed to advertise during sporting events.”
“But advertising would not be the first thing that I would try to solve. In many respects, the genie is out of the bottle.”
You write that in seven short years, after a Supreme Court decision, sports gambling was legalized in 38 states. You say it took 30 plus years for 38 states to adopt a lottery. What about the states that don’t allow sports gambling? How did that happen?
“The industry and legislators are still working on those states. There is this phenomenon that once the surrounding states legalize a product – it’s true for marijuana and lotteries and other products – the logic is – well our citizens are traveling next door to gamble or get marijuana and those states are making cash revenue.”
“Utah has no form of gambling and they are never going to legalize it. I would have said the same for Hawaii until about two weeks ago, but now Hawaii appears to be on the verge of passing legal sports betting because of local economic conditions.”
There are no surrounding states in Hawaii.
“Correct. But legislators always see it as free money. There are all kinds of costs to gambling. But they see the revenue from gambling as free money. It’s revenue that does not require compulsory taxes.” But there are social and human costs that come with online sports betting – suicide, divorce, alcoholism, drug abuse, bankruptcy.
“People fall into addiction and then this at-risk or problematic category. The headline is – the way it’s set up now, gambling allows people to lose as much money as they want to lose. Oftentimes, people end up losing more money than they intend and more money than they can afford. Studies show that the legalization of online sports betting in a state is associated with a 25 percent to 30 percent increase in bankruptcies, increase in credit card delinquencies, an increase in auto loan delinquencies, reduced savings and investments in the stock market, and so on.”
“Many of those people are not gambling addicts. They are people who have episodic addiction or just go through a period of gambling harm where they lose more money than they can afford or more money than they intend, and then they get their head back and ask – how did I just lose $15,000 over the course of two weeks?”
“That’s the low level of harm. The higher levels of harm, where gambling addiction is the behavioral addiction with the closest association with suicide because people feel shame at their addiction. They feel that if they disappear though suicide, their debts would disappear with them.”
What’s the reform?
“I would love it if the reform came from the companies and did not require legislative action. The first is – setting up some of these guardrails.”
“You can only make deposits into your account during certain time periods. Whenever you do deposit money into your account, you have to wait 12 to 24 hours before you can bet with it. You reduce the options on things you can bet on. I don’t think anyone in America should be able to bet on Malaysian women double badminton. That’s just a trap for people with problem gambling who are chasing action wherever they can find it.”
“The other side of the reform is reducing the incentives for the companies to exploit losing bettors. That might involve information sharing between the companies. That is being discussed. FanDuel doesn’t want to cut you off, because if FanDuel cuts you off, you are just going to go over to DraftKings. If DraftKings cuts you off, you are just going to bet with BetMGM.”
“If there was some form of information sharing, they could cut you off writ large from legal operators. Things like that would allow companies to take advantage of all of the data they have and create a framework where they are not as incentivized to exploit users and extract every last dollar from them, which is what they are doing right now.”
[For the complete q/a format Interview with Jonathan Cohen, see 39 Corporate Crime Reporter 17, April 28, 2025, print edition only.]