Online online sports betting platforms are facing intense scrutiny over controversial practices that reward heavy-losing customers with VIP perks and increased betting opportunities while sharply cutting limits for consistent winners, a practice known as ‘limiting.’
The Impact of Limiting on Winning Bettors
According to CBS News, some betting platforms reduce the maximum single-bet limit for profitable customers to under $20, and in extreme cases, below 50 cents. Meanwhile, a Massachusetts Gaming Commission investigation confirmed that limits for losing customers tend to increase, although restricted accounts accounted for about 0.64% of the total.
Professional bettor Mike Manning stated that after steadily earning profits across multiple apps since sports betting launched in Massachusetts in 2023, his maximum bets were slashed to $25 on DraftKings and $5 on BetMGM, down from past limits of $1,000 to $5,000. Another user claimed that DraftKings set a maximum bet of just 49 cents during an NBA Cup game.
VIP Perks for Heavy Losses and Regulatory Response
Conversely, the practice of providing VIP programs and special benefits to customers suffering massive losses has also drawn criticism. Chris Sweat, a former South Carolina attorney, revealed that wagering over $25,000 a month on FanDuel earned him a dedicated VIP manager along with game tickets and complimentary entries. Over two years, he wagered roughly $11 million and lost about $1 million, ultimately pleading guilty to embezzling around $2 million from his law firm to fund his gambling.
Federal lawmakers recently sent letters to major betting platforms expressing concern that granting VIP status and perks to repeat losers could encourage vulnerable users to continue betting. Notably, Massachusetts became the first state to require sportsbooks to notify customers and provide reasons when their betting limits are restricted.
Industry Defense and Risk Management
Betting operators maintain that limiting is a legitimate risk-management tool. DraftKings stated that customer-specific bet restrictions affect fewer than 0.15% of all accounts and are designed to counter pricing errors or attempts to exploit market discrepancies rather than punishing winners. FanDuel similarly emphasized that it provides responsible gambling tools and has enhanced problem-gambling prevention programs.
