Sportsbooks Face New York Scrutiny Over AI and At-Risk Bettors

New York’s Gaming Commission has moved forward with proposals to regulate how mobile sportsbooks utilize artificial intelligence (AI) and identify bettors at risk of problem gambling. These measures are yet to be finalized rules. The proposals target the use of AI by sportsbooks, affiliates, and vendors to tailor promotions, odds, betting limits, messages, and product recommendations based on customer data.

The restrictions would also prevent operators from suggesting specific wagers or betting amounts. The proposals do not apply to parimutuel horse racing. The commission also proposed requiring operators to identify at-risk bettors and assign a person to engage with them about their gambling behavior. With nine licensed mobile operators in New York, the state taxes mobile sports-betting gross gaming revenue at 51%.

Commission Chairman Brian O’Dwyer warned that customers restricted by one sportsbook could switch to another operator, urging companies to collaborate and share data to prevent such avoidance. Commission Chairman Brian O’Dwyer emphasized the need for the industry to address the issue, stating that if the industry fails to do so, the Commission will take action.

The AI proposal draws inspiration from a similar regulation in New Jersey but does not outright ban the technology. Governor Kathy Hochul included the measures in her 2026 State of the State program, addressing underage gambling, marketing to at-risk customers, and gambling addiction. The New York action is part of a broader debate over sportsbook marketing practices and regulatory responses to gambling-related risks.