Massachusetts Probes DraftKings Over AI Use in Gambling Promotions

Key Highlights

One of the biggest sportsbooks in the U.S. is under fire for allegedly using AI to identify gamblers more likely to lose and target them with greater incentives to keep playing.

Massachusetts Reviews DraftKings’ Use of AI

Nearly a week after a New York Times story revealed DraftKings’ AI practices, the Massachusetts Gaming Commission (MGC) is examining how the sportsbook and other licensed operators use artificial intelligence. State gaming rules explicitly state that Massachusetts betting sites cannot draw on customer data to deliver individualized promotions via automated systems. MGC Chair Jordan Maynard said staff members were directed to speak with DraftKings and learn more about how betting companies across the state are using AI.

Maynard noted that AI technology is developing quickly, creating new questions for regulators. He said the commission has not determined that DraftKings broke any rules, and the review is intended to gather more information. Officials want a clearer understanding of how the company uses AI, especially when deciding which customers receive promotions and other marketing offers.

MGC Executive Director Dean Serpa and other staff members are expected to meet with DraftKings in the future. Their review will focus on the company’s use of AI and machine learning, including how its promotional systems work. Commissioner Paul Brodeur called the New York Times’ findings troubling but said regulators first need to establish the facts before deciding whether further action is necessary.

Report Raises Questions About Betting Promotions

The New York Times reported that DraftKings used machine learning to review customers’ betting histories. According to the report, the technology helped identify gamblers who were likely to continue betting and losing money after receiving promotional offers. The investigation relied on interviews with more than 40 former DraftKings employees, company documents, and customer betting records.

Several former employees reportedly expressed concerns the technology could harm people dealing with gambling addiction. DraftKings also stopped work on a separate system that could have identified customers whose betting behavior suggested they might need help, which is particularly noteworthy as gambling addiction searches increase each year. The company rejected claims that it uses AI in ways designed to make gambling more addictive.

DraftKings said it follows Massachusetts sports betting regulations. The company also said it doesn’t use AI to target customers because of their losses and doesn’t market to people based on signs of possible problem gambling. Those statements will be considered as state officials review how the sportsbook uses automated technology in its operations.

Massachusetts Could Consider Additional AI Rules

Massachusetts already limits how sportsbooks can use automated systems for promotions. Betting companies can’t use customer data through an automated system, including AI, if that system is known or reasonably expected to make gambling more addictive. Operators must also explain to regulators how they monitor customer behavior and encourage responsible gambling.

The MGC created an AI task force after a 2025 study identified gaps between developing technology, company practices, and existing gambling regulations. That group will help examine DraftKings’ practices and other uses of AI in the state’s betting market. Maynard said the findings could help officials decide whether additional guidance, regulations, or enforcement steps are needed going forward.