New York Proposes Restrictions on AI-Powered Sports Betting Promotions.
The New York State Gaming Commission (NYSGC) has advanced proposed rules to limit how licensed mobile sportsbooks use artificial intelligence (AI) to personalise promotions, betting recommendations and customer engagement.
Commissioners unanimously approved a revised proposal on 9 October 2026. The rules aim to restrict operators from using AI and automated systems to analyse customer behaviour for targeted marketing and wagering recommendations without consent.
The proposal forms part of New York’s wider effort to strengthen consumer protection in its regulated sports betting market. Regulators are also advancing separate rules to identify and support customers who may be experiencing gambling-related harm.
Both proposals will undergo further public consultation before returning to the Commission for consideration and a possible final vote.
Proposed Rules Target AI-Driven Betting Promotions
Under the proposed regulations, licensed sportsbooks, their affiliates and technology providers would face restrictions on using AI, machine learning, algorithmic profiling and other automated systems to analyse individual customer data.
The rules would cover personalised promotions, bonuses, odds, betting limits, marketing messages and product recommendations.
Operators would also be restricted from using these technologies to recommend specific wagers, betting markets or stake amounts. Targeted promotions designed to increase customer spending or engagement would also fall under the proposed restrictions.
However, the rules would allow personalised services where customers have given their consent. This means the proposal would not introduce a complete ban on AI in sports betting.
Pari-mutuel horse racing would also be exempt from the measures.
The NYSGC has drawn on a similar regulatory framework introduced in New Jersey. That approach also seeks to control how automated technologies are used in gambling marketing rather than prohibit them entirely.
New Responsible Gambling Requirements for Sportsbooks
Alongside the AI proposal, commissioners advanced separate rules requiring mobile sportsbooks to identify customers showing potential signs of problem gambling.
Each licensed operator would need to appoint an individual responsible for engaging with identified customers and addressing concerns about their gambling behaviour.
The measures aim to encourage earlier intervention and strengthen customer protection across the industry.
Read Also: New York Sports Betting Revenue Slightly Declines in January 2026
NYSGC Chairman Brian O’Dwyer also raised concerns about customers moving between licensed sportsbooks after another operator has identified them as potentially at risk.
He called for greater cooperation and information sharing among operators. This could help prevent vulnerable customers from bypassing protective measures by opening accounts with different sportsbooks.
“The mobile sports betting industry has long maintained that they considered integration of responsible gaming practices a significant element of their business,” O’Dwyer said.
He warned that regulators could intervene further if operators failed to address the problem.
“The industry is on notice by me and this Commission that they need to solve this problem,” he added. He also indicated that the Commission would act if the industry failed to find a solution.
New York’s Sports Betting Industry Responds
The proposed rules form part of Governor Kathy Hochul’s broader consumer protection programme. The initiative includes measures addressing underage gambling, marketing practices targeting vulnerable customers and gambling addiction.
New York currently has nine licensed mobile sports betting operators. These include DraftKings, FanDuel, BetMGM, Caesars Sportsbook and Fanatics.
The state also applies a 51% tax rate to gross gaming revenue from mobile sports wagering.
Sports Betting Alliance President Joe Maloney said the industry would continue working with regulators as the proposals progress. He also highlighted the contribution of New York’s regulated betting market.
According to Maloney, the state’s licensing framework has offered consumers a regulated alternative to illegal gambling since 2022. Licensed operators have also generated more than $1 billion in annual tax revenue, he said.
What the Proposed AI Rules Mean for Sportsbooks
If adopted, the proposed regulations could require sportsbooks to reassess how they use AI to personalise marketing and recommend bets.
Operators may need to review their customer profiling systems, consent processes and promotional strategies to ensure compliance with the final rules.
The separate responsible gambling proposal could also increase expectations around customer monitoring and cooperation between licensed operators.
However, neither proposal has been finalised. Both remain subject to public consultation and further Commission consideration.
