US Sen. Schatz proposes federal ban on micro prop bets, crackdown on offshore gambling payments

US Sen. Brian Schatz plans to introduce legislation that would outlaw micro prop bets in games and provide the Federal Trade Commission with authority to go after companies that knowingly facilitate illegal, offshore gambling.

Schatz discussed the proposal during a Senate Commerce subcommittee hearing on sports betting, where lawmakers and gaming experts examined concerns tied to offshore operators and micro prop betting markets.

According to Schatz, the legislation would allow the FTC to pursue payment processors facilitating payments for illegal offshore sportsbooks.

“We think we, legislatively, have a pathway here. It doesn’t solve every problem, and it certainly doesn’t solve every problem as it relates to the challenges that individuals and society [are] facing with gambling,” said Schatz, a senior member of the Senate Commerce Committee.

“But if you empower the FTC to go after the payment processors, then they would have a perfect right to go and say, ‘You may not work with these offshore shops if they are not complying with federal law having to do with micro prop bets.’”

The proposed legislation would also outlaw micro prop bets in sports games.

Senate hearing examines betting risks

During the hearing, Schatz discussed vulnerabilities linked to micro prop wagers, which focus on isolated moments or actions during sporting events.

“Micro prop [bets are] insidious in that [they] can be manipulated by a player or anyone else,” said Schatz. “The more micro you get, the more insidious it is, from an integrity standpoint. But it also taps into the addictive, manic, algorithmically-driven problem that we’re dealing with. I think this particular problem is especially acute and needs to be dealt with immediately.”