Cortez Masto, Curtis Push CFTC for Answers on Enforcement of Illegal Gaming in Event Contracts

Washington, D.C. - Today, U.S. Senators Catherine Cortez Masto (D-Nev.) and John Curtis (R-Utah) led four of their Senate colleagues in a letter to Commodity Futures Trading Commission (CFTC) Acting Chair Caroline Pham reminding the Commission sports betting is regulated by states and tribes, not the CFTC. The Senators underscore that by implicitly allowing some companies to offer sports betting activities as "event contracts," the CFTC is preventing enforcement of state and tribal gaming laws which inappropriately permits sports betting nationwide.

"The CFTC is expressly prohibited from allowing event contracts that involve gaming, are unlawful under federal or state law or are contrary to the public interest," wrote the Senators. "Despite this prohibition, the CFTC is permitting sportsbook gaming to inappropriately designate themselves as 'event contracts' with oversight by the CFTC. For example, some companies are claiming to allow legal sports betting in all fifty states. This action - and the CFTC's unwillingness to stop it - contradicts both the letter and the intent of the law. The Commission cannot sidestep its statutory obligations by declining to enforce the prohibitions that Congress enacted. Doing so undermines the sovereign authority of states and tribes to regulate gambling within their jurisdictions and risks federalizing an area of law that the Supreme Court has held is reserved to the states."

"The continued availability of illegal sport event contracts in all 50 states further reaffirms the need for the CFTC to enforce its own regulations mandated by Congress. Moreover, by claiming to be federally regulated by the CFTC, issuers of sports event contracts can avoid myriad state laws, including licensing and background investigations, minimum age requirements, federal anti-money laundering rules, and consumer protections such as addiction warnings and integrity monitoring. These rigorous standards are required by state and tribal licensed entities which the CFTC does not have the authority or the capacity to replicate," the Senators concluded.

Read the full letter here. Additional signatories include Senators Ruben Gallego (D-Ariz.), Alex Padilla (D-Calif.), Adam Schiff (D-Calif.), and Elissa Slotkin (D-Mich.).

Senator Cortez Masto is a champion of Nevada's tourism and gaming economy. Following the passage of the Republican tax law, which imposed greater taxes on gamblers, Cortez Masto introduced the FULL HOUSE Act to restore the 100% tax deduction on gambling losses. Earlier this month, she introduced the WAGER Act, bipartisan legislation to protect legal sportsbooks and gaming businesses and help states like Nevada and Tribal communities reinvest their gaming revenues into their local economies. In the American Rescue Plan, Senator Cortez Masto secured $3 billion in funding to assist states with their economic recovery and their vital tourism industries, including Nevada. She also delivered resources to the state's businesses and secured flexibility for the gaming industry.

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