Senate hearing spotlights split over prediction markets and sports‑betting integrity

The Senate Committee on Commerce, Science, and Transportation held a subcommittee hearing to examine threats to the integrity of American sports and consumer harms tied to the rapid expansion of sports betting and prediction markets. Senators, state regulators and industry representatives debated whether prediction markets operate under federal commodity law or are effectively sports sportsbooks that circumvent state and tribal safeguards.

The chair opened the hearing by saying recent match‑fixing scandals and the proliferation of instant mobile wagering had eroded public trust in sports. "When Americans watch their favorite sports team, they don't want to worry about the game being rigged," she said.

Bill Miller, president and chief executive officer of the American Gaming Association, told the panel that prediction‑market platforms are "running national sportsbooks" without the regulatory constraints that licensed state and tribal operators face. He cited the legal gaming industry's economic footprint — "1,800,000 American jobs" and more than "$100,000,000,000 in employee wages" in his testimony — and said prediction markets had cost states and tribes tax revenue while weakening consumer protections. "Prediction markets aided by a rogue CFTC are making a mockery of congressional intent," Miller said.

Maribeth Thomas, executive director of the Tennessee Sports Wagering Council, described Tennessee's regulatory safeguards — a 21‑and‑older age limit, statewide self‑exclusion, geolocation checks, multifactor authentication, and regular audits of sportsbooks and their vendors. Thomas said Tennessee had investigated 25 potential integrity cases as of May 14, closed 17 and referred 13 to the FBI. "We ingest data from our sportsbooks and vendors to look for patterns," she told senators.

Scott Sainen, co‑founder and co‑CEO of Integrity Compliance 360, outlined integrity monitoring tools that flag suspicious correlated market movements and circulate alerts to operators, leagues and regulators. He described a product, ProBet, that propagates prohibited‑patron lists among platforms to prevent insiders from transacting.

Former Congressman Patrick McHenry, representing the Coalition for Prediction Markets, defended the products as federally regulated swaps overseen by the Commodity Futures Trading Commission (CFTC). He argued that exchange‑style prediction markets have a different business model from sportsbooks, generate federal oversight and can implement surveillance and AML controls. "These are two‑sided markets established by peer to peer," he said.

Dr. Harry Levant, director of gambling policy at the Public Health Advocacy Institute and a person in recovery, urged congressional action. He described micro‑bets and same‑game parlays as "fundamentally different, inherently dangerous" gambling products and warned that social‑media advertising and influencer content target teens and young adults. Dr. Levant offered two patient examples to illustrate how industry marketing and VIP retention tactics undercut self‑exclusion and recovery efforts.

Senators pressed witnesses on several recurring themes: whether the CFTC has the authority and capacity to oversee sports‑style event contracts, the economic impact on states and tribal gaming, the role of offshore illegal sportsbooks, and how to prevent minors' exposure to gambling advertising. The panel disagreed on whether the solution is stronger federal oversight, tighter state enforcement, or both; witnesses and 41 state attorneys general were cited as opposing unchecked CFTC expansion into gaming.

The hearing concluded with senators agreeing to continue legislative and regulatory work, including additional questions for the record due May 27 and responses expected by June 10. No formal votes or motions were recorded at the hearing.