New York Keeps 51 Cents of Every Dollar Its Gamblers Lose, and the Addiction Tripwire It Just Proposed Doesn't Trip Until a $10,000 Single-Day Deposit

The figure is in New York State Gaming Commission data, carried to the penny: $3,889,872,492.15. That is what New York has collected in tax from online sports betting since the apps went live in January 2022, and it is not an estimate. It is arithmetic written into statute. New York taxes a sportsbook’s gross gaming revenue at 51 percent, the highest rate in the country, and gross gaming revenue is only another name for the money bettors lose. At that rate, a $3.89 billion tax take means New Yorkers have lost roughly $7.6 billion to the apps, and the state has kept $3.89 billion of it.

In 2025 the losses accelerated. By Covers tally of state figures, New Yorkers wagered $26.3 billion and lost $2.55 billion, a 25 percent jump in a single year, and Albany’s cut came to $1.32 billion. Joe Maloney of the Sports Betting Alliance framed the year the way the industry prefers, noting that legal betting has delivered nearly $4 billion for the state’s public education system. The claim is accurate. It also describes a government whose schools are funded, in part, by how much its residents cannot stop betting.

On October 9, that same government moved to address the harm it collects on. ProPublica reported that the New York State Gaming Commission voted unanimously to propose two rules aimed at problem gambling. The first would require sportsbooks to watch for at-risk bettors and do more due diligence into a customer’s “financial vulnerability.” The second would bar operators from using artificial intelligence to tailor bonuses and wagers. A 60-day public comment period follows, after which the rules return to the Commission.

The first rule adopts guidelines New Jersey already uses, and the New Jersey numbers are the ones on the record. DraftKings says it already follows them: a sportsbook owes a closer look when a customer deposits more than $10,000 in a single day or wagers more than $1 million over 90 days. The only trigger New York has spelled out on its own is behavioral rather than financial, a bettor’s time on the app jumping 50 percent in a week against the prior two weeks. Those are the lines a gambler has to cross before the system is required to look closely.

Measure a documented case against those lines. In its investigation, ProPublica had a reporter deposit $21,600 into a DraftKings account in under eight weeks while betting as compulsively as he could. The behavior drew no company review and no intervention beyond routine responsible-gaming notices. DraftKings says it sent the account more than 30 such messages, and its chief responsible gaming officer, Lori Kalani, concluded that “the system worked the way it was supposed to.” The company rejects any implication that its marketing practices are unfair or improperly target customers. Problem gambling, ProPublica noted, can manifest in much smaller amounts than the thresholds are built to catch.

What the thresholds do not reflect is where the documented harm sits. A study of roughly seven million people in the University of California Consumer Credit Panel, published in Management Science by Brett Hollenbeck, Poet Larsen, and Davide Proserpio, found that the arrival of online sports betting cut average credit scores by about 12 points, and that roughly two years later the likelihood of bankruptcy rose by about 10 percent in states that allowed it, alongside more debt sent to collections and more delinquent credit cards and auto loans. The authors cannot see which people in the panel actually bet, so these are averages across all residents; the effect on bettors themselves, they write, is likely several times larger. A separate 2026 analysis in Health Economics found that legal online betting raised binge-drinking days among younger men by about 0.46 days, close to 10 percent above the baseline. The damage in these records does not begin at a $10,000 deposit. It accumulates a few hundred dollars at a time, and it lands hardest on the young and the broke.

The documents do not establish that the Commission set the bar high to protect revenue. They establish something narrower and harder to argue with. The body writing the rules and the body that collects 51 cents of every dollar lost are the same body, and a dollar a problem gambler does not lose is a dollar that never enters the pool New York taxes. The regulator’s budget rises with the behavior the regulator says it wants to curb. That is not a motive anyone has to confess to. It is a conflict built into the structure.

It also shapes who is being asked to do the policing. Commission chair Brian O’Dwyer said the proposal would “provide an opportunity for the industry to illustrate its commitment,” and warned that “if the industry does not address it, then we will address it.” He acknowledged “the limitations of this proposal,” and urged the state’s nine licensed mobile sportsbooks to share data so a flagged gambler cannot simply move to the next app. FanDuel said it “welcomes the opportunity to engage with regulators.” The industry’s trade group, the Responsible Online Gaming Association, had already told the Commission in a May comment letter that the rules “establish a strong framework for responsible gaming,” and asked that any intervention be “proportionate, operationally scalable, and effective.” Brianne Doura-Schawohl, who presses for stronger gambling regulation, was blunter, calling New York and New Jersey “clearly complacent in the status quo.” A 2024 review in The Lancet Regional Health – Americas found the evidence base on how to prevent gambling harm still thin, which leaves the thresholds, and the pace of enforcing them, a matter of the regulator’s judgment.

So account for what has not happened. The binding vote that would actually obligate the sportsbooks has not been scheduled; it sits 60 days away at the earliest, before the same Commission that has collected $3.89 billion from the losses it now proposes to monitor. The data-sharing that would keep a flagged gambler from app-hopping is something O’Dwyer has urged and not required. Governor Kathy Hochul’s answer to rising addiction was to commission a 10-year survey of residents’ gambling behavior. The evidence of harm is already filed, peer-reviewed and dated. The response is a comment period, an invitation to self-regulate, and a study that will run for a decade. The Commission has the authority to set the thresholds where the harm actually starts. It has not used it.

Sources

1. ProPublica – New York Plans Stronger Sports Betting Regulation to Curb Gambling Addiction (Oct. 9, 2026)
2. Long Island / New York State Gaming Commission data – online sports-betting tax revenue since the January 2022 launch (Jan. 8, 2026)
3. Covers – New York 2025 handle, gross revenue, and tax totals (Jan. 9, 2026)
4. Management Science – Hollenbeck, Larsen & Proserpio, “The Financial Consequences of Legalized Sports Gambling”
5. Health Economics – “Gambling and Substance Use: Early Evidence From Sports Betting Laws” (2026)
6. The Lancet Regional Health – Americas – “Sports betting scandals highlight knowledge gaps for gambling harm” (2024)