DraftKings Rewards Problem Gamblers with VIP Status Despite Responsible Gaming Prompts

Key points

• Pearson lost $12,500 over 10 weeks, including $1,800 in a single night, before receiving a VIP invitation.
• DraftKings sent 32 responsible gaming notices during the period, but promotions often followed immediately after warnings.
• The company uses AI to identify 'elastic' customers likely to lose, while allegedly shelving predictive models for problem gambling risk.
• Pearson played 500 rounds of blackjack in two days, accounting for half his total betting activity, in New Jersey where iGaming is legal.
• DraftKings CEO Jason Robins stated iGaming legalization is a 'when, not if' issue, citing customer demand and tax revenue.

Background

This story follows earlier coverage of aggressive engagement tactics in sports betting apps, including VIP perks and data tracking. A September 2026 CBS News investigation highlighted similar concerns with FanDuel, while lawsuits argue these platforms are designed to be addictive. The current report expands on these themes by testing the efficacy of responsible gaming tools against real-world user behavior.

How outlets are covering it

ProPublica emphasizes the contradiction between DraftKings' responsible gaming prompts and its promotional pushes, noting that warnings were easily dismissed. The New York Times, cited by Defector and NEXT.io, reports that DraftKings uses AI to target losing customers while shutting down predictive models for problem gambling. DraftKings, through chief responsible gaming officer Lori Kalani, argues its tools are adequate and that promotions target engaged users, not problem gamblers. Critics like Rob Minnick argue that expecting a profit-driven company to protect consumers is ineffective, while EFF frames the issue as predatory behavioral advertising. FanDuel, per CBS News, claims its tools empower customers with real-time information, though it declined to specify intervention frequencies.

Why it matters

With Americans wagering over $600 billion since 2018, the effectiveness of self-regulation by gambling companies is under scrutiny. If responsible gaming tools fail to prevent harm for users exhibiting clear problem behaviors, regulators may need to impose stricter consumer protections. The debate extends to whether AI-driven targeting should be banned or regulated, given its potential to exploit vulnerable users for profit.

What to watch

Regulators in states like Colorado and Massachusetts are proposing stricter consumer protections. DraftKings is working on allowing users to toggle off casino features, per Kalani. The New York Times investigation and CBS News report may lead to further scrutiny of AI targeting practices. ProPublica is collecting betting data from users to analyze app behavior. The outcome of these efforts will determine whether current self-regulation models are sufficient or if legislative intervention is required.