DraftKings used AI to target losing bettors: ‘The best investment would be a problem gambler'

Former DraftKings employees say the company sent promotional offers to the very gamblers who were most likely to rack up losses, according to a report. The sports gambling giant used AI and data science to help determine which customers should receive promotional offers, the New York Times reported, citing whistleblowers. DraftKings internally used a measure it called “elasticity,” to estimate how much more a gambler might wager if offered the right promos. “The best investment would be a problem gambler,” former DraftKings data analyst Jayden Butts told the Gray Lady. The company was trying to figure out if the money it spent on promos like free bets would pay off by getting gamblers to place more wagers, Butts explained. “And if the answer is yes, open the floodgates,” he told the newspaper. Six former DraftKings employees who worked on promotional targeting said they later regretted helping build technology they viewed as dangerous. “It is as predatory as it sounds,” one former DraftKings analyst told the Times. “If you lose more, we give you more, so you keep playing more.” A DraftKings spokesperson rejected the report, saying it’s “built on a false premise.” The piece “portrays routine promotional reinvestment practices common across consumer-facing industries as scandalous,” the spokesperson told The Post. “And it asks readers to accept, on the word of a few former employees, that DraftKings should not have evolved our development efforts from an unvalidated, early-stage data model to a regulator-informed, evidence-based responsible engagement system.” The company touted its naming of a “chief responsible gaming officer” who reports directly to the CEO, as well as a department of more than 50 full-time employees “focused on responsible engagement.” “Responsible engagement is not a side initiative,” the company rep said. “It is embedded across our business and essential to DraftKings’ long-term sustainability.” The starkest example cited by the Times was that of Bryan Biehl, who told the Times he lost nearly $70,000 gambling online, more than half of it through DraftKings. Biehl said that when he began therapy for gambling addiction in late 2024, promotional emails from DraftKings became a relapse risk. “I would get flooded with bonuses and deposits,” he told the Times. “If you are in addiction, you are not going to say no.” Emails reviewed by the newspaper showed that Biehl received 40 DraftKings promotions during the first two weeks of December 2024. He said he gave in to temptation one final time on Christmas Day, before placing himself on self-exclusion lists that blocked him from gambling apps. DraftKings declined to comment to the Times on Biehl’s account, though it rejected the suggestion that its promotional practices improperly target customers. The company told the Times that promotions are “directed toward customers who demonstrate sustained, engaged use of our platform, not toward customers based on their losses,” and said it “rejects any implication that its marketing practices are unfair or improperly targets customers.”