New York May Restrict AI-Powered Gaming Promotions, But It Is Not Alone
by: Brian Schaller, Max Landaw and Tina Reid
Artificial intelligence is increasingly being used to personalize promotions, recommend products, identify likely customers, and automate marketing decisions. For companies operating in the gaming industry, these tools may provide significant benefits. They may also raise responsible gaming concerns from lawmakers and regulators, particularly when AI is used to determine which promotion or wagering opportunity is presented to a particular customer.
New York is now considering restrictions that directly address these practices in the gaming industry. Although the proposed language has not yet been adopted, New York is not alone. Connecticut considered, but did not enact, a restriction on certain uses of AI by sports wagering platforms, and similar measures have been proposed in Illinois and at the federal level.
New York Considers Restrictions on AI-Powered Promotions
The New York State Gaming Commission circulated pre-proposal responsible gaming language that would restrict certain uses of AI by gaming companies (see direct link to proposal, here). The Commission published the draft in late March 2026 and took comments by email until May 15, 2026 (see comments, here). Therefore, while the potential rule could have a major impact on the industry, it is still possible it will not be adopted in its current form, if adopted at all.
The potential rule would prohibit covered entities from directly or indirectly using “artificial-intelligence-powered services” to offer any individual customer, potential customer, or group of customers:
Personalized promotions;
Suggested wagers; or
Suggested wager amounts.
The proposed restriction would apply broadly across the New York gaming industry, including commercial casinos, mobile sports wagering platform providers and operators, video lottery gaming agents, certain horse racing and account wagering businesses, and lottery courier services.
In relation to AI, the pre-proposal’s focus appears to be the use of AI to personalize promotions and wagering suggestions. The language also applies to indirect uses of AI, which could potentially encompass third-party marketing platforms and service providers acting on a gaming company’s behalf.
A Separate New York Bill Takes a Narrower Approach
The Commission’s proposal is not the only New York measure addressing AI-powered gaming promotions.
New York Assembly Bill A8916 would prohibit mobile sports wagering licensees from using AI to track a bettor’s gambling habits and create individualized promotions based on those habits. The bill remains pending in the Assembly Racing and Wagering Committee.
The bill is narrower than the Commission’s pre-proposal discussed above in several respects. It would apply only to mobile sports wagering licensees, while the Commission’s proposal would cover the gaming industry broadly. The bill appears to focus on individualized promotions created from a bettor’s gambling habits. In contrast, the Commission’s pre-proposal would reach personalized promotions offered to individual customers or groups of customers, as well as suggested wagers and wager amounts.
Similar Restrictions Have Been Proposed Elsewhere
Similar language has been proposed in Connecticut, Illinois, and at the federal level. The Connecticut language did not survive amendment. These proposed legislative measures would prohibit sports wagering licensees/operators from using AI to (i) track an individual’s wagers, (ii) create an offer or promotion targeting a specific individual, or (iii) create a gambling product such as a microbet.
Illinois Senate Bill 2398 (see direct link, here) was re-referred to the Senate Assignments Committee in June 2025 and has not advanced since then.
The measures were in Connecticut House Bill 5229 but later removed by House amendment before passage and do not appear in the enacted law, Public Act 26-53. The Connecticut tracking prohibition also carried an exception for tracking to identify potential problem gamblers (see bill tracking, here).
At the federal level, the proposed SAFE Bet Act would require states that permit sports wagering to impose those same three requirements as minimum federal standards (see, here, for direct link).
None of these AI restrictions have been enacted. Nevertheless, the repetition of similar language across federal and state proposals may indicate an emerging approach to regulating AI within sports wagering.
What the Restrictions May Cover Is Not Always Clear
The measures generally do not define artificial intelligence[1] or explain how much involvement by an AI system is necessary for a promotion to be restricted.
Some applications of these measures appear relatively straightforward. For example, an AI system that analyzes an individual’s wagering history and independently selects a promotion for that person would appear to fall within the conduct addressed by these measures.
Other uses may be less clear. AI may be used to divide customers into segments, identify which customers are most likely to respond to an offer, determine when an advertisement should be delivered, or select among promotions that were created and approved by employees. AI may also be embedded within customer relationship management, analytics, and advertising platforms without the gaming company operating the underlying model itself.
New York’s proposed reference to the direct or indirect use of AI-powered services may be particularly important in this respect. If retained, the language could require covered companies to understand not only their own use of AI, but also how agencies, platforms, and other vendors use AI when selecting recipients or delivering promotions.
Where Is the Gaming Industry Headed with These AI Restrictions?
The current measures differ in their scope, but they seem to converge their focus on how AI uses customer information to influence future gambling activity. Although we are not aware of any current specific AI in gaming restrictions, it is prudent for companies involved in the gaming ecosystem to be prepared for potential regulation. As such, we recommend looking at your uses of AI and seeing whether any such tools are used to:
Track or analyze individual wagering activity;
Select customers or groups of customers for promotions;
Determine which promotion is presented;
Recommend particular wagers or wager amounts; or
Create or support individualized wagering products.
Third-Party Vendors & Tools
Many gaming operators rely on third-party vendors to fulfill these marketing functions. It is therefore incumbent on gaming operators to perform additional due diligence on their marketing, analytics, and technology providers regarding AI functionality embedded within their services.
[1] Though, Connecticut HB 5229 did define by cross-reference.
Originally published by InfoLawGroup LLP. If you would like to receive regular emails from us, in which we share updates and our take on current legal news, please subscribe to InfoLawGroup’s Insights HERE. This summary does not constitute legal advice.