Blumenthal presses FanDuel on VIP bettor videos, and puts Kalshi next in line

Sen. Richard Blumenthal says FanDuel still owes Congress specifics about its VIP bettor program, the kind of loyalty program sportsbooks use to attract and keep high-volume bettors, and he plans to put the same questions to DraftKings and to prediction markets such as Kalshi and Polymarket, he told Front Office Sports. On Tuesday, Blumenthal and Reps. Paul Tonko of New York and Valerie Foushee of North Carolina sent a letter saying FanDuel had not adequately answered which athletes and celebrities recorded videos for VIP bettors, or what safeguards keep the program from enticing problem gamblers to keep betting.

The fight started this summer, after a personalized video Bryce Harper recorded in November 2024 for a man deep in gambling debt became public. FanDuel had bought it through the video-message platform Cameo and sent it as part of its VIP program. In a four-page letter on Sept. 24, FanDuel said it “shares your commitment to protecting bettors from harmful gambling” and disclosed that it had sent roughly 30 videos of athletes and entertainers over the last two years. It did not say who recorded them. Blumenthal told FOS the letter “evasively dodges a lot of significant questions.”

Kalshi used the moment to draw a line. Spokesperson Elisabeth Diana told FOS the company does not offer targeted promotions, offers or bonuses when customers lose. “By definition, a VIP at a sportsbook or casino is a losing customer or someone they expect to lose,” she said. “That’s because the gaming industry only makes money when people lose.”

Her point rests on how a sportsbook works. It is the house: it sets the price of a bet, takes the other side, and decides what it will pay if a customer wants out before the game ends. A bettor who wins is a cost. A bettor who loses a lot is the customer worth a personal video. Last month, Bitter Fool covered a New York Times investigation describing a 2023 DraftKings system that ranked casino players by how much they were expected to lose after a free bet or bonus. DraftKings disputed that framing.

Kalshi runs a VIP loyalty program too, with access to merchandise and referral incentives, and says that program doesn’t take users’ “wins and losses into account.” On a prediction market the platform creates the markets, and market makers such as Susquehanna post buy and sell prices so a customer can trade even when nobody is waiting on the other side. Kalshi, DraftKings and FanDuel each have their own market-making arm. All three say those are separate businesses that don’t give them an informational or trading advantage.

That makes “we’re not the house” a claim about a wall inside the company. If a platform’s own affiliate is posting the prices its customers trade against, the customer is still betting against someone with a stake in the result, and the question of who profits when the customer loses is still on the table. Blumenthal is already skeptical that prediction markets are different enough from sports betting to be regulated federally instead of by the states. In March he and Sen. Andy Kim introduced the Prediction Markets Security and Integrity Act, which would add safeguards against insider trading and market manipulation and ban markets on war, death and military action.

Polymarket pointed FOS to new user tools, including voluntary self-exclusion, deposit limits and access to mental health resources. DraftKings and FanDuel did not immediately respond to requests for comment.

The questions FanDuel has spent the summer answering in general terms, which stars and which safeguards, are now headed to prediction markets, including one that runs a VIP program of its own.

Sources

• Front Office Sports: DraftKings, Prediction Markets Put on Notice Amid FanDuel VIP Scrutiny
• Bitter Fool: DraftKings elasticity score chased expected post-bonus losers