L GAMBLING ADDICTION. IS IT A PROBLEM FOR BANKS? YOU BET IT IS. By Neal Reynolds, President, BankMarketingCenter.com Let’s face it. An addiction to gambling is a problem for banks. American Banker just ran an article about banks and gambling: “Why Gambling is Suddenly a Problem for Banks.” The timing of this article makes perfect sense as there has been a significant increase in the marketing messaging around gambling, especially during NFL games. Beer ads used to dominate during football games. Now, you see ads from brands like DraftKings and FanDuel. There are sites that regularly hawk these brands, such as Covers. Here’s the kind of stuff you’ll find there: “New bettors that register with the online sportsbook today receive $200 in Bonus Bets, plus any cash winnings, after an initial $5 wager. In other words, make an initial $5 qualifying bet and automatically receive an instant boost to your DraftKings account, regardless of the outcome of the wager and without the use of a DraftKings promo code.” Same as the commercials. These brands are spending big money to hook new customers. How big is this problem? Big. The impact of gambling addiction stretches beyond individuals struggling with it. Gambling addiction also has an inherent “social cost,” experts say, a cost that is paid by American taxpayers. The National Council on Problem Gambling (NCPG) estimates that the annual national social cost of problem gambling is $7 billion. These costs include gambling-related criminal justice and healthcare spending as well as job loss and bankruptcy. This number, the association says, is probably far below the actual cost as numbers are hard to track, and there’s not a whole lot of research being done on the subject. Colorado Banker 14
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