Congressman Josh Gottheimer of New Jersey — with Kalshi co-founder Tarek Mansour by his side — introduced a bill Wednesday that would require facial recognition for use of prediction markets and online sportsbooks.
Per a press release from Gottheimer’s office, the bill has bipartisan support and would require the use of facial recognition technology as part of the know-your-customer process as well as before a wager is placed. Such technology would be required to “read facial structure patterns to estimate a user’s age,” but it would not store the customer’s identity or biometric information.
Text of the bill was not posted on Congress.gov as of Thursday morning.
In the press release introducing the “Facial Recognition to Protect Children Act,” Gottheimer leaned into the argument that underage — and primarily male — bettors are at high risk for gambling addiction and that technology companies offer legal video games with loot boxes and other enticements that “train their brains on that same dopamine loop, priming them to bet with real money.”
At a press conference, Gottheimer said current KYC laws and regulations create a situation where underage players are asked to “self-police” in “a system built entirely on the honor code.”
Said co-sponsor Rep. Ritchie Torres of New York: “Online gambling and prediction markets are expanding rapidly, but our guardrails to protect minors haven’t kept pace. Right now, the honor system is failing our kids, allowing underage users to bypass basic age restrictions with zero accountability. By implementing proven facial recognition technology, we can safeguard children from the risks of underage gambling while protecting user privacy.”
Legal sportsbooks not represented
The bill joins more than a dozen more in Congress that seek to set federal guidelines around prediction markets. Most have been narrow in focus, and many look to keep politicians and their staffs from using inside information to capitalize on prediction markets.
The difference is that Gottheimer’s bill includes legal sportsbooks, which are regulated at the state level. Prediction markets are regulated at the federal level.
A press release from Gottheimer’s office did not indicate that the bill has any support from legal sportsbooks. InGame did not get an immediate reply to an inquiry about the proposal to the Sports Betting Alliance, comprised of bet365, BetMGM, DraftKings, Fanatics Betting & Gaming, and FanDuel.
“Protecting kids should be a no brainer and is a top priority at Kalshi,” said Tarek Mansour, CEO of Kalshi. “Beyond what’s required of us, we already self-regulate and have a suite of measures in place to keep minors off our platform. But this can’t just be one company’s responsibility — it has to be an industry standard.”
