HR-9706-119
Referred to the Committee on Agriculture, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Sponsored by Josh Gottheimer (D-NJ)
What it does
This bill would require operators of sports wagering platforms and prediction market platforms to use facial recognition technology to verify that users are over 18 before allowing access or accepting wagers/orders. It also limits how much biometric data operators can collect and requires deletion of data not needed for age verification, with enforcement by the Federal Trade Commission. Separately, the bill amends the Commodity Exchange Act to give the Commodity Futures Trading Commission new authority to review and potentially prohibit certain "event contracts" (a form of prediction market contract) deemed contrary to the public interest, and creates new CFTC offices including an Advisory Council on Consumer Protection and an Office of the Retail Advocate.
Who benefits
Minors who might otherwise access wagering or prediction market platforms, and their families, would gain a technological barrier to access. Facial recognition technology vendors could see new business from mandated compliance. Consumer advocacy groups would gain a formal voice through the new Retail Advocate office and Advisory Council. State attorneys general retain enforcement roles under the bill's rule of construction.
Who is hurt
Wagering and prediction market operators would bear compliance costs for implementing facial recognition systems and data minimization/deletion protocols. Adult users may face privacy concerns or friction from biometric scanning requirements. Smaller platforms may face proportionally higher compliance costs than larger, well-capitalized competitors. Event contract markets tied to gaming, violence, or other CFTC-flagged categories could be barred from listing certain contracts, affecting traders and platforms like those offering political or sports-outcome contracts.
Supporters argue
Supporters argue that facial recognition offers a more reliable age-verification method than self-reported birthdates or ID uploads, which can be falsified, and that protecting minors from gambling and speculative trading platforms is a compelling public interest given research linking early gambling exposure to later addiction. They contend the bill also fills a regulatory gap in the fast-growing prediction market industry by giving the CFTC explicit tools to block contracts tied to violence, terrorism, or unlawful activity, and by creating consumer protection infrastructure similar to safeguards in traditional financial markets.
Opponents argue
Opponents argue that mandating facial recognition creates new privacy and data security risks, since biometric data breaches are irreversible in a way that password breaches are not, and that the data minimization provisions may not fully prevent misuse or secondary collection by technology vendors. They contend the CFTC's new authority to deem event contracts "contrary to the public interest" based on vague categories like "other similar activity" grants the agency broad discretionary power that could be challenged as insufficiently guided rulemaking, particularly after courts began requiring clearer statutory authorization for consequential agency actions.
Constitutional context
Congress's authority to regulate wagering and prediction market platforms rests on the Commerce Clause, given their interstate and often online nature. The CFTC's expanded discretion to bar event contracts based on broad, undefined categories may draw scrutiny under the nondelegation principle and, after the end of automatic deference to agency interpretations, face independent judicial review of whether the statute clearly authorizes such determinations.
Checks and balances
The bill expands executive branch authority by empowering the FTC to enforce age-verification rules and the CFTC to determine which event contracts are barred as contrary to the public interest, with courts retaining review authority and Congress reserving oversight through mandated reports from new CFTC advisory bodies.
Historical precedent
Federal age-verification mandates using biometric technology for online platforms are largely untested; the bill's CFTC event-contract provisions build on ongoing regulatory disputes over whether prediction markets on political and sports outcomes qualify as permissible derivatives under existing commodities law.