Since the Supreme Court cleared the way for states to legalize sports betting in 2018, a majority of jurisdictions have done just that. Georgia has not, though state legislators have discussed the possibility of a voter referendum on this subject in the next couple of years. Anyone who watches sports on television can recognize the massive revenue being generated through online sports wagering from all of the commercials from companies such as DraftKings and FanDuel.
What you can’t tell from the advertisements is that researchers have identified a significant link between legal sports gambling and increased bankruptcy activity. UCLA professor Brett Hollenbeck’s research found the likelihood of bankruptcy filing rose between 25 and 30 percent in states where online betting was legalized, translating to approximately 30,000 additional bankruptcies nationwide.
Problem gambling often coincides with high-interest credit card use, cash advances, payday loans and missed household obligations. Of course, sports betting existed long before the internet and takes many forms, even in states such as Georgia where it’s not legal. However, Hollenbeck found that the major shift in bankruptcy filings occurred when people became able to place wagers from their smartphones. Instead of having to travel to a casino sportsbook, possibly out of state, fans can make bets with virtually no effort, possibly dozens of time during a particular game.
Sports betting accounts are typically funded by cards or bank transfers—transactions that can compound quickly with fees and interest. When payments fall behind, collection efforts escalate, judgments can be entered and wage garnishments or bank levies may follow. Some consumers also face account closures or disputes over chargebacks.
For individuals and families overwhelmed by gambling-related debt, bankruptcy can provide a path to stability. Gambling debts and resulting credit-card balances are generally unsecured and may be dischargeable through a Chapter 7 proceeding. However, very recent charges, cash advances, or debts incurred through misrepresentation can be challenged by creditors. A good-faith effort to treat a gambling addiction can also strengthen a debtor’s case. When you speak with a qualified bankruptcy lawyer, they can review your situation and explain how they can help you.
Jeff Field & Associates handles of full range of bankruptcy matters for Georgia clients. Please call 404-381-1278 or contact us online to schedule a consultation. Our offices are in Douglasville, Gainesville, Bogart, Lawrenceville, Marietta and Decatur.