Michigan sports betting bill seeks cover for ‘bona fide’ friends

A new bill in Michigan aims to make sports betting on contests like Super Bowl squares and March Madness pools among “bona fide” friends legal.

State Senator Veronica Klinefelt this month introduced Senate Bill 511, which would amend the Michigan Penal Code to allow for wagers “incidental to a bona fide social relationship and meets other conditions”. The bill would create a legal carveout for contests like squares and bracket pools among friends and coworkers.

The Senate Regulatory Affairs Committee held a hearing on the bill on Thursday but did not take a vote.

“Its sole purpose is to legalise what we do every day, what everybody does all the time, bets their best friend $5 on a football game, people do March Madness and Super Bowl squares with their friends, nobody is making any money,” Klinefelt said during the hearing.

Klinefelt said she is not the first person to come up with the idea for the bill. However, she said no one brought her the bill to introduce and she came up with it on her own.

Michigan Governor Gretchen Whitmer signed online sports betting and iCasino into law in 2019, and online operators launched in 2021. Gross online gambling revenue hit a record $312.5 million in August.

The first tribal casino in Michigan opened in 1984 with 23 now operating, along with three commercial casinos in Detroit.

What is in the Michigan ‘bona fide’ bill?

Under the Michigan Penal Code, wagers between private parties are a misdemeanour punishable by a fine of not more than $1,000 and up to a year in prison. Klinefelt’s bill raises the fine to $5,000 but also establishes a set of guidelines for allowable wagers:

• The contest or wager is “incidental to a bona fide social relationship”.
• No more than 100 participants.
• Maximum wager is $25.
• Entire amount is paid to one or more participants as a prize.
• Organiser must be a participant and only benefit can be winning the prize.
• The transaction does not take place inside a casino, restaurant, bar, entertainment venue and was not promoted by a business.

Klinefelt said some senators would like to see the maximum wager increase to $100.

Is MI sports betting bill actually needed?

Senator Michael Webber said he would be surprised if any agency is enforcing the rule because such contests are fun between friends and coworkers. While Webber said he is open to listening, he was wary about getting the regulatory structure involved.

Klinefelt said no one is cracking down on the practice, but that it is a common occurrence that is against the law and should not be.

She said she has bipartisan support for the bill but acknowledged the casinos in the state are “taking great concern”, in part because they believe it would violate a 2004 state law requiring voter approval for gambling expansion. Multiple gaming tribes also submitted opposition to the bill. Klinefelt said she is open to working with people to make the bill “more comfortable”.