DraftKings AI Ad Targeting Draws Privacy Backlash
DraftKings is using artificial intelligence to identify customers who are losing money and to target them with tailored advertising, according to a New York Times investigation cited by the Electronic Frontier Foundation (EFF) on September 24, 2026.
The digital rights group says the sportsbook operator’s use of AI “supercharges the harms” of online behavioral advertising, a practice EFF has long argued should be banned outright.
How DraftKings' AI Targeting Works
According to the Times, DraftKings trains a machine learning model on its own customers' betting records to find gamblers who are consistently losing.
Once flagged, EFF says, those customers are sent targeted promotions designed to lure them back to the platform to place more bets - wagers the company's own model expects to lose.
EFF, a non profit organization defending civil liberties in the digital world, argues DraftKings has a clear business incentive to keep these customers engaged, since losing bettors are the users generating the most revenue for the operator.
People who meet the commonly used definition of a “problem gambler,” meaning someone who keeps gambling despite harm to their finances, health or relationships, are highly likely to be caught by this kind of model, the group said.
Why Privacy Advocates Are Alarmed
Devanshi Nishar, who authored the EFF post, wrote that adding AI to behavioral advertising magnifies its harms because AI systems process far larger volumes of personal data, and operate as a “black box” that makes it difficult for even the companies building the models to know which data points are driving the targeting.
That dynamic, EFF says, pushes companies to keep collecting more data rather than less. Notably, EFF says DraftKings appears to rely solely on “first-party” data collected directly from its own users, rather than data purchased from outside brokers.
The group argues that undercuts policy proposals that only restrict third-party data sales, since a company can still build harmful targeting models using data it already holds.
Part Of A Wider Data Privacy Debate
EFF ties the DraftKings case to a broader debate over online behavioral advertising, which it says fuels a wider surveillance industry: data collected for ad targeting is regularly resold to insurers, banks and law enforcement agencies, including US Customs and Border Protection.
The group also pointed to a recent Immigration and Customs Enforcement request for information asking how commercial ad-tech and “Big Data” providers could support its investigations.
EFF's recommendation is a blanket ban on behavioral advertising rather than narrower data-sharing rules, arguing that if companies cannot personalize ads based on user data, they lose much of the incentive to collect it in the first place.
DraftKings has not publicly responded to the Times investigation or the EFF post. Consumers concerned about how their own data is used can review responsible gambling tools and self-exclusion options offered by licensed US operators.
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