A perennial ethical question facing gambling businesses like racetracks and advance deposit wagering firms is becoming even more pertinent in the age of big data and powerful predictive analytic techniques to search for insights.

To what degree should these companies scrutinize the play of their customers in order to identify problem gamblers and take remedial action, ranging from issuing a gentle reminder to cutting them off? The decision is difficult because at-risk gamblers are among a racetrack or ADW firm’s most dependable sources of revenue and the issue broaches the provocative topics of confidentiality and privacy.

A Wall Street Journal article reported that Harvard Medical School researchers and others have employed data that casinos collect for customer loyalty programs to develop statistical algorithms capable of recognizing people who are overindulging in gambling. Though some casino chief executives have shared their customer-loyalty databases with gambling-addiction researchers, they have mostly resisted the notion that it is a casino’s responsibility to pinpoint and possibly restrict compulsive gamblers. Gary Loveman, CEO of Caesars Entertainment, called it a “terrible idea” and asked rhetorically if McDonald’s should be obligated to screen for diners who order too many unhealthy meals?

The Journal stated that courts have so far rejected the argument that “casinos are liable for the behavior of addicted patrons” in the same way that bars can be held negligent for serving intoxicated individuals. However, some legal experts believe that once gambling-addiction analytics are further refined, courts might reverse their long-held position.

Questions of business ethics frequently do not fit neatly into categories of right and wrong. Racetracks are confronted with such a moral gray area because of the wealth of information they have on hand pertaining to the betting patterns of members of loyalty programs and ADW patrons, coupled with the availability of algorithms to sort out people who bet too much for their own good.

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