Proposed legislation in New York would address the use of artificial intelligence (AI) in therapy — including treatment for gambling addiction.
As of late 2025, New Yorkers and visitors to the state have wagered $72.8 billion on sports gambling since 2022, according to state figures compiled by Legal Sports Report.
With over 50% of online bettors chasing losses, demand for addiction resources is growing.
The New York legislation could affect technology and telehealth startups trying to develop AI chatbots to help treat gambling addiction amid the growing crisis. AI gambling bots have shown to display addiction-like behavior.
For many reasons, artificial intelligence in addiction treatment is highly controversial.
AI Gambling Therapy Regulation in New York
The Oversight of Technology in Mental Health Care Act (S8484) was introduced in late August 2025 by state Sen. Kristen Gonzalez.
Licensed mental health care professionals could not use AI to:
- make independent therapeutic decisions
- directly interact with clients in any form of therapeutic communication
- generate therapeutic recommendations or treatment plans without review and approval by the licensed professional
- detect emotions or mental states
Her bill would allow patients to consent to some AI use. People with gambling addiction could consent to AI-recorded/transcribed sessions used for supplemental support.
The bill would establish penalties for breaking the law, up to a $50,000 fine per violation.
Religious counseling, peer support, self-help materials, and educational resources could be excluded from the scope of the law.
Oversight of AI in Therapy
According to a memo from Sen. Gonzalez, general AI use is dangerous for mental health care.
She cited research from the Stanford University Institute for Human-Centered AI showing that AI chatbots sometimes stigmatize certain mental health conditions and “enable dangerous behavior like suicidal ideation.”
Gambling addiction has enormously high rates of suicidal ideation.
“AI should not be used to supplant professional judgment in interpreting client interactions, providing therapeutic strategies, offering emotional support, directly collaborating with clients, or offering behavioral feedback,” said the legislative memo.
In Gambling Harm’s view, AI platforms also recklessly promote the problematic concept of “responsible gambling,” including the misleading strategy of budgets for sports betting.
New York’s AI Gambling Policy Efforts
Sen. Gonzalez is also the sponsor of separate AI betting legislation that would address push notifications from sports betting apps.
In a July 2025 interview with Gambling Harm, Gonzalez said her proposal would “regulate use cases” of AI in sports betting rather than impose a ban on the technology.
The proposal is called the Regulating Addictive Notifications Act.
She told Gambling Harm that New York is a “laboratory” for AI regulation. Her Oversight of Technology in Mental Health Care Act is part of the growing trend.
According to the legislative memo, Illinois passed a similar bill regulating AI in mental health treatment. The state is also home to legislation to ban AI use in creating betting products.
The federal SAFE Bet Act also proposes a prohibition on AI to boost gambler losses.
Alongside the Gonzalez bills, New York lawmakers have looked at requiring insurance companies to cover problem gambling.
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