DraftKings Fate Lies With Mass, NY Attorney Generals Amidst Probe, Scandal
Boston-based Daily Fantasy Sports site DraftKings will soon learn its fate as Massachusetts Attorney General Maura Healey determines whether the company can continue operating in the state.
A probe, said to have been initiated by DraftKings itself, has fresh material to mull over that may not bode well for DraftKings following news of potential insider trading within the Daily Fantasy Sports behemoth.
It was revealed to the mainstream media on Monday that an employee of DraftKings with access to insider information won $350,000 in a FanDuel contest. At the time, neither company had a policy regarding its employees playing on competing websites. Once outed, they immediately changed their tune.
Speaker of the House Robert A. DeLeo said any decision to take legislative action will depend on Healey’s review of the company. He did say on Monday that there were real questions as to whether Daily Fantasy Sports constitute gambling and that more stringent regulation could be required. And he points to the company’s aggressive marketing campaign to support this notion.
“I see some of the advertising where the sites talk about (how) you can win so much money on a particular week. I think it’s an issue,” the Winthrop Democrat said. “I think there’s a question, quite frankly.”
For his part, Massachusetts Governor said his administration is not considering regulatory measures against DraftKings, not yet at least.
Late Tuesday, New York State Attorney General Eric T. Schneiderman demanded the names, job titles and descriptions of any employees who aggregate and compile a wide range of data that perhaps could be used to gain a personal advantage — including ownership percentages and pricing algorithms. Both DraftKings and FanDuel, which maintain offices in Manhattan, have until Oct. 15 to respond.
- Tyrone Black, Gambling911.com
