FanDuel bans employees from playing daily fantasy sports for money

A scandal over the alleged misuse of inside information in the daily fantasy sports industry has now caught the eye of state regulators.

Two of the most popular sites, FanDuel and Draft Kinds, are under fire after an employee tweeted data that could be used to gain an advantage in drafting fantasy teams. “We will also require all customers to confirm that they are not an employee of any other third party fantasy site, and if they are, they will not be allowed to access our site”. The reverse is also true.

In the past decade, fantasy sports websites in the United States have soared, with the numbers of participants skyrocketing from 12.6 million in 2005 to an estimated 56.8 million in 2015.

But on Tuesday, a DraftKings spokesman said that the $350,000 victor did not receive the aggregated lineup information until 40 minutes after the first kickoffs on the day in question – making it impossible for him to enter a lineup on another site that made use of this information. Controversy over the premature release of information by an employee at DraftKings, one of the two big firms, continued Tuesday as there were calls from Capitol Hill for greater oversight of the industry.

Earlier today, on Outside the Lines, Darren Rovell reported that according to a FanDuel spokesperson, DraftKings employees have won 0.3% of all money won at FanDuel.

Regardless if insider trading occurred or not, Wallach said the episode highlighted the lack of safeguards in place and had suggested during last week’s Global Gaming Expo in Las Vegas that the industry could be a possible haven for money laundering. A few have said he is the player pricing expert at FanDuel.

The statements did little to quell questions from fantasy sports players on message boards dedicated to the daily fantasy sports industry and observers who have said the industry was traveling head-long into being regulated. Access to data was limited only to employees who needed it to do their jobs. Right now, there are no real external rules about that.

That statement despite the fact that Major League Baseball theoretically did its due diligence in deciding to invest in DraftKings. “Employees with access to this data are rigorously monitored by internal fraud control teams, and we have no evidence that anyone has misused it”. “We have reached out and discussed this matter with them”.

ESPN on Tuesday removed sponsored content for DraftKings from its programs on the heels of allegations of insider trading within the fantasy sports company. He said the casino industry sees fantasy sports as a potential partner “to grow both of our businesses”.

Daily fantasy has its roots in informal fantasy games that began years ago with groups of fans playing against one another for fun over the course of a season. It’s all stuff veteran gamblers know, which generally could be filed under the wisdom of, “If you don’t know who the sucker is, you are the sucker”.

“We believe that fantasy sports should be legal and subject to appropriate consumer and competitive protections”, Menendez and Pallone wrote.

Make the big financial kill, then answer questions if necessary. “It isn’t that different from the stock market”.

I’m not against adults playing games with entry fees hoping to win a lot of money; I do wish we just got on with it and called that gambling.