Daily Fantasy Sports Regulation

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It seems that over the past 2-3 weeks there has been a ton of negative press for DFS. Whether it be the baseless personal attacks on Ethan Haskell, Nevada coming in with a very conveniently timed banning of DFS in the state, StarsDraft seemingly sabotaging their DFS stake in the industry (or being so cautious as to pull out of states that haven't shown to display any public negativity towards DFS), or Marjor Media outlets running with scandalous claims that had no merit, DFS has taken a beating.

It seems like the dust is settling and I'm hopeful that cooler heads will prevail to bring thoughtful and helpful regulation to DFS. In my personal opinion, DFS is very different than Poker when it comes to government financial concern. In Poker, there were clearly laws being broken with wire fraud and the US government wasn't able to get a grip on the tax situation. Most of the DFS companies are either based in or have Headquarters in the US. These companies are able to be held accountable by US laws (can't say the same for offshore casinos) and DFS companies ensure 1099 forms are filed for players and in turn are doing as much as they can to ensure income taxes are paid on a federal and state level. It gets trickier if DFS were categorized as Gambling, which would complicate the tax code on a state level.

With that said, I created this thread so the DFC community can keep up with the DFS regulation and legislation news. I'll start it off with two news stories:

1. California legislator brought forth a Bill prior to the DraftKings Data Leak - http://wthitv.com/2015/10/27/rep-morrison-to-sponsor-bill-to-regulate-daily-fantasy-sports-sites/

2. NBA's Adam Silver supports regulation and makes a clear distinction on the leagues thoughts of legality - http://espn.go.com/espn/otl/story/_/id/13941819/nba-commissioner-adam-silver-favor-regulation-daily-fantasy-operators

3. Illinois introduces a Bill to Regulate DFS - http://www.wsj.com/articles/illinois-to-introduce-bill-to-regulate-daily-fantasy-sports-1445902199

8 years ago

Commissioners of MLB, NFL & NBA communicating the same message: They don't consider daily fantasy games gambling, but games need regulation - http://espn.go.com/chalk/story/_/id/13983597/commishes-say-fantasy-not-gambling-needs-regulation

8 years ago

Not what I wanted to post today, but nonetheless - http://www.nytimes.com/2015/11/11/sports/football/draftkings-fanduel-new-york-attorney-general-tells-fantasy-sites-to-stop-taking-bets-in-new-york.html?_r=0

The terminology the AG used is a bit ridiculous in my mind. He's obviously looking for attention and wants to run for some political office. Will be interesting to see how DraftKings & FanDuel react legally if at all.

8 years ago

Looks like DraftKings isn't going to take this laying down, which is good to see - http://espn.go.com/chalk/story/_/id/14100780/newyork-attorney-general-declares-daily-fantasy-sports-gambling

8 years ago

Looks like FanDuel is not pulling out of NY either for the time being. This is a note from FD.

8 years ago

Not sure if everyone has seen this, but the NY AG has given a cease &desist order to both DK and Fanduel. As of now, I was able to enter alineup for Thursday so it seems like they are ignoring him, I amguessing because the federal law trumps the state law. But, it isstill bad for the community of players in general. I live in CT andwork in NY, but I travel between the states often. So if I set mylineups in CT and they shut down NY, that would mean I wouldn't beable to make any last minute changes if I went to go watch the gamesin NY. (Probably better for my game anyway, unless its a Q to Dsituation). Anybody have any idea what the outcome of this is going tobe? Seems like the state is climbing an uphill battle against federallaw, especially since they allow sanctioned lottos, and NYC even has aCasino in Queens I believe now.

8 years ago

https://www.reddit.com/r/dfsports/comments/3sf3sn/the_ny_ag_schneiderman_is_a_corrupt_casino_schill/

This says a lot about the type of person and politician he is.

8 years ago

@lox81 - this week you are good according to DK & FD. Check back next week to see if anything changes. If they did block NY players, you wouldn't be able to update your lineups (doesn't matter on FD as they have no late swap) as they would track your location and block based on that.

In terms of the outcome, not sure anyone knows, but it looks like DK & FD have a few days to respond to the C&D. They can agree and pull out or disagree and then it would likely go into the court system via appeals, etc.

8 years ago

Good to see - http://espn.go.com/chalk/story/_/id/14107211/fanduel-draftkings-fight-newyork-attorney-general-decision-daily-fantasy-sports-illegal-gambling

8 years ago

@Sam, yeah, but if they do block it, and I stay in CT, I should be fine, right? Problem is, I was on the train the other night, we had crossed into CT already, and the petition to sign for the AG's nonsense still came up on my phone. So I don't know if they simply just go by where your location is. Keep in mind, my phone could be pulling from data towers in NY when I am not on a wireless connection. It could get tricky. Honestly I don't think they are going to shut down anyway, but you never know. Federal law trumps state law and right now under Federal law, DFS is legal. I almost wish they didn't have the advertising blitz campaign they did because it really put it into the spotlight. Anyway, lets go Jets tonight in the Rex Bowl.

8 years ago

Yeah, I hear you. They didn't take the best approach on a number of things.

The issue with geotargeting computer Ip's is that it's not perfect. With phones, I would think they could pinpoint you better using your location via satellite. It shouldn't matter where your wireless tower is actually coming from, it should be your physical location. Could be a number of things with your phone as soon as you cross into CT. What you might want to do is logout and log back in to the app and it could reset to your new location.

I doubt they are that savvy about it at this point, so would expect some growing pains.

8 years ago

Interesting approach - http://www.forbes.com/sites/darrenheitner/2015/11/12/why-has-the-n-y-attorney-general-targeted-daily-fantasy-sports/

Makes me think about what Larry Flynt did a few years back when a few politicians were condemning Bill Clinton for adultery. He put an ad in his magazine for information about these politicians. It turns out a number of them had affairs. I wonder if some real dirt is uncovered on New York Attorney General Eric Schneiderman. The entire approach he took is certainly odd to me and smells of special interests. However, I may be a bit biased.

8 years ago

FanDuel and DraftKings look to be making a stand in NY. Can't help to feel that NY will set the precedent for a number of other states with similar law terminology - http://espn.go.com/chalk/story/_/id/14119916/draftkings-fanduel-sue-newyork-attorney-general-eric-schneiderman

8 years ago

I saw that. Also saw a blur on Twitter from a site that I don't trust that much but is a major site that the DOJ might be coming down on DFS. Will be interesting to see how things shake out.

8 years ago

Maybe things are not looking so good in New York. This just was released by FanDuel.

https://newsroom.fanduel.com/2015/11/13/information-on-deposits-in-new-york/

8 years ago

This what you were speaking to? http://calvinayre.com/2015/11/13/business/draftkings-lawyers-up-cuts-nba-spending/

8 years ago

That is a more in depth article than I saw but yes.

8 years ago

A new story every 15 mins -http://espn.go.com/chalk/story/_/id/14119619/us-department-justice-speculate-legality-daily-fantasy

8 years ago

I think it just goes back to what I talked about a little bit at the beginning of the season. When they passed the online gambling law that exempted fantasy sports, they did it because they didn't want money wired between friends and co-workers for fantasy leagues to be illegal, even if that was over $10K. Obviously some people play in 12 man leagues for $1,000 or more a season, so if winner takes all, its over 10 grand. I don't think they ever expected to see Draft Kings/ Fan Duel explode like they did and for people to literally become professional fantasy sports players where that is their only occupation. Poker is also a game of skill, and obviously is compared to DFS frequently, despite being very different. But for the high volume DFS player, they basically have the same objective as the high volume online poker player, which is to have positive EV which means beating the rake and profiting in the long term using a mix of skill, volume and bankroll. I'm not sure how all this will shake out, but regardless it is hypocritical when more and more states have Casinos, every state has a lottery and people can use the internet to place bets online offshore anyway. I will update you on what happens here in NY but I may only start to sign into DK when I am in CT so I don't have some sort of lock put on my account.

8 years ago

http://bleacherreport.com/articles/2576932-draftkings-fanduel-investigations-latest-details-and-findings

8 years ago
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