Category Archives: Fantasy Sports

Billions in Illegal Gambling on Super Bowl comes with Serious Consequences for Many

Casino Watch Focus has reported on the significant amount of gambling on the Super Bowl each year, and each year the impact seems to grow. This year the amount of total gambling on the Super Bowl is estimated to be around $4.7 million. An online source breaks that number down:

Americans will bet $4.7 billion on Super Bowl 51 between the New England Patriots and the Atlanta Falcons, according to an estimate released Tuesday by the casino industry’s top lobbying group on Capitol Hill. That would 11 percent more than what was wagered on last year’s Super Bowl.

According to the American Gaming Association, only $132 million of the $4.7 billion will be done legally through Nevada’s casino industry. The 1992 Professional and Amateur Sports Protection Act banned traditional sports betting outside of the Silver State.

Many think gambling on the Super Bowl is harmless fun, and for some, who do it legally, it could be that simple. However, the consequences for others can be extreme.   A Fox News affiliate has reported that Super Bowl night is not only the biggest night for gamblers, but it also sees the most suicides as well.  For those that don’t suffer the ultimate fate, they can still lose enough to cause irreparable harm to their finances and family. Fox Now online explains: 

“Super Bowl is probably one of the biggest gambling days of the year,” said Gambling Addiction Counselor, Jim Harrison [a gambling counselor in Milwaukee.] He says the wagers placed on the Super Bowl are often not taken as seriously and can be seen as harmless and fun. “In reality it is betting, it is gambling,” said Harrison. Those compulsive gamblers see it as a day to make up for other sports losses this season.

Harrison says it’s not harmless at all for those with an addiction — betting is done with bookies and online and it could bring losses. “If it causes family problems, certainly financial problems,” said Harrison. “I’ve had clients who have literally lost over $300,000 gambling,” said Harrison. The Super Bowl can bring losses to those betting on it all, and it can be tempting to those dealing with gambling addition.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

Advertisements

Florida Legislator Attempts to Exempt Daily Fantasy Sports Industry from Gambling Regulations

Casino Watch Focus has reported on the ongoing path of newest gambling fad, daily fantasy sports (DFS). Many jurisdictions are viewing these daily contests as simple gambling given there isn’t the same skill level involved in playing with one drafted fantasy team over the course of a season and instead players pick a new team of players, most often with the ability to pick the exact same player, each day. Others have tried to pass legislation to call them games of skill and thus not gambling. Florida is a key jurisdiction given the major companies involved, DraftKings and FanDuel have corporate offices located in the state. Florida has sought to address the issue legislatively over the past two years, but with no true outcome. This session seems to be no different as a new Bill has been introduced that seeks to make DFS legal by exempting them from regulation. An online gambling site reports:

Florida state Rep. Jason Brodeur recently filed HB149, which would declare daily fantasy sports is a game of skill, not luck, thereby removing it from oversight by the Department of Business and Professional Regulation, which oversees parimutuels, poker, slots and other gambling.

Last year state Senator Joe Negron and state Reps. Matt Gaetz and Ritch Workman filed similar bills. The House Business & Professional Subcommittee passed Gaetz’s and Workman’s bill to allow and regulate DFS in Florida, but it died because lawmakers considered blackjack and fantasy sports to be gambling expansions.

Florida gaming lawyer Daniel Wallach pointed out, “In Florida it is illegal to bet or wager on both games of chance and contests of skill. So calling it a ‘contest of skill’ does not insulate the games under Florida law because wagering in those types of contests is also illegal. In my view, DFS would probably be considered ‘gambling’ under Florida’s broad test.” As a result, Wallach said, Brodeur’s bill is “a straight-up decriminalization measure that comes at a potentially heavy cost for consumers, with no regulatory oversight, and, even worse, no regulations unlike in other states.”

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


DraftKings Sued for $4 million for Non-Payment of Advertising Deal

Casino Watch Focus has reported on the many woes of the Daily Fantasy Sports (DFS) industry. They have come under fire for being sports gambling and various legislation has been passed on a state by state basis. Some have banned it, others have regulated it. They were scrutinized for insider-trading type scandals and hacking vulnerability. They have been exposed for their role in being used by the NFL to market to kids and the risk they put on corporations that allow fantasy sports in the workplace. Now one of the two major daily fantasy sports companies, DraftKings, is being sued for over $4 million for not paying their bills and backing out of contractual agreements. Forbes Online explains:

DraftKings has been sued in the U.S. District Court for the Southern District of New York, with the plaintiffs seeking no less than $4.16 million in damages. The stated damages include $575,000 in alleged unpaid invoices as well as benefits that DraftKings is claimed to have received from an agreement that DraftKings entered into.

On April 4, 2016, after four invoices were past due, the plaintiffs allegedly contacted Robins via text and Robins responded ensuring that payments would be made. That same day, DraftKings Chief Financial Officer Janet Holian asked the plaintiffs to stop producing the DraftKings-related programming. A week later, Holian said that DraftKings would not be making any further payments.

The plaintiffs claim that they are entitled to additional damages based on DraftKings’ promise that it would execute a contract reflecting the totality of the deal terms as well as the expenses that the plaintiffs incurred (well over $1 million, per the Complaint) due to DraftKings’ promises. Additionally, the plaintiffs allege that DraftKings was enriched at the plaintiffs’ expense. 

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


Fantasy Football Costs Employers a Shocking $17 Billion and Puts Companies at Legal Risk

As America enters into another year of the National Football League, gambling is set to take center stage yet again. Casino Watch Focus has reported on the emergency of daily fantasy sports as the newest form of sports gambling. Some jurisdictions have appropriately labeled it gambling and either outlawed its practice or regulated it accordingly. Other states have yet to make a formal proclamation about this form of gambling. But as with other forms of sports gambling, like NCAA March Madness  or the Super Bowl, the impact from such gambling will be felt in the workplace at home. Fortune Magazine has reported on the staggering amount of money fantasy football will cost employers, the results are nothing short of shocking:

According to Chicago-based employment research firm Challenger, Gray & Christmas, the sheer number of fully-employed fantasy football freaks could cost U.S. employers close to a whopping $17 billion (with a “b”) in lost productivity. That total eclipses the amount of total revenue the NFL took in last year, which was a mere $13 billion or so.

These numbers are hard to crunch, acknowledges Challenger, which came to this sum using the estimated 57.4 million people in the U.S. and Canada (ground zero for the NFL fandom) who play fantasy football, according to the Fantasy Sports Trade Association. The FTSA also estimates that 67% of those players (38.5 million people), work full time. And using U.S. Bureau of Labor Statistics data, the company estimated those players earn roughly $25.69 per hour, on average.

If you assume that to be the case, each hour spent poring over matchups and obsessing over results costs employers in aggregate $898.1 million in lost or unproductive wages. And assuming each player spends an hour of work time each week fiddling with lineups every week of the regular season, the total would come to $16.8 billion. 

Not all of this lost productivity is without employee consent as some workplaces even allow office pools and fantasy football leagues in which even senior members of leadership participate. However, just because some companies are aware of such activities, it doesn’t lessen the legal consequences when the gambling is deemed illegal. The Miami Herald explains:

Office pools and fantasy leagues remain a great way to bring positivity and fun to the workplace. Used properly, fantasy leagues can be a valuable team-building exercise, similar to an office March Madness pool during the NCAA tournament. Employers must be cognizant of issues related to gambling and increased work distractions, however. By creating an office pool or fantasy league, employers must be aware that creating such a pool or league may inadvertently encourage employees to spend part of their work day focused on their fantasy teams rather than work-related activities.

Employers must always be mindful of the potential impact on productivity in the workplace and ensure that any office pools or fantasy leagues are not out of bounds of the law. In order to ensure that employers are operating within legal boundaries, they should consult with an employment attorney.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


Daily Fantasy Sports Face Security Issues from Hackers and Insider Trading Scandals

Casino Watch Focus has reported on the ongoing saga of America’s newest form of gambling, Daily Fantasy Sports (DFS). Many people participate when they see advertisements for DraftKings or FanDuel without realizing it could be an illegal form of gambling. Others may know, but assume the risk is low and play because it seems so prevalent. Few, however, consider the risks beyond its legality and assume it’s a safe environment to pay and collect money. Unfortunately, that is hardly the case. Casino Watch Focus has already reported on one insider type trading incident as a DraftKings employee wont $350K at its rival FanDuel’s site. As on employee of one site, they have access to betting trends and outcomes and can use the information unfairly when “competing” against others. Now, its appears another type case has manifested itself. Deadspin explains the details:

Stefon Diggs had a fantastic game last night , torching the Green Bay Packers and helping his team win in the first game at their new stadium. His nine catches and 182 yards with a touchdown also played a key role in securing Al Zeidenfeld first place in DraftKings’ biggest contest of the weekend, the NFL $5M Fantasy Football Millionaire. That’s a $1 million prize, even before his other Week 2 entries.

Zeidenfeld is also a regular DFS contributor to ESPN and, in his words, a “sponsored professional Daily Fantasy Sports player at DraftKings.com. On air personality and content provider for DraftKingsTV and Brand Ambassador/endorser.” It’s at least curious that the winner of DraftKings’ flagship contest is someone paid to give advice to his ostensible competitors, but a Draftkings contractor raking in a big prize is an unwelcome callback to last year’s controversies.

But even if such cases don’t seem like the norm and something players consider when playing these games, then surely the protection of their personal and financial information should be? Cybersecurity experts are warning of the large target such DFS communities pose. And the threat isn’t limited to hackers stealing financial information outright either, there are legitimate concerns or them manipulating the data used to determine winners as well. An online tech source explains:

A growing chorus of cybersecurity experts is warning that fantasy sports websites represent a prime target for hackers. The volume and sensitivity of data on these sites is significant. And many have failed to put expansive data protection measures into place.

The daily fantasy industry netted $290.7 million in revenue just in the US in 2015. DraftKings accounted for $174 million of that revenue and FanDuel for $106 million. It is predicted that growing competition in the market will push the total revenue for daily fantasy sports into the billions in the near future.

In addition to the money itself, these sites store the personal and financial data of million of users. These sites may not rank in the Top 10 of consumer-facing websites, but their appeal as targets for hackers is significant.

Theft is not the only concern. Experts have also warned that hackers could manipulate the data used to determine winners and losers to award legitimate prizes to fraudulent users. The explosion in traffic these sites face on the Sunday morning before most football games also puts them at risk of denial-of-service and zero day attacks.

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


New York Fantasy Sports Legislation Might Be Subject to Lawsuits Seeking to Stop Expanded Sports Gambling

Casino Watch Focus has reported on the ongoing developments in the Daily Fantasy Sports (DFS) industry. These daily fantasy games are essentially taking the skill based game of fantasy sports that typically lasts and entire season and boiling it down to a daily gambling activity which lacks the same skill based approach as typical fantasy games. The industry was called out for being a very obvious form of illegal sports gambling at both the state and national level. Feeling the pressure, the industry has at temped to self regulate to have the appearance of safeguards for players and they have spend tons of time and money in lobbying efforts to legalize their gambling product. Each state has, however, chosen to regulate the industry in a different way, and some have defined DFS as games of skill, thus making it immune to gambling laws. One of the newest states to enter the debate is New York, and they may be facing lawsuits. The Buffalo News reports: 

A national anti-gambling group may sue to try to reverse a new law legalizing daily fantasy sports contests in New York State.

“We believe in improving the lives of New Yorkers, and part of that mission is to repeal the state’s predatory gambling policies, and litigation is part of that effort,” said Les Bernal, national director of the Washington, D.C.–based Stop Predatory Gambling.

Critics of the new law, signed by Gov. Andrew M. Cuomo two weeks ago, say the Legislature needed to go through a lengthy constitutional amendment process to legalize a new form of gambling. Instead, the bill’s sponsors relied on a statutory change that declared the fantasy sports contests to be “games of skill” instead of illegal games of chance.

The anti-gambling group Stop Predatory Gambling, isn’t the only organization that has an interest is stopping this form of gambling. There have been talks of local casino companies bringing suit. Additionally, the new legislation may very well violate the state’s exclusivity agreements with tribal groups in New York. Stop Predatory Gambling has been clear, however, that they wont partner with such groups and they have their own, more altruistic reasons for trying to protect the citizens of New York. The Buffalo News continues:

Where the money to fund the litigation by the national anti-gambling group would come from is not certain, but Bernal said his group would not partner, directly or indirectly, with any casino companies that also opposed the June legislation.

Bernal pointed to a May Siena College poll that found 45 percent of New Yorkers opposed daily fantasy sports and 37 percent supported it.

“There is no single act of New York State government that creates more inequality of opportunity than its sponsorship of predatory gambling,” Bernal said. “And now what state government is trying to do is force predatory gambling into every home and smart phone in the state as a result of a push by very powerful gambling interests.” 

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION


UPDATE: NFL to Cease Fantasy Football Marketing Efforts to Minors

Casino Watch Focus has reported on the unfortunate direction the NFL took regarding fantasy sports. Several non-profit organizations, including The National Council on Problem Gambling and the Campaign for a Commerical-Free Childhood, reached out to the NFL to express legitimate concerns over their marketing practices. In a letter to the Commissioner Roger Goodell, they outlined how them directly and aggressively seeking kids to participate on fantasy sports games like “NFL Rush” was promoting a culture of gambling. These games offered prizes that, according to the letter, “may encourage children to spend excessive amounts of time trying to win these prizes, thus planting the seeds of addiction.” These corruption allegations were heard by the NFL and they have stated they plan significant changes. An online source explains:  

The NFL confirmed Wednesday it has informed several advocacy groups that it will make significant changes to the game. The school curriculum based on the game has been discontinued and the league has promised it will not promote fantasy sports in schools in the future.

“We are pleased that the NFL has agreed to make these changes, and young children will no longer have a financial stake in the outcome of its games,” said Josh Golin, executive director of the Campaign for a Commercial-Free Childhood. “It is also good news for parents that the league will no longer enlist teachers and schools in an effort to get children into the habit of playing fantasy sports.”

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION