Category Archives: Sports Betting

Congress Introduces Federal Sports Gambling Bills

Casino Watch Focus has reported on the ongoing attempts at legalizing sports betting, with the most common attempts coming from New Jersey. They have attempted, and failed, countless times to get sports betting legalized in New Jersey. Right now the law only allow select destinations like Las Vegas. There most recent attempt was stopped in court and they have appealed that decision to the Supreme Court. The decision to pick up the case or deny it and allow the lower court ruling to stand is being delayed. The Kansas City Star explains: 

Nevada is the only state allowed to offer wagering on single games. Delaware, Montana and Oregon were exempted from the 1992 federal ban and are permitted to offer limited multi-game parlay pools. Congress gave New Jersey a one-time opportunity to become the fifth state before the ban was enacted, but the state failed to pass a sports betting law in the required time window. Republican Gov. Chris Christie has championed New Jersey’s effort in an attempt to use sports gambling revenues to bolster the sagging fortunes of the state’s casino and horse racing industries. The case has a lengthy legal history.

Supporters of legalized sports gambling in New Jersey and several other states were dealt a no-decision of sorts Tuesday when the U.S. Supreme Court delayed a ruling on whether it will take up the states’ challenge to a federal ban. The court invited the solicitor general to file a brief on behalf of the government, which means a decision could take several more months.

As that case sits, New Jersey has decided to not leave the issue to chance and is instead looking to change the federal law that is preventing each of their attempts to legalize sports betting to become law. Two New Jersey Congressmen have introduced legislation to legalize sports betting on a federal level. An online source explains:

Congressmen Frank LoBiondo and Frank Pallone, Jr., both of New Jersey, said last week that their House bills “would ensure a path forward for New Jersey and other states seeking to legalize sports betting, regardless of whether the Supreme Court hears New Jersey’s case.’

Pallone is sponsoring the “NJ BET Act,” which would exempt New Jersey from current federal law. LoBiondo’s bill is called the “Sports Gaming Opportunity Act,” and it would allow all states to enact laws providing for sports betting during a four-year window. Both men in 2015 introduced similar legislation that didn’t go anywhere on Capitol Hill.

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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.

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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.”

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New Jersey Petitions Supreme Court to Allow their Overturned Attempt at Legalizing Sports Betting in NJ

Casino Watch Focus has reported on the ongoing efforts of New Jersey to legalize sports betting in their state. Its been long the case that sports betting has been limited to Las Vegas as they were grandfathered into legislation that prevented states from allowing sports betting. Time & time again New Jersey has attempted a new way to legalize sports betting and time & time again their attempts have been shot down by the courts. There last was a 2014 law that was also halted by the courts. They are taking the final step with this attempt by making an appear to the Supreme Court. The Times Union explains:  

After an initial 2012 law allowing sports gambling in New Jersey was struck down in court, Republican Gov. Chris Christie signed a bill into law in 2014 that repealed prohibitions against sports gambling at casinos and racetracks.

That tactic — repealing prohibitions instead of approving gambling — was seen as a way to get around the federal law by not having sports gambling officially authorized by the state.

But that also met defeat at the hands of a federal judge in New Jersey and a federal appeals court in Philadelphia.

In this week’s brief, the state argued the federal government, while able to regulate citizens directly, may not “require the states to govern by Congress’ instruction.”

Put differently, the appeals court’s ruling invalidating New Jersey’s 2014 law violates the Constitution by “authorizing a federal court injunction mandating that a State reinstate prohibitions it has chosen to repeal,” attorneys representing the state wrote.

The Supreme Court is expected to either pick up the case or reject hearing it, thus affirming the lower courts ruling that the law is illegal, within a month.

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New Jersey Begins a Third and Possibly Reckless Attempt at Legalized Sports Betting

Casino Watch Focus has reported on the many failed attempts by the New Jersey Legislature to legalize sports betting in their state. These attempts have been opposed by all the major sports leagues, including the NFL, NBA and MLB and have been stopped at various legal levels including the Supreme Court. After four years and so many failures, its somewhat surprising that New Jersey legislators are, once again, looking for a way to become the Las Vegas sports betting of the east. An online source explains the path of past failed attempt:  

New Jersey has seen its two previous attempts to allow sports betting fail in the courts. In the first attempt, New Jersey simply passed a law allowing sports betting at casinos and racetracks in 2012. The bill was quickly challenged by the professional sports leagues which cited the federal Professional and Amateur Sports Betting Act of 1992, which prohibits sports betting.

The state challenged PASPA as unconstitutional saying it imposes on state’s rights and unfairly carves out exceptions for states that had some form of sports betting before the ban—most notably Nevada.

In losing appeals for that case, courts said New Jersey may be able to get around the ban by allowing self-regulated sports betting with no state control. That led to the second attempt which would have allowed self-regulated betting at casinos and racetracks.

But courts also struck down that law, saying that by restricting where sports betting would be allowed, the state was still regulating the practice. A federal appeals court upheld that ruling in August, leading to the state’s Supreme Court Challenge. The Supreme Court declined to hear New Jersey’s appeal of its first sports betting law.

The conclusion lawmakers have drawn from these rulings is quite surprising. They believe that the key then, is to pass a law that repeals any and all state regulation pertaining to sports gambling. The implications are not only extreme, but borderline reckless given the law would even allow children the opportunity to place sports bets. Assumptions are being made that after the rule passes new laws to shore up its short comings would be allowed. Its narrow thinking, based on the opinion of one dissenting judge, and those involved are at least seemingly aware that no one actually knows how to do it yet. The online source continues:

The bill makes clear that New Jersey is removing every prohibition or regulation of sports betting—something the federal government acknowledged the state has the power to do, supporters told the /AP/. However, the bill as stands would also mean that children could place bets as well as allow anyone to open their own sports book.

That’s why the state would likely have to add “limited restrictions” afterward, as envisioned by a federal judge who issued a dissenting opinion that sided with New Jersey.

“There have got to be things added to this,” Caputo told the /AP/. “A lot brighter people than me have worked on this and they haven’t found the ultimate answer yet.”

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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. 

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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.

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