“It is absolutely akin to insider trading”, Daniel Wallach, a sports and gambling lawyer, told the New York Times.
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The industry, projected to bring in $14 billion in revenue by 2020, has been under scrutiny after DraftKings employee Ethan Haskell admitted to “inadvertently” releasing sensitive data about a large tournament in the same week that he reportedly won $350,000 on DraftKings’ rival site FanDuel.
“This clearly demonstrates that this employee could not possibly have used the information in question to make decisions about his FanDuel lineup”, the statement continued.
The two companies said they had investigated Haskell and cleared him of wrongdoing.
This piles on to the already mounting concern over daily fantasy sites, not only for instances of this nature but the sheer legality of said sites. The union that represents National Football League players about a week ago signed a deal with DraftKings that allows its members to appear in the company’s ads.
Attorney General Eric Schneiderman sent letters to both companies on Tuesday asking for information related to the controversy. However, it was something its company had addressed since the beginning, through working on charters with the Fantasy Sports Trade Association and implementing strict punishments for anyone who was caught misusing information, including termination.
Both DraftKings and FanDuel say they have now banned employees from playing fantasy games for money after claims surfaced that workers used insider information to place their own bets.
Major League Baseball, which owns a stake in DraftKings, doesn’t allow its players and coaches to participate in fantasy games for money. “That said, the incident has raised questions about the trust-based relationship we have with our players so just relying on what we know right now isn’t enough”.
New York’s attorney general is launching an inquiry into two daily fantasy sports sites, DraftKings and FanDuel, that are at the center of a growing scandal, according to his office.
The employee stands accused of using data not available to the general public – such as information on which players were the most popular fantasy picks – to help win big on other sites. Darren Rovell, from ESPN’s “Outside the Lines”, reported that a FanDuel spokesperson had provided data on how much money DraftKings employees had won at FanDuel.
ESPN said Tuesday that it’s pulling on-air segments sponsored by one of the companies implicated in a possible scandal that’s rocked the billion dollar world of fantasy sports.
FanDuel has now permanently banned employees from playing in daily fantasy leagues and more changes continue to come down.
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Peredes, a professional poker player, said he’s a fan of the daily fantasy sites, but hasn’t played, and less likely to join given the lack of oversight. The sites say payouts can reach $2 million.
