New York State Attorney General Eric Schneiderman sent a cease-and-desist order this week to the popular daily fantasy sports sites DraftKings and FanDuel, demanding they stop taking bets from New Yorkers.
“It is clear that DraftKings and FanDuel are the leaders of a massive, multibillion-dollar scheme intended to evade the law and fleece sports fans across the country,” Schneiderman said. “Today we have sent a clear message: not in New York, and not on my watch.”
The multi-billion dollar industry, whose risks ThinkProgress reported on earlier this year, is pushing back against the order, arguing that they should continue to be less regulated than all other forms of gambling because their participants can win money based on skill at choosing winning athletes. If this case ends up in court, which is likely, the state of New York will have to prove that it’s more a game of chance than talent.
As one former addict of the sites told ThinkProgress, “There were multiple days when I would have a player get injured early on in the game. How can they claim knowing that guy was gonna get injured was skill? There is a small amount of skill involved, but it doesn’t outweigh the gamble on a player’s health and performances. There is no more skill involved in it than just betting games straight up.”
The New York Attorney General’s office began more closely investigating the online sports betting world after a scandal in October in which an employee of the site DraftKings accessed confidential insider data and used it to win hundreds of thousands of dollars at the rival site FanDuel.
Schneiderman also scrutinized the companies’ advertisements online and on popular TV networks like ESPN, saying this week that they “seriously mislead New York citizens about their prospects of winning.”
Other states, including Florida and Nevada, are also taking steps to crack down on this form of betting. And some federal lawmakers say the essentially unregulated industry is entirely illegal.