FanDuel and DraftKings, two of the biggest names in online fantasy sports and the targets of an investigation, responded to calls for greater transparency by banning their own employees from playing on their kind of websites.
New York Attorney General Eric T. Schneiderman has opened an investigation into both websites, reported ESPN
Controversy in the largely unregulated world of fantasy sports exploded after news that one of DraftKings employees admitted releasing data before the start of Week 3 of the NFL regular season, said The New York Times
The DraftKings employee, a midlevel content manager, won $350,000 on FanDuel the same week.
FanDuel and DraftKings have always forbidden employees from playing on their own websites, noted ESPN
, and FanDuel announced it has permanently banned employees from playing on other fantasy sites, a day after the two sites temporarily imposed a temporary ban.
DraftKings refuted a charge that its employee, Ethan Haskell, had internal data before securing his lineup on FanDuel, allowing him to win the $350,000, according to ESPN. Jason Robins, DraftKings' chief executive, said he has hired a law firm to handle an internal audit.
FanDuel spokesperson Justine Sacco said DraftKings' employees have won 0.3 percent of the prize money the company has awarded in its history.
Daniel Wallach, a sports and gaming law expert, told USA Today
the controversy could be the catalyst for lawmakers to step in.
"What happened in over the last few days is probably the single greatest engine towards regulation that we’re going to have," said Wallach.
In the letters sent to both DraftKings and FanDuel, Schneiderman asked the companies to provide names and titles of employees who compile player data, set roster values, deal with ownership percentages for pending and historical contests and aggregate the success of players who play on their sites.
Current federal law views fantasy sports as a reflection of skill and knowledge instead of pure luck of traditional gambling, wrote USA Today. Fans have a chance to capture daily cash winnings based on the statistical performance of athletes in games that day or week.
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