DFS scandal of the day

[mjl]

A major scandal is erupting in the multibillion dollar industry of fantasy sports, the online and unregulated business in which players assemble their fantasy teams with real athletes. On Monday, the two major fantasy companies were forced to release statements defending their businesses’ integrity after what amounted to allegations of insider trading, that employees were placing bets on information not available to the public.

Last week, a DraftKings employee admitted to inadvertently releasing data before the start of the third week of N.F.L. games, a move akin to insider trading in the stock market. The employee — a midlevel content manager — won $350,000 at rival site FanDuel that same week.

http://www.nytimes.com/2015/10/06/sports/fanduel-draftkings-fantasy-employees-bet-rivals.html?emc=edit_na_20151005&nlid=13116605&ref=headline&_r=2

[revo]

Jeff Mans was discussing this on his show today. I gotta read up on this.

[Hornsby]

This shit is going to be gone in 5 years...it's like the wild west out there. It's clearly gambling, and it's totally unregulated. It's just a horrible idea...

[Judge Jude]

NJ lost by a 2-1 count in 3rd Circuit Court of Appeals in August in bid to allow state casinos and racetracks to run their own private sports betting bookmaking operations - no state oversight, since they lost on that version in 2013. looks like full 3rd Circuit this month will agree to hear case, which is extremely rare. but judge who wrote majority opinion 1st time against NJ now is the dissenter in the second version....

[madducks]

This shit is going to be gone in 5 years...it's like the wild west out there. It's clearly gambling, and it's totally unregulated. It's just a horrible idea...

Agree with this. I just hope it doesn't drag down traditional fantasy sports with it. Because you know the daily guys are going to try to defend themselves by saying the roto guys are gambling too. Even though it's apples and oranges, the feds never like it when a multi million dollar industry doesn't give them a large piece of the pie.

[revo]

Legal Sports Report is also reporting that "an industry insider who wished to remain anonymous told LSR that a significant number of the whales at the top DFS sites are employees – often executives – of other sites.”

It seems like this "insider trading" scandal will certainly do some damage.

[Sour Masher]

So, are they doing this in breach of contract, or are they actually allowed to "play"/gamble on rival sites? The latter seems ludicrous to me.

[Trautdiggity]

So, are they doing this in breach of contract, or are they actually allowed to "play"/gamble on rival sites? The latter seems ludicrous to me.

From the sounds of everything I'm hearing today both of the big companies acknowledge that employees are barred from playing on their site but that they are known to be players on rival sites and that is not frowned upon nonetheless forbidden.

[swampdragon]

there are so many, many more problems likely - that is likely the least of the problems

Who regulates these gambling sites? How do we know what gets paid out? Is the betting system timed so that it cant be hacked? Who sees the exact odds and bets by people?

There is no one not from the company watching this - the player has no idea what is really happening behind the curtain

you are gambling your money against an invisible competitor tallied by an invisible source

[umjewman]

there are so many, many more problems likely - that is likely the least of the problems

Who regulates these gambling sites? How do we know what gets paid out? Is the betting system timed so that it cant be hacked? Who sees the exact odds and bets by people?

There is no one not from the company watching this - the player has no idea what is really happening behind the curtain

you are gambling your money against an invisible competitor tallied by an invisible source

Yeah, but according to that one guy in the commercial, he deposited $2,500 and made $1,000,000. That's good enough for me!

[revo]

there are so many, many more problems likely - that is likely the least of the problems

Who regulates these gambling sites? How do we know what gets paid out? Is the betting system timed so that it cant be hacked? Who sees the exact odds and bets by people?

There is no one not from the company watching this - the player has no idea what is really happening behind the curtain

you are gambling your money against an invisible competitor tallied by an invisible source

There aren't "bets or odds," but rather you play against other players. If you enter a contest, you can see everyone's lineup as soon as the games start. The issue here is apparently employees for these companies are allowed to play on other sites, and are getting insider info by seeing data on player usage. Having that info is crucial, especially in large tourneys, where player usage is a key factor in selecting lineups. The employee in question seems to have a knack at finishing high in large tourneys.

[Trautdiggity]

Yeah, but according to that one guy in the commercial, he deposited $2,500 and made $1,000,000. That's good enough for me!

Oh yeah that's a FanDuel commercial. That guy is the CTO of Draft Kings

[revo]

This shit is escalating quickly -- the AGs of more than one state are looking into regulating DFS. It amazes me that this industry, growing by leaps and bounds, allowed rank and file employees & execs to play DFS for only their own benefit. Some mid-level shlub may be bringing down the entire industry!

[Judge Jude]

I don't think that's the case - seems more likely that DraftKings hired the sharks to run things, and to mix metaphors the foxes in the henhouses... well, we don't even know that yet, really. The optics are brutal and it's a pretty unregulated industry, so best for all of us not to get boxed in. the ground keeps shifting....

[Erik]

I certainly don't expect our do-nothing Congress to do anything, especially since both of these outfits are backed by Wall Street money. A crackdown is most likely to happen at the state level.