DraftKings and FanDuel agree to pay Massachusetts fines
In Massachusetts, daily fantasy sports operators DraftKings and FanDuel have reportedly agreed deals that will see them each hand over $1.3 million to settle allegations that they engaged in unfair and deceptive practices prior to 2016.
According to a report from ESPN, the office of Massachusetts Attorney General Maura Healey began investigating the pair’s operating practices and business models in early-2015 and subsequently determined that some participants were not being adequately protected.
“I am glad to have reached these settlements to address various consumer issues that existed at the early stages of this new industry,” read a Thursday statement from Healey cited by ESPN. “We have since implemented a set of comprehensive regulations that provide consumers with broad-ranging protections and that have served as a model for many other states.”
The Reuters news service reported that the consumer protection regulations subsequently implemented in Massachusetts now prohibit those under the age of 21 from enjoying daily fantasy sports and place restrictions on how the games can be promoted and advertised. The new rules moreover forbid the marketing of paid fantasy sports contests on high school and university campuses while barring professional athletes and agents from taking part in such games.
“We have worked closely with the Massachusetts Attorney General’s Office in its review of fantasy sports including its issuance of the first set of consumer protection regulations for our industry, which we were pleased to comply with since their inception in 2016,” read a statement from FanDuel spokesperson Justine Sacco cited by ESPN.
Healey’s office reportedly told ESPN that DraftKings and FanDuel, which scrapped a proposed merger in July following the filing of a lawsuit by the United States Federal Trade Commission, were now fully compliant with the new Massachusetts regulations. The pair purportedly agreed separate $6 million settlements with New York Attorney General Eric Schneiderman in October in order to resolve accusations that they had previously engaged in false and deceptive advertising practices.
“Over the last two years, the Massachusetts Attorney General’s Office has done an excellent job of working to fully understand DraftKings, our business and the fantasy sports industry,” read a statement from DraftKings spokesperson Tim Parilla cited by ESPN. “That expertise informed the Massachusetts regulations that have now become the national model for common-sense [and] consumer-focused fantasy sports regulations.”