DraftKings, FanDuel Are Illegal Gambling Sites: NY AG

In a potentially huge blow to the daily fantasy sports industry, New York Attorney General Eric Schneiderman Tuesday told the websites DraftKings and FanDuel to stop taking bets from New York residents because the operations are considered to be illegal gambling sites, according to The New York Times.

DraftKings and FanDuel are the two largest daily fantasy sports sites in the country, and their advertising is seen and heard countless times during sporting and other events on television and radio. Both have forged deals with sports leagues and broadcasters, like ESPN, as they stand atop the multibillion-dollar daily fantasy sports industry.

“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. Today we have sent a clear message: not in New York, and not on my watch,” Schneiderman told the Times. FanDue is based in New York, and DraftKings in Massachusetts.

Schneiderman launched an investigation into the two businesses several weeks ago, but both companies contend that their games are skill-based and not chance or luck-based. On both sites, participants create teams using real sports players and compete against other participants by using the game statistics of the pro athletes. Bettors on both sites can play for prize money or bragging rights.

Both companies could challenge Schneiderman’s opinion by filing a lawsuit.

“We’re disappointed he hasn’t taken the time to meet with us or ask any questions about our business model before his opinion,” DraftKings spokesperson Sabrina Macias told the Times, referring to Schneiderman. His office maintains members of his staff met with representatives from the company numerous times.

FanDuel added in a statement, “Fantasy sports is a game of skill and legal under New York state law. This is a politician telling hundreds of thousands of New Yorkers they are not allowed to play a game they love and share with friends, family, co-workers and players across the country.”

Click here to read the full story on The New York Times website.

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