The watchdogs of the legal sports betting world are well aware of the debate around fantasy contests that resemble player prop parlays, even if they have not joined some of their peers in cracking down on such offerings.
“There are eyes on those operators who may be crossing over into the sports-betting world,” Massachusetts Gaming Commission chair Cathy Judd-Stein said on Monday during a panel at the Global Gaming Expo (G2E) conference in Las Vegas.
Regulators in states such as Michigan, Ohio, and Florida have recently taken action to halt pick ‘em-style fantasy sports contests, wherein customers typically choose two or more outcomes, such as players going over a certain point total, in return for a payout.
Pick ‘em operators, however, have pushed back and argued they are operating legally. Moreover, they say the crackdown is driven by daily fantasy and sports betting giants such as DraftKings and FanDuel.
The situation continues to boil, and additional action by operators and regulators seems likely. On Monday, during the first day of panels at G2E, a handful of gaming watchdogs made it clear the issue is on their radar, and some made it evident they will follow state law on the subject to the letter.
“In Nevada, it’s gaming,” Nevada Gaming Control Board chair Kirk Hendrick said.
Hypothetically speaking, of course
New Jersey Division of Gaming Enforcement director David Rebuck noted his state has a law that allows fantasy sports to be deemed a skill-based game and regulated by their Division of Consumer Affairs.
“I'm very cognizant of the pick ‘em, prize-pool games now that are very similar to parlay wagers, which are clearly sports wagering in the state of New Jersey,” Rebuck said.
But Rebuck added that no one offers these types of games in New Jersey, either through the Division of Consumer Affairs or the DGE, which they could do if they were licensed sports-wagering operators. For now, though, the former remains just a “hypothetical,” he said, because no one has.
“It's difficult to address a hypothetical,” said Marcus Fruchter, the administrator of the Illinois Gaming Board. “I would just make the observation that whatever someone might want to call something if it operates like sports wagering then it probably is sports wagering.”
Calling it how the law sees it
Companies such as PrizePicks and Underdog operate pick ’em contests in states such as Massachusetts and Illinois, although that may change if the mood changes with regulators.
In other states, however, local authorities have made it apparent those types of products are not welcome, including those with online sports betting sites regulated and taxed by local authorities.
Other states still have recently begun taking regulatory and legal action against fantasy operators over their activities. Michigan, for instance, has rules set to take effect this month that would ban prop-style fantasy contests.
“The Michigan Gaming Control Board sees it as the law sees it,” said Henry Williams, executive director of the Michigan Gaming Control Board, during another G2E panel. “The law sees it as illegal.”
Williams was on a panel with Louis Trombetta, executive director of the Florida Gaming Control Commission, who recently sent cease-and-desist letters to Betr, PrizePicks, and Underdog over their alleged fantasy activities in the state. Trombetta declined to say much on Monday beyond what’s already been reported.
“We're looking into it,” he said.
