Seth Vigdor
After being under the weather for what seemed like forever, I’m back and better than ever. Here’s an update on the ongoing scandal involving the Daily Fantasy Football sites, most notably DraftKings and FanDuel.
In another huge update to the current DFS scandal, the Nevada Gaming Control Board has come out and stated Daily Fantasy Sports sites like DraftKings and FanDuel must cease and desist in the state of Nevada, as the NGCB considers DFS a game or a gambling game. The full statement, is as follows:
“Over the last several months, Nevada Gaming Control Board (Board) staff has analyzed the legality of pay-to-play daily fantasy sports (DFS) pursuant to the Nevada Gaming Control Act and the regulations adopted thereunder. I further asked the Gaming Division of the Office of the Nevada Attorney General to perform a legal analysis as to whether DFS activities conflict in any way with Nevada law. Based on these analyses, I, along with Board staff, have concluded that DFS constitutes gambling under Nevada law. More specifically, DFS meets the definition of a game or gambling game pursuant to Chapter 463 of the Nevada Revised Statutes. Moreover, because DFS involves wagering on the collective performance of individuals participating in sporting events, under current law, regulation and approvals, in order to lawfully expose DFS for play within the State of Nevada, a person must possess a license to operate a sports pool issued by the Nevada Gaming Commission. Further, a licensed operator who offers DFS must comply with all laws and regulations that apply to licensed sports pools.
Therefore, since offering DFS in Nevada is illegal without the appropriate license, all unlicensed activities must cease and desist from the date of this Notice until such time as either the Nevada Revised Statutes are changed or until such entities file for and obtain the requisite licenses to engage in said activity. Although Nevada gaming licensees who have received approval to operate a sports pool may expose DFS for play themselves in Nevada (in compliance with all applicable statutes and regulations), such licensees should exercise discretion in participating in business associations with DFS operators that have not obtained Nevada gaming approvals. While this Industry Notice is intended to provide clear guidance as to Nevada law, Nevada licensees wishing to conduct business with DFS companies should also conduct thorough and objective reviews of DFS activities under the laws of other states and any applicable federal laws.”
This is another huge hit for DraftKings and FanDuel, as this news broke a day after reports surfaced that the Department of Justice and FBI have launched their own investigations into the legality of DFS sites. DraftKings and FanDuel have long claimed that these games are based on “skill,” however with all of the recent stories that call into question who exactly has access to the game’s data, one has to seriously question just how much “skill” is involved with those that have access to that data. The New York Times has been all over this DFS scandal from day one and there’s no doubt that there will be more twists and turns in what will most likely be a long, drawn out process to eventually regulate DFS sites.