Healey proposes fantasy sports regs
‘Professional’ players would be identified
STATE HOUSE NEWS SERVICE
SAYING THAT HER ONGOING REVIEW of daily fantasy sports games uncovered “a number of significant concerns,” Attorney General Maura Healey on Thursday announced a series of proposed regulations for the burgeoning industry, including a ban on players under the age of 21.
The relatively new form of online sports wagering, under Healey’s proposed regulations, would also be banned from offering fantasy games based on college sports, advertising for fantasy games at high school and college campuses, and accepting total deposits of more than $1,000 a month from most players.
At a press conference in Boston, Healey described the regulations as the first of their kind and said they are intended to protect consumers who are selecting athletes and placing wagers with the hopes of winning jackpots by outscoring other fantasy sports participants.
Healey is also seeking to forbid professional athletes and agents from entering daily fantasy sports contests in their own sport, and banning company employees — who may have access to insider information — from playing at all.
Additional regulations include requirements that advertisements include information on available assistance for problem gamblers and disclose the average net winnings of all players when mentioning the average winnings among players who win at all.
“I think they’re very common sense protections that all would agree make a lot of sense in this new industry, so I’m expecting them to begin compliance today as the rule making process goes forward,” she said. “They certainly have professed that protecting consumers is important to them and, as I said, I expect them to begin to take steps to immediately comply with these regulations.”
In a statement, FanDuel backed Healey’s approach to regulation and said the company intends to submit its own comments on the proposals during the public comment period, which ends Jan. 22.
“Attorney General Healey’s approach towards regulating fantasy sports makes a tremendous amount of sense – it provides strong protections for consumers and allows sports fans to continue doing something they love,” the company said in the statement. “FanDuel believes that regulations which increase transparency and ensure contests are fair will benefit the entire fantasy industry.”
In its own statement, DraftKings said Healey “has taken a thoughtful and comprehensive approach” to regulation and will take immediate steps to prepare to implement the required changes.
“While we do have some concerns with the draft regulations, we intend to work closely with the Attorney General’s office to ensure we are operating in the best interest of our customers,” the company said in a statement. “We will utilize the next 60 days to share our comments in the hopes of effecting some changes and are firmly committed to continuing to operate in a lawful and transparent manner.”
A Schneiderman aide declined to comment on Healey’s plan.
Healey has said that playing daily fantasy sports is gambling, but that it is not explicitly forbidden under state law. On Thursday, she called the contests “games that you carry around with you in your pocket and lose money at the touch of a button.”
The attorney general said she has not played any of the games herself — as Gov. Charlie Baker has — saying, “I spend a lot of time rooting for real teams and real players and I don’t have a whole lot of time to do much else.”
Citing the fact that her office’s review of the industry found that about 90 percent of all prizes are won by less than 2 percent of all players, Healey said she wants to ensure more truthful advertising and increased transparency about the prevalence of “professional” bettors.
“The fact of the matter is there are a subset, a very small subset, of professional players who use sophisticated software and algorithms, and through their experience, through their expertise, are in fact able to win the vast majority of the contests,” she said. “What I think is important is that the public and those who wish to play on these sites understand that that is in fact the state of play.”
The regulations would attempt to make clear which players are “professional” players by requiring daily fantasy sports companies to identify which players have won a certain amount of contests within a certain amount of time and attaching a symbol to that player’s username so other players will know who they are competing against, Healey said. They must also offer games exclusively for beginners — defined in the regulations as anyone who has entered fewer than 51 contests.
“We want to be sure that companies are straight with the playing public about who it is they’re playing against and what it is they’re up against,” she said.
The proposed ban on advertisements targeting high school and college students, Healey said, is due in part to a concern that students already facing mountains of student loan debt could become further indebted by playing online fantasy sports.
“We’re in a time right now where students across this country are mired in debt and I have real concerns about anything that would exacerbate students taking on more debt in the form of credit extended to play daily fantasy sport games,” the attorney general said. “It just does not make sense to me at all.”The regulations, which Healey said she will file with the Secretary of State’s office on Friday, will be the subject of a Jan. 12 public hearing. A public comment period will be open until Jan. 22.
The attorney general said her office’s review is not complete and the regulations she put forward Thursday do not preclude the Legislature, Gaming Commission, Treasury, or others to take additional action in the fantasy sports realm. At its meeting Thursday morning, the Gaming Commission announced that it will hold a day-long public hearing on fantasy sports on Dec. 10