Lawmakers urged to weigh in on fantasy sports

Despite AG’s view, Gaming Commission says legality unresolved

STATE HOUSE NEWS SERVICE

THERE IS “SOME URGENCY” for the Legislature to weigh in on the legality and regulation of daily fantasy sports and online gaming, the Massachusetts Gaming Commission concluded in a white paper on the relatively-new form of sports wagering.

“Right now, it appears to us that the law concerning (daily fantasy sports) DFS is at best unsettled, and that there is a possibility that DFS could be considered illegal, even though the Attorney General has seen fit to move directly to the issues that really matter — consumer protection regulations that will permit the pleasure of DFS play, while protecting against its possible downsides,” Gaming Commission Chairman Stephen Crosby wrote in an introduction of the paper.

Crosby continued, “Until this legal uncertainty is resolved — which can only be done by the Legislature — the citizens of Massachusetts, DFS players, and DFS companies alike (including one of the leaders, DraftKings, which is located in Boston), will find their activities risky, and the DFS future utterly uncertain.”

Since daily fantasy sports erupted into the public consciousness at the beginning of the NFL football season, legislative leaders have agreed that the industry ought to be regulated, but no specific legislative proposals have yet been brought forward.

Attorney General Maura Healey has proposed consumer protection regulations for the fantasy sports world, including a prohibition on players under the age of 21 and a ban on fantasy games based on college or amateur athletics. Healey’s proposed regulations will be the subject of a public hearing Tuesday morning.

The Gaming Commission’s report, which comes after more than a month of research and a day-long public forum on the topic, suggests that the real question for the Legislature is not whether DFS is legal, but rather, “Do we want DFS to be legal, and if so, under what conditions?”

Among possible options presented by the Gaming Commission for the Legislature’s consideration is the establishment of a single Internet gaming regulatory body to address questions of regulation for DFS and any other form of Internet-based gaming that may be developed.

“The regulatory body’s jurisdiction would be broad enough to invest it with the power to look at all Internet gaming activity, determine whether any form of regulation of that activity is necessary and, if it is, create ‘right-sized’ regulations to deal with it,” the commission’s paper said.

The paper said a new regulatory body would be able to “keep itself abreast of developments in the Internet gaming industry and develop a body of expertise allowing it to decide quickly the kinds of dangers the new activity posed or presented.”

Though no legislative approaches have yet been proposed, Senate President Stanley Rosenberg on Monday said Sen. Eileen Donoghue, of Lowell, and others have been studying the issue and how other states are grappling with the DFS world.

“They’ll be coming out with some ideas and opinions further down the road,” Rosenberg said. “So there’s homework being done, more to be said.”

To read the Gaming Commission’s full report, click here.