Plenty of attention for fantasy sports

Fantasy sports companies have spent tens of millions of dollars in a short period to attract players to their sites. Lately, they’ve been getting the kind of attention money can’t buy and a spotlight the operators would clearly prefer not to have shine on them.

Earlier this month, two of the largest sites, FanDuel and DraftKings, took a credibility hit when it was reported that one of DraftKings employees released proprietary information before it should have been made public, a faux pas that could have altered results. Then it was learned that same employee won $350,000 on the rival FanDuel site, prompting questions about him benefiting from insider information.

This week, top Massachusetts lawmakers floated the idea of taxing and regulating the fantasy sites. And now comes word from the Wall Street Journal that the FBI in Boston is probing whether fantasy sites, which have a congressional exemption to operate legally, are violating federal gaming laws.

And to make matters worse, the New York Times runs a dark, 7,000-word piece – Part 1 of a multiple-piece series reported in collaboration with PBS’ “Frontline” – that calls the congressional law that tried to rein in online gambling while giving the green light to fantasy sports play “a spectacular failure.”

“Congress failed to grasp the power of the inexorably evolving Internet, or how difficult it would be to regulate,” the Times piece says. “By allowing entrepreneurs to exploit a legal, if suspect, exemption, the law unwittingly opened the way for the now-ubiquitous fantasy sports games that increasingly resemble gambling.”

According to the Journal, FBI agents have launched an initial probe by contacting customers of Boston-based DraftKings as part of a preliminary probe to determine if fantasy sports sites have strayed into the field of daily betting, even if they don’t call it that. Even though fantasy sports has a carve-out from the 2006 law that tried to outlaw Internet gambling, the Justice Department is asking whether the companies have gone too far.

The Journal points out how fantasy sports is not just big business – both DraftKings and FanDuel are each valued at more than $1 billion – but they attract big business. Venture capital firms, major professional sports leagues, including Patriots owner Robert Kraft, and media companies are among those who have invested heavily into the emerging field.

But, with the heat turning up and questions being asked not only about their legality but about their credibility, others are beginning to back away. ESPN, which has an agreement to run $250 million in ads from DraftKings, has ended its segments sponsored by the fantasy site. The New York attorney general is investigating fantasy sports operations in the wake of the employee scandal earlier this month and Massachusetts Attorney General Maura Healey is in talks with DraftKings and FanDuel to make sure consumer protections are in place for players, according to the Journal.

But the most foreboding turn of events could be the Times/Frontline investigation that looks at the continuing seamy side of betting and the booming fantasy business, which few ever foresaw when Congress passed the law. The Times has an interesting video piece accompanying the initial story about a college junior who claims to make a six-figure annual income from playing fantasy sports. The story itself has a compelling narrative about how young males, who are considered the most vulnerable to compulsive gambling problems, are the biggest players on the sites.

Some members of Congress are beginning to call for revisiting the fantasy sports exemption and the latest news could be just the trigger to launch a new measure to regulate – perhaps even outlaw – the runaway horse.

JACK SULLIVAN

 

BEACON HILL

Gov. Charlie Baker will unveil legislation today to address the state’s opioid crisis. (Boston Globe) Some hospitals are leery of the legislation. (The Sun)

Leaks in the Big Dig tunnels are costing $5 to $7 million a year to deal with, the Herald reports.

A Boston municipal court judge ruled that former House speaker Tom Finneran, stripped of his state pension following a 2007 federal conviction related to lying under oath in a redistricting lawsuit, is entitled to receive the benefits after all. The judge ruled that Finneran was not acting in his official capacity as Speaker when he testified in the case. (Boston Globe)

Proposed legislation would create a new state board….to examine which state boards can be eliminated. (Boston Globe)

MUNICIPAL MATTERS

The calendar may say 2015 but Easton just promoted its first female police officer to the rank of sergeant. (The Enterprise)

CASINOS

Officials with MGM Resorts say they provided the introductions that began talks between Springfield and the Pawsox to relocate the team to western Massachusetts. (Masslive)

WASHINGTON/NATIONAL/INTERNATIONAL

US Rep. Niki Tsongas addresses gun control and the role of women in combat (she’s in favor of both) in a wide-ranging chat with Jim Braude. (Greater Boston)

US Rep. Seth Moulton tells North Shore business leaders he has hired an economic development director. (Salem News)

Arkansas Gov. Asa Hutchinson, who leads the country’s fattest state, unveils a 10-year program designed to improve public health. (Arkansas Times-Record)

ELECTIONS

A Boston Herald editorial says Hillary Clinton wants to have it both ways on capitalism and income inequality. (Boston Herald)

Fall River City Councilor Jasiel Correia accused Mayor Sam Sutter of unspecified “corruption and unethical behavior” while the first-term mayor hit his 23-year-old opponent for his youth and inexperience in the first debate between the pair. (Herald News)

American Federation of Teachers chief Randi Weingarten is apparently concerned about only certain types of “dark money” flowing into election coffers. (Boston Magazine)

RELIGION

The Roman Catholic Archdiocese of Boston won its latest round against a group of parishioners occupying a shuttered Scituate church when the state Appeals Court ruled Wednesday the protesters were trespassing and must vacate the church and end their 11-year vigil. (Patriot Ledger)

ARTS/CULTURE

Boston Globe architecture critic Robert Campbell has high praise for the (new) New Balance headquarters in Brighton.

A new study shows minority-focused nonprofit museums and performing arts organization struggle to attract grants and donations compared to other cultural institutions. (Los Angeles Times)

BUSINESS/ECONOMY

Wareham officials have suspended commercial oystering for the next three years because of depleted stocks from fishermen taking the shellfish faster than they grow. (Standard-Times)

Verizon tells city officials it has no plans to expand FiOS service in Boston. (Boston Herald)

Boston signs a sister city pact with Praia, the capital of Cape Verde. (Bay State Banner)

Latino women are the worst off when it comes to the wage gap. (Bay State Banner)

Retail sales around the country were anemic in September for the second straight month, prompting analysts to predict it doesn’t bode well for the holidays. (U.S. News & World Report)

Massachusetts will survive the sale of EMC to Dell, says The MetroWest Daily News.

New Tesla car will change lanes by itself. (Time)

EDUCATION

Boston parents and school officials discuss the new school assignment application proposal which would allow parents to apply to both charter and traditional public schools. (Bay State Banner)

Cassandra Cumberlander explains why she sent her children to a charter school in Boston. (CommonWealth) An Eagle-Tribune editorial decries the Legislature’s inability to lift the charter school cap.

A contract squabble in Woburn has teachers there holding back on any activities not contractually mandated — and parents and students aren’t happy. (Boston Herald)

An Item editorial suggests the MCAS vs. PARCC debate isn’t as high stakes as fans of the two standardized tests would lead everyone to believe.

HEALTH/HEALTH CARE

The first major study of adverse effects from the largely unregulated dietary supplement industry finds that more than 23,000 hospital emergency room visits annually are the result of adverse effects from supplements. (Stat)

Paul Levy has fond farewells for Jim Roosevelt, who is stepping down as CEO of Tufts Health Plan after 16 years, and Maureen Bisognano, who is retiring as the head of the Institute for Healthcare Improvement. (Not Running a Hospital) WBUR has a report on Roosevelt’s departure.

TRANSPORTATION

As well-to-do people move into cities, they are displacing poorer people who end up in suburbs where the public transportation services they depend on is inadequate, according to a US Department of Transportation forum in Boston. (WBUR)

ENERGY/ENVIRONMENT

The Pilgrim shutdown causes a dramatic shift in the energy debate on Beacon Hill, as policy-wonk discussions give way to the politics of getting a deal done. (CommonWealth) A Lowell Sun editorial does the math and says the Pilgrim shutdown means the region needs more natural gas. Entergy, the plant’s owner, wants to reduce the evacuation zone around the plant. (Cape Cod Times)

Curtis Cole, the director of business development for Tennessee Gas Pipeline Co., says new pipelines, not more LNG tankers, are the answer to the region’s energy problems. (CommonWealth) The Federal Energy Regulatory Commission so far has ignored Peabody Mayor Ted Bettencourt’s plea for a local hearing on a Tennessee Gas’s pipeline proposal. (Salem News)

Four days of deer hunting in the Blue Hills have been approved by the state. (Boston Globe)

New polling data indicates American skepticism of climate change has hit an all-time low. (Time)

Pittsfield bans polystyrene foam containers. (Berkshire Eagle)

CRIMINAL JUSTICE

A judge is expected to order a mental health evaluation today of Phillip Chism, the Danvers teenager who currently on trial charged with killing his Danvers High School math teacher. (Boston Herald)

MEDIA

Tuesday’s Democratic Debate had a record 15.3 million viewers, the most ever for a Democratic primary forum. (CNN)

Columnist Dianne Williamson offers up a hilarious personal tale prompted by Playboy’s decision to do away with nude pictures of women. (Telegram & Gazette)