Massachusetts: The latest state to take a closer look at daily fantasy sports
Gaming Commission to initiate review of DFS product offerings that mimic sports betting
The slow and steady rise of daily fantasy sports (DFS) offerings that closely resemble traditional sports betting products has begun to catch the attention of gaming regulators across the US, with Massachusetts the latest state set to take a closer look at DFS operations.
In a Massachusetts Gaming Commission (MGC) public meeting on August 8, interim executive director Todd Grossman referenced the increased scrutiny other state regulators have applied to DFS recently and indicated the MGC would be following suit.
“There’s been a great deal of activity surrounding the boundaries of sports wagering and daily fantasy sports, and whether there’s some overlap between the two,” Grossman said in the MGC meeting. “That is to say, whether there are certain activities offered by DFS operators that may be considered sports wagering activity.”
At issue are the various forms of ‘vs the house’ products – which are primarily centered around player-prop parlays at predetermined odds depending on the number of legs in the wager – offered by leading DFS operators like PrizePicks and Underdog Sports that have become some of the most popular forms of DFS among users.
Those types of products differ significantly from the more traditional peer-to-peer DFS games in which users compete against one another, as opposed to the house, for shares of a prize pool.
“That’s been addressed in a number of jurisdictions now and has been discussed publicly,” Grossman said. “I wanted to note we are certainly aware of this issue and we’re in the process of reviewing it.”
Grossman was referring to multiple jurisdictions, headlined by New York – the largest regulated sports betting market in the country – which just last week in a Register update rejected a commenter’s request to alter proposed DFS rules in order to allow for player-prop-style games.
The New York development came on the heels of Wyoming regulators sending a cease-and-desist letter to both PrizePicks and Underdog in July regarding the false advertisement of sports wagering as DFS, while regulators in Maine sent a similar notice of complaint to Underdog around the same time.
Both DFS operators contend their prop-centric parlay markets are games of skill and thus fall under the carve-out of the 2006 Unlawful Internet Gambling Enforcement Act that ultimately paved the way for DFS.