A scandal is rocking the world of fantasy sports websites like DraftKings and FanDuel, where you compete with a fantasy team using real players’ statistics. You get points and win money if they do well in real life.
There are accusations that an employee of one of the sites used insider information to win big.
The question now is, should the government regulate these sites? People like Rep. Frank Pallone say yes. Pallone, a Democrat of New Jersey, calls these fantasy sports sites the Wild West. Completely unregulated.
“So that if people place a bet they don’t even know if they’re being treated fairly,” he said.
Gambling is regulated by the states. Pallone said you could keep it that way, “or if you thought that you wanted to have these sites continue nationally, I guess you’d have to have something like an SEC type of situation.”
Pallone and Sen. Bob Menendez, D-NJ, sent a letter Tuesday to Federal Trade Commission Chairwoman Edith Ramirez, calling on her to “implement safeguards to ensure a fair playing field for fantasy sports enthusiasts who participate in daily or weekly games.”
The sites are temporarily prohibiting their employees from playing for money. Rick Burton, who teaches sport management at Syracuse University, maintains those employees should never have been allowed to play.
“I assume that’s probably like racetracks probably don’t allow their employees to bet on the horses,” he said.
If fantasy sites don’t end up being regulated, players might just stay away. The market might do the regulator’s job.
“If I’m playing daily fantasy sports and I find out I’m playing against, potentially, some insider who has insider information, I don’t think I’m going to join,” said Dr. Timothy Fong, co-director of the UCLA Gambling Studies Program.
Fong said people could go back to just playing informal fantasy games with friends. That’s what he’s doing — assembling a fantasy baseball team, without any players from his favorite team, the Cubs.
“Because of their hundred-year tradition of losing and not doing well,” he said.
He may regret that. After all, the Cubs are in the playoffs this year.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.