Sports

Idaho attorney general bans paid daily fantasy sports contests

A reporter breaks down daily fantasy football

Statesman reporter Zach Kyle wagers $10 on a FanDuel football contest and explains how daily fantasy works.
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Statesman reporter Zach Kyle wagers $10 on a FanDuel football contest and explains how daily fantasy works.

Andrew Smith is one of many Idahoans who received an email Monday morning saying he can no longer participate in paid daily fantasy sports contests.

Industry powers DraftKings and FanDuel have agreed to quit providing those contests to consumers in Idaho, Attorney General Lawrence Wasden said in a statement released Monday morning. The agreement was reached after three months of negotiations, Wasden said.

“The concern I have is that the paid daily sports offerings provided by these companies constitute gambling under Idaho law,” Wasden said in the statement. “I have a duty to enforce and uphold that law. I commend the companies for negotiating in good faith and agreeing not to make these contests available in Idaho.”

Under terms of the agreement, the companies, as of May 1, will not allow any consumers based in Idaho to participate in any of their daily paid online fantasy football, baseball, basketball and other sports contests.

That doesn’t sit well with Smith, a 42-year-old sales manager in Meridian. He signed up with FanDuel in 2013. Smith said he played traditional fantasy sports with friends and wanted to give the national service a try.

“I do not play the big tournaments generally, usually their 50/50 leagues and not for more than $5 or $10 at a time. It’s recreational but (I) clearly enjoy it. It does make a mundane matchup on TV more interesting,’’ Smith told the Statesman. “I work with older ladies that spend $100 a week playing the Idaho Lottery and get nothing in return. I deposit a $100 in FanDuel and can play for months and I have cashed out on occasion.

“Definitely disappointed that Idaho has taken this matter up to limit my individual liberties in deciding what to do with my money. I do not have a gambling problem, pay my taxes, homeowner, employed with no criminal record. And I don’t even want to get into whether it’s ‘skill or luck’ because it doesn't matter, it’s my money.’’

DraftKings and FanDuel have agreed to process requests by Idaho participants to withdraw their account balances in a timely manner. The companies will monitor Idaho players based on geoblocking technology or through IP addresses.

In December, the Idaho Statesman reported that Idaho had not tackled the issue, though one lawmaker expected it to happen.

Wasden began a review of the companies and their websites in January amid concerns regarding the legality of the daily fantasy sports contests offered by those companies. The Idaho Constitution prohibits gambling except for the state lottery, pari-mutuel betting, and bingo and raffle games.

“Idaho defines gambling, in part, as risking money or other thing of value for gain that is contingent in whole or part upon chance or the outcome of an event, including a sporting event,” Wasden said. “My concern is that the daily fantasy sports offerings my office reviewed require participants to risk money for a cash prize contingent upon individual athletes’ collective performances in various future sporting events. As I see it, this falls within Idaho’s definition of gambling.”

Nothing in the agreement precludes FanDuel or DraftKings from offering free daily fantasy sports leagues or other free contests that offer prizes to players in Idaho.

The agreement signed by both companies provides a path to resume offering paid fantasy sports contests to Idaho consumers, including the Idaho Legislature changing the law to allow for and regulate such contests. Paid daily fantasy sports contests could also resume if a court with authority and jurisdiction in Idaho rules in favor of any form of such contests.

The companies can also restart offering such contests at any time, but executives have agreed to provide the attorney general written notice 30 days prior to doing so. The notice serves to give the attorney general time to evaluate the proposed contests to determine whether they comply with Idaho law.

The agreement does not constitute an admission of liability nor evidence of wrongdoing by the companies, Wasden said.

FanDuel’s letter to Idaho consumers

We have some important news to share regarding FanDuel contests for players in Idaho.

We believe FanDuel has always operated within the law in Idaho, however, as we continue to evaluate the legal framework, we have decided to suspend our paid operations in the state. As has always been the case, users in Idaho can withdraw their funds at any time.

We are continually working to clarify the law and look forward to working with legislators to enact consumer protections so that we can bring our paid contests back to Idaho sports fans once again. In the meantime, please show your support by going to www.fantasysportsforall.com/connect/idaho and let your elected officials know how much you enjoy playing fantasy sports.

Thank you for your support,

FanDuel

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