New York Attorney General Eric Schneiderman wants to know if employees of the two largest fantasy football betting sites used privileged information to make money on NFL games.
Earlier this week, The New York Times revealed an insider trading scandal involving fantasy football betting websites FanDuel and DraftKings. The scandal broke after an article in the Times revealed that an employee of DraftKings released player data and then personally made $350,000 using the info on rival site FanDuel.Employees of the sites used early data to make their own bets win big money.
Now the scandal has brought the attention of politicians looking to regulate the industry. The New York attorney general leads the charge.
Schneiderman sent a letter to FanDuel CEO Nigel Eccles and DraftKings CEO Jason Robins informing them that he was launching an inquiry into the case of possible “insider trading” of data.
As ESPN reports, in the letter Schneiderman asks them to provide information covering the past year including names and titles of employees who compile player data, set roster values, deal with ownership percentages for pending and historical contests and aggregate the success of players who play on their sites.
The letter lays out the request for information on employees:
- Compile and aggregate athletes’ statistical data;
- Determine inputs used to set athletes’ prices for daily fantasy contests;
- Code athlete pricing algorithms (note if and where different from 1b.);
- Compile and aggregate athletes’ ownership percentages for pending contests;
- Compile and aggregate historical ownership percentages for past contests; and
- Compile and aggregate daily fantasy players’ data, including but not limited to win/loss records, types of contests entered, number of entries per contest, and money spent and earned
The letter also requests information on how the data is stored, how employees access that data, what employees are allowed to do so, and what guidelines or rules the two companies have over data storage and access.
Also requested is information on any company policies meant to prevent this sort of “insider trading” and guidelines governing employee behavior. The letter also asks if such rules extend to family and friends of employees.
Finally, the letter asks for specific information about the two employees most known for being involved in this incident: Ethan Haskell of DraftKings, who won $350,000 on FanDuel, and FanDuel employee Matthew Boccio, who won big money at DraftKings.
The attorney general also demands this information from the websites by October 15.
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