Report: Two Major Fantasy Football Companies Tangled In Scandal
PHILADELPHIA (CBS) -- The New York Times reports on a developing fantasy football scandal. Two major fantasy sports companies are involved.
A worker allegedly used insider knowledge to win hundreds of thousands of dollars.
On game days, and seemingly every day this fall, the ads are everywhere. Now, so is the money.
But their business model is under the microscope after allegations of what essentially amounts to "insider trading."
According to a report in the New York Times, a Draft Kings employee admitted he released early data on what specific players were most used in starting lineups ahead of the NFL's third week.
Getting that early information ahead of the curve could serve as an advantage. The employee went on to win $350,000 later that week betting on rival fantasy football website, FanDuel.
In a joint statement, the industry leaders DraftKings and FanDuel defended their practices, in part saying: "employees with access to this data are rigorously monitored by internal fraud control teams, and we have no evidence that anyone has misused it."
The sites use a relatively new format, paying out massive cash prizes on a daily or weekly basis instead of season long traditional fantasy leagues.
The federal government doesn't define it as gambling, instead calling it a game of skill not chance.
"This business is very unregulated. I mean seriously we've come a long way from the dorm room playing amongst your friends to now the corporate sphere that is fantasy football," said Brandon Robinson with CBS Sports Radio.
But for the nearly 60 million people who take part in this "game of skill", the question now is whether they're also being suckered.
DraftKings and FanDuel both ban employees from taking part in gaming on their own sites, and have now temporarily barred employees from taking part in any other rival sites as well.
