Sports fans are wagering thousands of dollars on the performance of professional athletes each day online, and it is all perfectly legal.
Known as daily fantasy sports, the games are part of an exemption to federal law banning online gambling. In daily fantasy sports, winners aren’t determined by the outcome of a single game or the performance of a single player.
Most fantasy competitions — football or baseball — last a season, but more and more players are looking for their daily fantasy fix. Critics argue that turning fantasy sports into a daily competition edges it closer to being a game of chance that’s essentially equivalent to placing a bet at race and sports books in Las Vegas.
“I’m not going to give a legal opinion,” John Kindt, an emeritus professor of business and legal policy at the University of Illinois, said Thursday. “But what I would say is that this was not the intent of Congress when it prohibited online gambling.”
The Unlawful Internet Gambling Enforcement Act of 2006 regulated online gambling by prohibiting gambling businesses from knowingly accepting payments in connection with a wager. The law excluded fantasy sports and legal intrastate and inter-tribal gaming.
Some fear shoddy marketing will eff it up for skill-game players
It’s a question that most attendees of the Fantasy Sports Trade Association Winter Conference in Las Vegas didn’t want to answer: Are some fantasy websites walking a thin line between gambling and fantasy sports when it comes to marketing their websites?
The question pertains to a new and profitable trend of daily betting sites such as Cantor Fantasy, Fan Duel, Fan Ball and Draft Day that process millions of dollars in transactions between players who organize and bet on new lineups.
“We support daily game companies,” Paul Charchian, president of the Minneapolis-based FSTA, told about 200 conference attendees Tuesday at The Mirage. “By far, daily games are the fastest growing part of our business. Don’t (mess) it up.”
Charchian said he was concerned that some daily sites are marketing themselves like offshore sports books did before the federal crackdown in 2006. He urged them to be “much more conscious about creating consumer confusion.”
Cantor Gaming sees profits in "not gambling" industry
The number of Americans playing fantasy sports has grown by 2 million annually for the past two decades, transforming what was once the pastime of a few devoted baseball fans into a lucrative business, generating more than $3 billion annually in total revenues, according to an industry analyst.
“We’re very comfortable these days,” said Paul Charchian, president of the Minneapolis-based Fantasy Sports Trade Association, which will hold its annual convention this month at The Mirage. “We’ve been growing at a ridiculous rate. Some day we won’t be growing by 2 million annually and I’m sure there’ll be stories asking us why we’re not growing by 2 million anymore.”
Fantasy sports were born in the 1960s, but it wasn’t until the late 1980s and early 1990s that it developed into a national sensation.
“We have grown by 2 million people a year since the Internet took off in the mid-1990s,” Charchian said.