According to The New York Times employees of DraftKings and FanDuel – those insanely popular daily fantasy sites whose ads are borderline impossible to escape if you watch TV, have a computer, or go outside – have been accused of using information unavailable to the public to rake in huge winnings from each others’ sites.
A DraftKings employee admitted to inadvertently releasing data betraying the players most frequently used in fantasy lineups on the site ahead of Week 3. It’s data that’s made available to everyone after lineups are locked in, but can give anyone a huge advantage if gained ahead of time. Ethan Haskell won $350,000 on FanDuel that same week.
Forbes reports that employees of DraftKings are allowed to bet on rival sites, but betting on this data before lineups are set is basically insider trading.
On Monday, both companies released a joint statement ensuring the integrity of their respective employees:
“Both companies have strong policies in place to ensure that employees do not misuse any information at their disposal and strictly limit access to company data to only those employees who require it to do their jobs. Employees with access to this data are rigorously monitored by internal fraud control teams, and we have no evidence that anyone has misused it.”
Chalking this employee’s alleged mistake and his winnings of over a quarter of a million dollars in the same week up to coincidence, this doesn’t look good for either company, and will likely bring further and more intense scrutiny to both.
As for everyone else? The only thing they seem surprised about is that it’s taken this long for something like this to happen, considering the complete lack of regulation in the industry.
